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aged care game changer – ideal’s predictions for 2016

2016 will be the game changer year for aged care as the sector responds to the market based consumer driven aged care reforms that continue to be implemented at an ambitious pace.

The Ideal Consultancy predicts eight key areas that will undergo continued change in the coming year.

consolidation

further consolidation through mergers and acquisition in the for-profit sector sales of large portfolios 2016 could well be the year in which a single provider achieves 8000+ operational beds medium sized providers markedly increasing in scale increasing reduction in the number of single site operators increasing consolidation in the not-for-profit sector through both mergers and acquisitions 2016 will see consolidation across some of the denominational and community based providers as they merge with their ‘cousins’ from other states to achieve scale consolidation in the not-for-profit sector will be fueled by The need to achieve operational efficiency through scale The need for capital to replenish / expand / redevelop existing stock The financial impact of the reforms in the home based care sector

investment in aged care

continued interest from those outside …

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australia-china international aged care summit 2015

The Ideal Consultancy Directors Louise Greene and Fiona Somerville will travel to China to participate in the Inaugural Australia-China International Aged Care Summit to be held in Beijing on 16 and 17 November 2015.

about the summit

The Summit is a collaboration between China’s national peak body for aged care and health industries and Austrade will be the first Australian government initiative on aged care and healthcare services since the signing of the China-Australia Free Trade Agreement (ChAFTA) in June 2015. The Summit will provide Australian business with the window to gain access to the world’s second largest economy and its huge potentials in aged care and healthcare spectrums.

The Summit aims to showcase Australian aged care and healthcare capabilities and help Australian product/service providers to understand market demands and future trends in China, share insights and experience, and facilitate bilateral engagements to support potential collaborations and commercial opportunities. Austrade is expecting over 300 delegates from China.

chinese senior living and health (aged care) industry

The Chinese Senior Living and health (aged-care) industry has been described as the ‘Mega Market’ …

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my aged care gateway

From 1 July 2015, older people and their carers wanting to access aged care services and support for the first time need to contact the My Aged Care Gateway. This national call centre will assist people to identify and access the types of care and services that area available.

The types of services include:

Help at home – Commonwealth Home Support and Home Care Packages After hospital (transition) care Respite care for carers Residential aged care homes

A central point of information

My Aged Care gateway is a central information point that:

Provides information on aged care and assists people to find government funded aged care services. Provides a central client record that record eliminating the need for people to ‘re-tell’ their story over and over again. Connects people with an aged care assessment service to determine the care and supports required Connects people with care providers in their area.

My Aged Care can also calculate what fees and subsidies will apply for these services.

The NEW Commonwealth Home Support Program (CHSP)

The Commonwealth Home Support Program offers a mix …

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responding to consumer preference in aged care

The aged care reforms move the sector to a market based consumer driven environment; in this competitive environment consumers have transparent information on price and service offering and are required to contribute to accommodation and care costs. This will significantly reshape consumer (and family) expectations.

While we know that the aged care sector needs to build an additional 20,000 beds over the next six years, it is evident that consumer preferences are driving the need for refurbishment of old and outdated buildings.

let the facts speak for themselves

According to the DPS Guide and Ideal Consultancy national consumer survey of 800+ people (more on that soon), and consistent with The Ideal Consultancy’s (Ideal’s) consumer forums (32 in 2015) and Ideal’s 1,435 Residential Aged Care Mystery Shopping exercises

77% of consumers report their preference is for single room accommodation, with a private bathroom. 17% are seeking Residential Aged Care accommodation that provides additional personal space such as a lounge area or separate living room.

Further, with the publishing of accommodation prices occupancy levels are reflective of consumer sentiment – the …

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plan your aged care business growth

how to plan your aged care business growth smarter

The Australian aged care sector needs massive investment to build capacity to meet future demand for aged care resources. Older Australians have a preference to remain at home, but for some this simply is not possible. At 85 years 22% are in permanent Residential Aged Care; this has declined by 3% since 2004.

allocation of age services

The aged care reforms increase the overall availability of aged care services to 125 operational aged care places per 1,000 people aged 70+ years by 2021–22. Recognizing consumer preference to remain in the community the growth is in Home Care places with the number of Home Care packages to increase to 45 places. The number of Residential Aged Care places will decrease to 80 places per 1,000 people aged 70+ years; and in the future the Short Term Restorative Care and Transition Care Places will be included in the residential aged care planning ratio.

