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Unravelling the aged care conundrum

Geoff Helisma | 

Gaining an understanding of how streams of federal funding support the aged care industry is fraught with contradictions.

On one hand, the Member for Page Kevin Hogan has announced several federally funded projects over recent months that will result in better aged care access and increased employment – on the other hand, the Australian Government’s “tighter government funding is driving all operators to run their operations more efficiently”, says Southern Cross Care (SCC), which has facilities in Grafton and Casino.

On the project front, Mr Hogan announced in April that a 144-bed Signature Care residential aged care home in Grafton had secured “$9.36 million in annual funding to support running costs … [that] will create 170 permanent new full time and part time operational positions, plus extra employment in Aged Care support services”.

In November last year he opened the second stage of a $25 million expansion of the Whiddon Group’s Grafton aged care facility, resulting in “about 60 additional permanent jobs”.

Meanwhile, as the next federal election nears, campaigning is underway.

Labor’s candidate for Page, Patrick Deegan, and the Health Services Union (HSU) last week issued media releases critical of cuts to the hours worked at SCC facilities.

Mr Deegan alleges that a reduction of 734 working hours at the facilities will “lead to staff losses and reduced services … such as nursing, laundry, cleaning, care planning, podiatry, dental, hearing aids and recreation”.
“The shift cuts are in direct response to the Federal Government’s aged care funding freeze,” Mr Deegan said.
The HSU says the 734 working hours equate to the loss of 8.5 full-time employees and that the “indexation freeze on the Aged Care Funding Instrument has put further pressure on the aged care sector at a time when it is already struggling to cope”.

HSU NSW’s secretary Gerard Hayes said “industry research showed that in the six months to December 2017, 41 per cent of aged care facilities operated at a loss [and that] in outer regional and remote areas, 58 per cent of aged care facilities operated at a loss”.
Mr Hayes was quoting from the Stewart Brown December 2017 Aged Care Financial Performance Survey, which, in its summary, states, in part: “The financial performance for residential care has declined considerably for the six months ended 31 December 2017.
“This decline is directly attributable to the freeze on the COPE [Commonwealth Own Purpose Expenses] indexation for the 2018 financial year and the other amendments to ACFI [Aged Care Funding Index] effective from 1 January 2017.
As a result, Mr Hayes said “the aged model in Australia is broken”.
“It’s time to rethink the way we fund aged care and look after our older Australians,” he said.
Meanwhile, SCC’s chief executive, Paul McMahon, confirmed that there would be a 734 working hours’ reduction, “noting that these are spread across our 24-hour operations, seven days per week, at each home”.

“Tighter government funding is driving all operators to run their operations more efficiently, and fortunately, Southern Cross Care (SCC) was in the position where we could safely rationalise staffing without reducing care,” he said in an emailed statement.
“Our original staffing ratios were established based on what was a projected level of occupancy and an anticipated level of care needs.
“In many locations, including Grafton and Casino, these projections were not met – hence our higher than industry care and staffing ratios.
“Working with benchmarking provided by national industry financial specialists, Stewart Brown, we sought to rationalise staffing in an acceptable and safe manner.

Mr McMahon said the reductions “included shortening morning and evening service shifts slightly, while maintaining staffing levels throughout peak times”
Other changes include, for example, “a staggered reduction … of hours for some activities and programs”.
He gave assurances that “residents are not missing out on any of their health or care needs”.
“Our staff has been very supportive and flexible,” he said thanking them for “their loyalty and dedication to our residents and families”.
He said his organisation was “working closely in partnership with all levels of government” and that he was “confident” SCC, which has 31 aged care homes, is “well placed to continue caring for older people throughout regional NSW for many years to come”.