Xenophon Calls for Aged Care Funding Inquiry

Independent South Australian Senator Nick Xenophon has called for a Senate inquiry into aged care funding, condemning the two major parties for their federal election mandate on the issue.

Xenophon announced on Wednesday that, if reelected, he would move to delay the $1.2 billion budget cut to the Aged Care Funding Instrument (ACFI) until there was a senate inquiry into the sector.

He also called for the Coalition to scrap its planned budget cuts and for Labor to revoke its support for the measures, which he said would put lives at risk and cause massive cost blowouts to Australia’s health system.

“These consequences have not been thought through, they are savage cuts that have the potential to affect hundreds of thousands of Australians – of frail, vulnerable Australians – and it’s simply not acceptable,” Xenophon told Pro Bono Australia News.

“It hasn’t been thought through, Labor and Liberal [have the] immunity ticket on this. It’s a cruel cost-saving measure.

“It’s [the inquiry] going to be one of my first priorities if I’m reelected into the Senate, along with any of my colleagues.”

He said the cuts would also cost taxpayers more money because the states would “end up getting a much bigger health bill”.

“Talking to the Not for Profit sector indicates that there are many unintended consequences in respect of the cuts, and the actual effect of the cuts will be closer to $1.8 billion over the next four years,” Xenophon said.

“There is no doubt that there will simply be cost shifting between the Commonwealth to the states as more aged care facilities will be unable to treat complex health care (CHC) patients because payments have been slashed and they will be pushed on to the state health system.

“Considering that differences of about $165 a day in Commonwealth funding compared to $1,000 in a hospital, it is the worst sort of false economy. There needs to be a sensible review of the Aged Care Funding Instrument and for the government to pause these cuts immediately.”

If the inquiry goes ahead, Xenophon told Pro Bono Australia News he would work with aged care organisations on recommendations for reform.

“I think we need to sit down with the sector first and listen to the sector to say, this won’t work, there will actually be massive cost shifting, and the states need to be involved as well,” he said.  

AnglicareSA CEO Peter Sandeman told Pro Bono Australia News the proposed cuts would have “dire consequences” for those in aged care, supporting the call for a Senate inquiry.

“It’s timely for the review of aged care funding to be brought forward and that this funding cut be suspended until such time that the inquiry can be held,” Sandeman said.  

“The inquiry needs to provide not only for appropriate funding for recurrent aged care, but to ensure that the smaller, regional facilities are viable into the long term, and also that adequate provision is made for capital replenishment.

“Many aged care organisations are able to fund their day-to-day operations but they’re unable to put money aside for future refurbishment. And unless this is included there will be a deterioration of aged care facilities and an inability to rebuild facilities when they need to be replaced.”

He said he would like all political parties to commit to reversing the funding cuts and to support an aged care funding review.

The sector’s peak body, Aged and Community Services Australia (ACS), also backed Xenophon’s call for an inquiry.

“The Senator’s support to oppose the measures offers a lifeline to aged care providers, who are extremely concerned about what the cuts will mean for those frail older residents with high needs in their care,” ACS SA and NT CEO Melissa Centofanti said.

“The Senator understands that real reform is essential when we are talking about funding the care and support of frail older Australians when they need it most, and a proper examination of how much it actually costs to deliver care is essential.

“An examination of aged care funding and a model for sustainable funding would allow the sector the opportunity to have a real long-term plan for stability and growth – both of which are lacking in the current environment – where sudden and unannounced cuts to funding are causing instability in the sector and for those we care for.

“This election is a real chance for all parties to support measures to ensure Australia has the best aged care system in the world. It’s time for the care and support of older Australians to be a national priority.”

Sandeman also expressed concern for the impact of the July rollout of the National Disability Insurance Scheme (NDIS) on older Australians.

“The interface between the NDIS and aged care funding appears not to be well articulated, or at least not well understood,” he said.

“It would appear that should an older person need to transfer from one to the other inequities will arise both in terms of eligibility and in terms of terms of level of support.

“Particularly in community-based aged care and community-based NDIS it would be useful that the same need for assistance generates roughly amounts of funding.”