NADIA MITSOPOULOS, HOST: Let's get a response from the Minister for Aged Care and Seniors, Sam Rae. He's actually been listening to Helen Morton. Minister, good morning and thank you for talking to me.
SAM RAE, MINISTER FOR AGED CARE AND SENIORS: Good morning, Nadia. Thank you for having me on.
MITSOPOULOS: I'll get you to respond to some of those concerns in a moment, but how will these changes raise the standard of aged care?
RAE: Nadia, we are well on our way through a once-in-a-generation transformation of Australia's aged care system. We want every single older person across our country to be able to access safe, dignified, and high quality aged care. And I think, in understanding where we're at now, we have to look back to the Royal Commission and the years that preceded it. And of course, what that Royal Commission uncovered and brought to light were appalling examples of mistreatment of older people in care.
And it's fair to say that we have a rapidly ageing population. We have a community with evolving expectations of the quality and the level of services that be provided to older people. So, the time is right to be taking the next step. This is not the beginning and it's not the end of the transformation process, but this is a very significant step on the 1st of November, the introduction of the new Aged Care Act- or rather the implementation of the new Aged Care Act. It is a rights-based act. It affords older people for the first time in the history of our country a set of rights under which their care must be delivered.
MITSOPOULOS: Okay. As well as those set of rights, which is absolutely- commend you for doing that, the big concern seems to be the co-contributions, particularly for those who will want to age at home. So, my understanding is, you'll continue to fund clinical services, right?
RAE: The Federal Government funds 100 per cent of clinical services. So I think that to which you're referring, and perhaps Helen was referring to is the co-contribution model that comes under our new Support at Home program. So we have a program at the moment called the Home Care Packages Program, and it's been growing very, very fast. We know older people want to stay their homes for longer. It's healthy for them, it's good for their communities and their families, and it's obviously good from a Government expenditure perspective in terms of making sure that we have a sustainable aged care system. So we want to support people to do that.
But it has been growing very fast. In fact, it's more than doubled in the last five years. And in the last decade, expenditure in the home care space from the Government has risen by about 800 per cent in 10 years. So, we need to make sure that we have an aged care sector that is not only delivering that high quality, dignified care for people, but is also sustainable and it is equitable in terms of everybody being able to access those services. But part of the-
MITSOPOULOS: And so just on that, but should things like showering, incontinence care, should they have been included in clinical services so people wouldn't have had to pay for that?
RAE: Clinical services, by definition, have to be delivered by a clinician and, in most of these cases, by a nurse. But that said, we have some very strict systems in place in order to watch what's happening, to understand- as Support at Home rolls out, to understand what its impact on people across the community will be to make sure that we get positive clinical outcomes for everybody across the community.
MITSOPOULOS: What about- okay, so even full pensioners will have to pay more, right? Five per cent for the things like showering, dressing, transport, and then 17.5 per cent for the everyday things like gardening, cleaning and meal delivery. That's right?
RAE: Well, depending on their situation. Again, the reason that we've brought in the co-contribution model-
MITSOPOULOS: No, no. But I'm saying full pensioners will still have to contribute. I've got the list here. And I know that for part pensioners, it depends on their income and their assets, and then self-funded retirees will have to fund about 50 per cent or 80 per cent of the cost. So everyone will have to pay something?
RAE: It depends, Nadia. It depends on when they join the system. So everybody who was in the system before September 2024 has their arrangements grandfathered under a no worse off principle people who are newer to the system...
MITSOPOULOS: And that's for life?
RAE: Yes, it is. People who are newer to the system, if they are able to make a contribution to their care - and that's a very important point - if they are able to make a contribution to their care, they go through a means test process, and if they've got sufficient funds to make a contribution to their care, they are asked do so. That's so that we have a sustainable system. And you're right, for full pensioner, and in fact for absolutely everybody, the Government will continue to pay 100 per cent of the clinical care costs no matter what.
MITSOPOULOS: It’s just the extra things.
RAE: Correct.
MITSOPOULOS: So, are there any concessions for pensioners who are renting?
RAE: Well, again, there's a means test process in place to understand what the means are for those people to make a co-contribution, and there are very robust hardship provisions in place. So, if people, either at the beginning of their care or throughout the term of their care, are unable to make a co-contribution, then our hardship provisions come into place to make sure that they have a continuity of care, even though they might be facing financial challenges.
MITSOPOULOS: Okay. Sam Rae is my guest this morning, the Federal Minister for Aged Care and Seniors. If someone has been assessed and been told they will be able to get a package but not yet offered a package, will they be grandfathered or do they go on to the new system?
