Will an aged care funding proposal where the rich can pay for extra services and amenities in aged care while the poor receive the basics, lead to a two-tier system of the haves and have-nots?
At least one senior's organisation believes it's possible.
Samantha Edmonds Older Person's Advocacy Network's Director of Policy and Systemic Advocacy said it is critically important that we don't create a two-tiered system, "where those who can afford to pay get a first-class service, and those who can't afford to pay receive inadequate care."
Ms Edmonds was referring to the newly released final report of the Aged Care Taskforce which has been looking at how the country can best fund its burgeoning aged care bill.
Among the recommendations is one for fee flexibility which would enable residents to elect to pay for better or additional everyday services by negotiating a higher Basic Daily Fee with their provider.
"Provided appropriate consumer protections and complaints processes are in place, the taskforce considers there is value in providing flexibility for residents, or their representatives, to negotiate a so they can access additional services or amenities, if they have the willingness and means to pay," said the report.
However, Ms Edmonds said, "During the consultation process our message was clear, we must ensure equitable access to aged care services, especially for our most vulnerable people, regardless of their capacity to pay.
Safety net
"We also called for strict safety net provisions to ensure our most vulnerable older people don't fall through the cracks."
The taskforce's final report has recommended the government remain the primary funder of aged care, but people receiving services, and who can afford to, such as those wealthy retirees with superannuation would be asked to contribute more towards the cost of things they have typically paid for their whole lives - like accommodation, living expenses and some home care services and they could elect to pay more for better services.
Suggestions for a taxpayer levy or an increase to GST have been rejected by the taskforce as creating substantial intergenerational equity issues.
The 23 recommendation report said superannuation was designed to support people to grow their wealth and fund the costs associated with retirement including aged care.
Responding to the report the government has confirmed it will not impose any increased taxes or a new levy to fund aged care costs or change to the means testing treatment of the family home for aged care.
"We will continue to analyse this report and finalise our response to its other recommendations," said Aged Care Minister Anika Wells.
Currently government funding constitutes around 75 per cent of the total costs of residential aged care funding, and 95 per cent of home care which the taskforce does not consider optimal or fair.
Fees
There are three core fees in residential aged care: means tested care fees; the Basic Daily Fee, which covers the majority of everyday living expenses, currently 85 per cent of the single basic Age Pension; and accommodation costs which cover the cost of the room and capital expenses, payable as a daily payment or a fully refundable lump sum.
The taskforce recommends expanding government funding to fully fund the care fees so residents would not have to worry about being able to afford to pay for their assessed direct care needs.
It also recommends a greater co-contribution towards items that people have more likely paid for throughout their lives, like accommodation and daily living expenses.
The report said aged care providers are on average losing $4 per resident per day on daily living activities. Two-thirds of residential aged care providers reported a net loss, equating to $2.26 billion in 2021-22 largely due to losses in accommodation activities.
"There is therefore a critical need for increased funding towards everyday living expenses. The taskforce believes this should be largely paid for through greater resident co-contributions to ensure sustainability, but with a strong means tested safety net for those who cannot pay a higher rate, such as full-rate pensioners with no other income or assets."
The report also covers the funding of homecare with a recommendation of a fee-for-service model for the proposed Support at Home program that ensures participants only pay a co-contribution for services received.
Support at Home
The Support at Home Program needed much clearer specifications than current programs about what it will and will not fund, said the report.
The taskforce's proposed system would have inclusion and exclusion service lists with those included being services assessed as essential or necessary for health, independence or safety in the home; and excluded services goods or supports that people are expected to cover out of their general income throughout their life regardless of age or wealth such as accommodation costs and utilities.
Aged and Community Care Providers Association welcomed the report saying half of residential aged care providers cannot make ends meet and are currently losing money on each and every resident. The viability of home care is also trending down, with providers barely keeping their heads above water.
"Chronic underfunding of aged care goes back decades, and has made the sector unsustainable," said ACCPA chief executive Tom Symondson.
"Aged care in Australia cannot continue to muddle along with band-aid solutions while the system crumbles. We need a sector that's set up to improve the lives of older Australians now and into the future. They deserve better, and the recommendations of the Taskforce will help deliver that."