Aged Care Financing Authority – Past Advice
This page contains details of work previously undertaken by ACFA.
Report to inform the 2016-17 review of amendments to the Aged Care Act 1997
As part of significant changes to aged care announced in 2012, a requirement for an independent review of the reforms was included in the Aged Care (Living Longer Living Better) Act 2013. The Review is being led by Mr David Tune AO, PSM.
In November 2015, the former Minister for Health and Aged Care asked ACFA to provide advice on funding, financing and pricing issues affecting the matters specified in the Review’s terms of reference. In particular, ACFA was asked to focus on such issues as they relate to means testing, fees, accommodation prices, access and workforce.
The report was delivered to government on 11 May 2017.
Report on the Bond Guarantee Scheme and potential alternative arrangements
ACFA undertook a study examining the Bond Guarantee Scheme and alternative arrangements. The study concluded that in addition to the existing Scheme, there were two alternative arrangements that could effectively support a guarantee of the return of a resident’s lump sum accommodation payment:
- retaining the existing Scheme, but then automatically triggering a retrospective levy on all providers to repay the Scheme’s costs
- creating a guarantee fund pool through a levy on all providers (pooled funds would grow and be used to pay the Scheme’s costs).
ACFA identified insurance based alternative options as well as an industry arranged bank guarantee option, but assessed them as unlikely to be as effective. ACFA then developed and distributed a discussion paper before consulting with peak bodies as well as the sector more widely.
In principle ACFA agreed that the Scheme’s beneficiaries should contribute to the costs of the guarantee, where the benefits of doing so outweighed the costs (this should be the case whether the existing Scheme is retained, or another model is implemented).
The report was delivered to government on 1 May 2017 and will inform the Aged Care Legislated Review (2016-17).
Report on the Base Interest Rate Project
ACFA was asked by the government to undertake a short study that would examine the application of the Base Interest Rate (BIR) to the refund of lump sum accommodation payments including:
- an assessment of options; and
- implications of any changes.
The report was delivered to Government on 30 June 2017.
Report on access to care for supported residents
The Aged Care Financing Authority (ACFA) was asked by government to provide advice on cost neutral mechanisms to ensure access to care for supported residents. This included reviewing the efficiency, effectiveness and appropriate level of the:
- supported resident ratio for each aged care planning region
- 25 per cent discount applied to the maximum accommodation supplement amount where a service does not provide more than 40 per cent of its eligible care recipient days to supported residents.
ACFA’s work on this project involved public consultations, with an initial discussion paper being released in May 2015 seeking general submissions. This was followed by a second discussion paper in September 2016 seeking comments on ACFA’s proposed recommendations on supported residents.
ACFA delivered its report on access to care for supported residents to government on 11 January 2017.
ACFA’s recommendations in their report to government were to:
- remove the regional supported resident ratio
- amend the administrative application of the 40 per cent supported resident ratio so that it would apply over the course of a month rather than on a daily basis.
Access to care for supported residents consultation paper
ACFA has released a consultation paper on proposals regarding access to care for supported residents. Feedback is sought from stakeholders on the proposals contained in the consultation paper. Submissions are due by 5.00pm Friday 14 October 2016.
ACFA previously released a discussion paper in 2015 on access to care for supported residents and feedback to that paper has been included in the current consultation paper. ACFA is required to provide advice by 31 December 2016 to the Government on cost neutral mechanisms to ensure access to care for supported residents. This work entails analysing the efficiency, effectiveness and appropriate level of:
- the supported resident ratio for each aged care planning region
- the 25 per cent discount applied to the maximum accommodation supplement amount where a service does not provide more than 40 per cent of its eligible care recipient days to supported residents.
Issues Affecting the Financial Performance of Rural and Remote Providers, both Residential and Home Care Providers
At the end of May 2015, the Assistant Minister for Social Services, Senator the Hon Mitch Fifield, asked the Authority to undertake a detailed and focused study into the factors influencing the financial performance of rural and remote aged care providers. The study was requested to include residential, home care package, Multi-Purpose Services (MPS) and National Aboriginal and Torres Strait Islander flexible fund programme (NATSIFACP) providers operating in rural and remote locations across Australia, with a report to be delivered to the Government.
ACFA delivered its report on Issues Affecting the Financial Performance of Rural and Remote Providers, both Residential and Home Care Providers to Government on Tuesday 19 January 2016.
Factors influencing the financial performance of residential aged care providers
In February 2014 the former Assistant Minister for Social Services, Senator the Hon Mitch Fifield, tasked ACFA with a project to undertake a study into the ‘Factors that Influence the Financial Performance of Aged Care Providers’. In undertaking the study he asked that it would first consider residential care providers and later home care providers.