RAE: If they were assessed and approved for a home care package before September 2024, they are treated under the grandfathering system as if they were already receiving that care. So we make sure that anyone who's made the effort and sought to join the system, even if the system hasn't yet been able to respond to their needs, that those people are treated as if they were already receiving their package. It's the fairest way to deal with this.
MITSOPOULOS: Okay. And so even if- so assessed, but even they don't have that package yet, they're okay, providing it was before September 2024. Then what happens if someone moves up a level? As they move up into levels of care, because there's now eight levels, they will still be grandfathered?
RAE: Again, if they're in the national priority system before that September 2024 period, they will be grandfathered under the system as they go through. So, again, this is about making sure that this system is as fair as possible for every single Australian.
We don't want to end up in a situation where aged care, the quality of your aged care services, depends entirely on how much money you've got in your bank account. The Federal Government will continue to be the primary provider of aged care in terms of the funding. It's only where people have the means to make a co-contribution that they're being asked to do so.
MITSOPOULOS: And they'll also be asked to make co-contributions in residential facilities as well?
RAE: Well, there are already a range of systems in place in residential aged care. And depending, again, on people's financial means, they make a contribution to their care. There are some people who don't, who aren't able to make a contribution to their own residential aged care, in which case the Government already pays that proportion. And different providers in the residential aged care space structure their financial arrangements with residents differently. But the Government always acts as the primary funder of clinical care in that space as well.
MITSOPOULOS: If I can just quickly look at some of the changes in the residential facilities. So now those providers will be able to take two per cent a year for five years from someone's refundable accommodation deposit or RAD. Why did you make that change? Is that just so that they can have a bit more funding?
RAE: What we've seen over the last probably decade and a half, Nadia, is that we have not realised the amount of investment in the residential aged care system that we need. And part of the reason for that is about the sustainability and the investability of the sector. So we want older facilities to have the money to refurbish and keep them up to date and make sure that they are, you know, as comfortable as possible for older people. And, of course, with this ageing population and the challenges that brings, we also want our providers to be able to invest in new facilities.
So, the refundable accommodation deposits – remembering not every resident pays a refundable accommodation deposit - but for those that can afford to pay a refundable accommodation deposit, there is now provision for the providers to keep two per cent a year for a maximum of five years only – and they can never go above that - in order to fund those capital upgrades to ensure that the residents are getting the best possible outcomes in terms of the quality of the buildings and the services that they're receiving, and as well to set up our community for that ageing population challenge that we all know is coming.
MITSOPOULOS: But what we saw a couple of weeks ago with a provider in the southwest had to tell people that they were no longer providing cottage respite because of these changes, because it was going to cost them more. So the concern is that they might start pulling back on services that they're offering if people aren't willing to pay for them.
RAE: Well, that's certainly not the message that I've been getting from the sector, and it's certainly not what the data shows. We are seeing rapidly increasing sustainability. We're seeing profits for aged care providers climbing for the first time in decades. We are seeing a much more sustainable sector and, indeed, we are now starting to see investment in the sector.
I mean part of the problem here, I just want to- I don't want to be too partisan Nadia, but part of the problem here is that when Labor was last in Government under Julia Gillard, the minister at that stage for aged care was a guy named Mark Butler, who is now the Federal Health Minister. And he set in place a decades-long strategy for dealing with the population wave of baby boomers that would come into the aged care space. Unfortunately, we then had the Liberal Government elected under multiple prime ministers, starting with Tony Abbott through to Malcolm Turnbull and on to Scott Morrison, who repeatedly made cuts to the budgets for both aged care and health more generally. And so we're playing catch-up now.
It's why this transformation process is so important, and it's why we're expediting it, to make sure that we can try and fill that gap, that wasted decade under the Libs where they were cutting like crazy. We need to now play catch-up so that our older people don't suffer as a result of that.
MITSOPOULOS: I'm just getting a few people asking if they can just clarify - pensioners who own their own home, can they access the hardship provisions? They seem to think you can't. That you'd have to be renting to be able to access hardship provisions and then, ideally, not pay at all.
RAE: No, there are no changes to the way that the primary residence is dealt with in terms of the means assessment. And the hardship provisions are there really for anybody to access if they are facing financial challenges.
MITSOPOULOS: Whether they're renting? Whether they rent or own their own home?
RAE: Correct. So regardless of their particular primary residence arrangements, they can go through, they can access the hardship provisions. There’s a process, it's a expedited process. It's one people are supported through because often they're facing challenges when they're dealing with financial issues. So people are supported to go through that, and while they're going through it, their care is not interrupted.
MITSOPOULOS: All right, I'll leave it there. Sam Rae, I appreciate your time this morning. Thank you.
RAE: Thank you. Nadia.
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