Normally we kick off the year with an article on the five major upcoming reforms. But this year there aren’t five major reforms – there’s three all-encompassing “mega reforms”. These are the new Aged Care Act, new (“strengthened”) Aged Care Quality Standards and a new model for regulating aged care, all set to become law around July 2024. Here’s what you need to know.

Key Points

• The Government is planning to introduce a new Aged Care Act, strengthened Aged Care Quality Standards and a new Regulatory Model on 1 July 2024.
• The changes are being made in response to feedback from the Royal Commission into Aged Care Quality and Safety, which said that the system should be more focused on the needs of older people.
• The new Act will introduce a new “person-centred” aged care system that includes a Statement of Rights; it will set new obligations for providers and workers and expand the powers of the regulators. The new Act will also provide the legal basis for the strengthened Quality Standards and the new Regulatory Model.
• The strengthened Quality Standards will reduce the number of Standards from eight to seven, consolidate some areas covered by each of the Standards and introduce a new “Food and Nutrition” Standard.
• The new Regulatory Model aims to make regulation more streamlined and less “one-size-fits-all”. Providers will have to meet registration conditions and re-register every three years. A transition period will apply so that providers don’t have to re-register immediately on 1 July 2024.
• A draft of the proposed Act is open for consultation which closes 16 February 2024. The final version will be used to draft a Bill to put to Parliament in July. When that Bill passes Parliament it will become the new Act.
• A final draft of the new Standards was released in November 2023. However, this draft will not become the official version until the new Act is passed by Parliament, and could change between now and then.

What is Changing?

The Act

According to the Department of Health, key changes that affect providers include:

• Providers will have to ensure their actions are guided by the Statement of Rights.
• Providers will have to register with the Aged Care Quality and Safety Commission (ACQSC) (with transitional arrangements in place for existing providers) and have any residential care homes approved.
• Providers who deliver NATSIFAC and CHSP services will be registered under the new Act and regulated by the ACQSC.
• The new Act will provide a revised set of provider obligations including conditions on registration.
• New Aged Care Quality Standards will apply (see below).
• Providers will have to comply with new financial and prudential standards.
• Providers will have to ensure their workforce meets revised worker screening requirements.*
• Providers will be subject to new statutory duties.

According to the Department of Health, key changes that affect aged care workers include:

• The Statement of Rights will include a right for individuals to have services delivered by aged care workers of registered providers who have appropriate qualifications, skills and experience.
• The Statement of Principles will say that the aged care system should support workers to:
  • be empowered to support innovation, continuous improvement and the delivery of high-quality care
  • participate in governance and accountability mechanisms.
• Workers will have increased protections through the expanded whistleblower protections.
• Workers must fulfil and comply with revised worker screening arrangements.*

Other changes to note include:

• New terminology: e.g. “Governing Persons” will now come under the umbrella of a broader term called “Responsible persons”; “Representatives” will be called “Supporters and Representatives”.
• Subcontractors: the Act will include a set of key obligations that apply to registered providers and apply even where registered providers subcontract the delivery of services to associated providers.
• Operators of digital platforms: specific obligations will apply to operators of digital platforms that facilitate access to aged care services.
• Regulatory system: the new aged care system will be governed by the Secretary of the Department (System Governor) and the Aged Care Quality and Safety Commissioner (Commissioner), who will both have expanded regulatory powers.
• New Complaints Commissioner: the new Act will establish the new Complaints Commissioner with the aim of ensuring a more "person focused” complaints process.

*According to the consultation paper on the Act, the new worker screening requirements might not commence at the same time as the other requirements in the Act: “Before the new worker screening model can be implemented, new legislation is needed at the state or territory level … During the transition period, existing obligations in relation to worker screening (that is, police check requirements) will continue.”

The Standards

The proposed changes will reduce the number of Standards from eight to seven, and consolidate some areas covered by each of the Standards. According to the Department of Health, the strengthened Standards will be:

• Standard 1: The Person
• Standard 2: The Organisation
• Standard 3: The Care and Services
• Standard 4: The Environment
• Standard 5: Clinical Care
• Standard 6: Food and Nutrition
• Standard 7: The Residential Community

Each Standard will include the:

• expectation statement for older people
• intent of each standard
• outcomes that providers would be assessed against
• actions – which are how providers might demonstrate achievement of the outcome (these will replace the “organisational requirements” in the current Standards). There are 152 of these in the strengthened Standards.

The Regulatory Model

According to the Department of Health and Aged Care, the new model will be:

• rights-based
• person-centred
• risk-proportionate
• focused on continuous improvement.

Key changes and points to note include:

• All providers will need to be registered through a new provider registration model. Registration is expected to be for three years.
• Transition period: on 1 July 2024 when the new model commences, existing providers will be “deemed” to be registered and won’t have to go through the registration process immediately. The Department of Health and Aged Care will then talk with providers and give them a date for re-registration. Timeframes will be staggered so that the Department doesn’t have to organise everyone’s re-registration at once.
• Non-corporations, such as sole traders and partnerships, will be eligible to register to as providers.
• To move on from an inappropriate “one-size-fits all” system, the new model will classify services into registration categories based on similar risk and service characteristics. This means that services that are lower risk (such as meal delivery services) will face fewer obligations than higher risk services such as residential care.
• Providers will be expected to act consistently with the Statement of Rights and Principles outlined in the new Act and have practices in place to ensure they are able to do so.
• Some providers (e.g. residential care) will also have to comply with requirements such as “ongoing business improvement” and Financial and Prudential Standards.
• Transparency of sector and provider performance will be improved via a new public register of registered providers and published sanction information.

Why are the Changes Being Made?

The changes are being made in response to recommendations from the Royal Commission into Aged Care Quality and Safety.

The Act

The Royal Commission found that the current Aged Care Act is no longer fit for purpose. According to the Commission’s final report:

“Much has been said during our inquiry about the need to ‘place people at the centre’ of aged care. To achieve this, we are convinced that a new Act is needed as a foundation of a new aged care system. The new Act must focus on the safety, health and wellbeing of older people and put their needs and preferences first. It should provide an entitlement to the support and care each individual needs to prevent and delay the impairment of their capacity to live independently.”

The Standards

The Royal Commission found that the existing Standards only set out minimum acceptable standards for accreditation and do not motivate and empower providers to achieve high quality care and outcomes for older people. The Commission identified several areas for improvement in relation to the Standards, including:

• governance
• diversity
• dementia
• food and nutrition
• clinical care.

The Regulatory Model

According to the Royal Commission a new way of regulating the industry must be developed because:

“Ineffective regulation has been one of the contributing factors to the high levels of substandard care in Australia’s aged care system. Regulation should seek to prevent harm to people receiving aged care services and ensure that instances of substandard care are detected and addressed.”

More Information

• Department of Health and Aged Care: New Aged Care Act
• Department of Health and Aged Care: What the new Aged Care Act may mean for you
• Aged Care Quality and Safety Commission: New Aged Care Act
• Department of Health and Aged Care: The Aged Care Quality Standards
• Aged Care Quality and Safety Commission: Stronger Standards, Better Aged Care Program
• Aged Care Quality and Safety Commission: Strengthened Quality Standards framework analysis
• Department of Health and Aged Care: About the new model for regulating aged care
• Department of Health and Aged Care: A new model for regulating Aged Care – Summary Consultation Paper No. 2