ACFA delivered its first report on factors influencing the financial performance of residential aged care providers to Government on Tuesday 5 May 2015.
Quarterly reports on the impact of financial reforms on the aged care sector
- On 1 September 2016, ACFA submitted its Fourth quarterly report on the impact of the 1 July 2014 financial reforms on the aged care sector
- On 29 February 2016, ACFA submitted its Third quarterly report on the impact of the 1 July 2014 financial reforms on the aged care sector
- On 21 December 2015, ACFA submitted its Second quarterly report on the impact of the 1 July 2014 financial reforms on the aged care sector
- On 18 September 2015, ACFA submitted its First quarterly report on the impact of the 1 July 2014 financial reforms on the aged care sector
Reports on the impact of the 1 July 2014 financial reforms on the aged care sector
Letter from ACFA Chairman regarding proposed changes to improving collection of financial data
Lynda O’Grady, ACFA Chairman, wrote a letter to aged care providers outlining the purpose and objectives of ACFA in recommending the proposed changes to improving the collection of financial data from aged care providers. The department released a discussion paper for comment by the end of February 2015.
Report on improving the collection of financial data from aged care providers
ACFA presented its report on Improving the Collection of Financial Data from Aged Care Providers to Government in September 2014.
- ACFA’s report on Improving the Collection of Financial Data from Aged Care Providers
- Minister Fifield’s response to Ms Lynda O’Grady
- RSM Bird Cameron’s report to ACFA
2015-16 ACFA Operations Report
This is the fourth annual report on the operations of the ACFA. The report covers the period 1 July 2015 to 30 June 2016.
Demographic facts of ageing in Australia
ACFA released an information paper - The Demographic Facts of Ageing in Australia.
Supported resident data book
On 30 April 2014 ACFA presented the then Minister Fifield with a Data Book on Supported and Non-Supported Residents in Commonwealth funded aged care.
Report funding and financing of the aged care sector
ACFA presented its inaugural Report on the Funding and Financing of the Aged Care Sector to the former Government in June 2013.
- ACFA report to the former Government on the impact of the aged care financing arrangements on sector viability, access to quality care, the aged care workforce and sustainability.
- Report on the residential aged care sector.
ACFA work program
On 4 November 2015, Minister Ley presented ACFA with its new work program.
ACFA Update #2
ACFA Update Issue #2 provides information to aged care providers on the committee's current activities and publications.
ACFA work program
On 22 January 2014, the then Minister Fifield presented ACFA with its new work program and operating framework.
ACFA Update Issue #1 is the first regular update that will be provided to keep aged care providers informed on current activities and publications of ACFA.
Operations Report of the Aged Care Financing Authority Reports
- 2014-15 Operations Report of the Aged Care Financing Authority
- 2013-14 Operations Report of the Aged Care Financing Authority
- 2012-13 Operations Report of the Aged Care Financing Authority
Interim Advice to the Government on Improving the Collection of Financial Data from Aged Care Providers
ACFA interim advice to the former Government on improving the collection of financial data from aged care providers was supplied on 31 July 2013.
The Government Asks ACFA to Monitor Impact of Reforms
As reflected in the Australian Government's response to the Senate Inquiry report, the former Government wrote to the ACFA Chairman requesting ACFA monitor the impact of the aged care reforms.
- For information, see letter from the former Government to Ms Lynda O'Grady, Chairman, ACFA
Methodology for Ensuring Equivalence Between a Daily Accommodation Payment (DAP) and Refundable Accommodation Deposit (RAD)
ACFA provided additional advice to the former Government on RAD and DAP in May 2013.
For information, see:
- ACFA additional advice to the former Government on the methodology for ensuring equivalence between a daily accommodation payment (DAP) and refundable accommodation deposit (RAD); and
- The former Government’s response to this advice.
Modelling of Financial Impacts of the Aged Care Reforms
In May 2013 ACFA provided the former Government with modelling on the impact of the aged care reforms which KPMG had undertaken for ACFA.
For information, see:
- Report from KPMG modelling the financial impacts of the aged care reforms; and
- Letter from the ACFA Chairman to the former Government on the findings of the KPMG report.
ACFA provided its final recommendations on accommodation payments to the former Government on 28 November 2012. The former Government's response to these recommendations was announced on 21 December 2012.
Significant Refurbishment Recommendations
ACFA finalised its recommendations on the definition of Significant Refurbishment to the former Government on 21 November 2012.
- Consultation process on Significant Refurbishment
- Final recommendations on Significant Refurbishment
The Aged Care Financing Authority was established on 1 August 2012.