Using robust methodologies to model demand and identify opportunity is imperative for business growth, viability and sustainability.

Whilst not all forecast …

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choice

On February 1 2017 the protected world in which Home Care providers have operated will be unrecognizable.

Where the provider previously allocated a vacant home care package to an eligible and willing consumer they will now need to compete with providers across the nation to ‘win’ the opportunity to provide a home care package to the most worthy waitlisted person in the country.

the market

At 30 June 2015 there were 72,702 Operational Home Care packages provided by 504 Home Care Providers.

The market is highly fragmented across the 66 planning regions:

14 providers operated 1,000 or more packages 58% of providers operated 50 or fewer packages In 18 planning regions there were 50 or more providers however In 12 planning regions there were 10 or fewer providers

today

Currently the market place is protected – the provider holds the package and allocates it to an eligible consumer who is willing to accept a package; if the consumer wants to switch providers they must find themselves another package. Waitlists are strong.

To date the implementation of the Aged Care reforms …

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consumers comment on unfairness in home care packages

From July 2015 Home Care packages must be delivered on a Consumer Directed Care (CDC) basis. The essential features are consumers should have greater autonomy in choosing services that best meet their needs and preferences and transparency and accountability in funding and budgeting at the individual level.

Sounds like a win!

ABC Lateline (29 Sept 2015) highlighted the challenges being experienced. It is early days but consumers in the story struggle to understand why approximately one third of package funding is consumed by administration and case management fees; particularly as under the CDC model they should have the opportunity to take on a greater role in organizing and administering their own package thus reducing these component costs.

The role case management can play in supporting and guiding people to maintain their independence and the need for administration was either not well explained to them or consumers do not perceive a need for or value these elements.

The Commonwealth invests $1.3B (2013-4) in home care packages. Of the 73,550 operational home care packages 81% are delivered by the not for …

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ideal’s top 5 aged care essentials for an incoming minister

Malcolm Turnbull, Australia’s 29th Prime Minister has made sweeping changes to his Cabinet within his first week in office.  While most of the nation seems to have a new spring in its step and a renewed optimisim, here are our recommendations to addressing the aged care industry’s challenges.

Focus on Aged Care. While we welcome a new Social Services Minister, given our ageing population and the impact this will have on the economy, aged care should be much higher on the agenda.  Our elders should be seen as valuable and, as a country, we need to be supporting them, encouraging them to remain in the workforce for longer, that we take ageing seriously and as a country we can best care for people in their later years. Use smart technology to get all systems talking. Address issues quickly and move quickly to a ‘one-stop shop’.  Applications and features need to be user-friendly and easy for customers to navigate and use. Revisit the Productivity Commission Report. There are missed opportunities in the report and, because we are moving towards a ‘user pays’ …

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your guide to a successful acar application

There’s just over a week to go to submit an ACAR application and, with numbers of available places down on average, the quality of a submission will win or lose coveted funded beds or home care places.

In order to present a compelling case for funding, The Ideal Consultancy is providing its expert advice and tips to aged care providers to help them complete the application form in time for next Friday’s deadline.  The Ideal Consultancy is a national management consultancy firm that specialises in the aged care sector.

According to Fiona Somerville from The Ideal Consultancy, it is important to address the key themes, which for 2015 are governance and evidence.  “You must demonstrate that your systems, processes and feedback mechanisms are embedded throughout the organisation from junior staff through to Board level, and that there are robust processes in place for good governance,” she said.  “The Department of Social Services is looking for evidence to support your argument, so reference facts and data where possible and prove how you have established the need for services and the existing …

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the end of acar

The Assistant Minister for Social Services has commented on the flaws of the current ACAR system, noting that it lacks transparency, is inefficient for everyone and that the Home Care reforms have meant that he’s halfway to his goal of eliminating the ACAR process altogether.

At Ideal we wholeheartedly agree with Senator Fifield and believe this will be a step in the right direction for consumers and providers.

While consumers are seeking this it will be imperative to get the foundations right to ensure quality of care is maintained in a less regulated market.

Freeing up choice will expose providers to true market forces – we will inevitably see homes and services that do not meet expectations, resulting in further consolidation.

The key will be in preparing for this change now – while we don’t know exactly what the future looks like it is possible to scenario plan and be prepared. Providers need to develop a clear strategy which may involve exit, growth or the development of niche products and services.

We are truly heading towards survival of the fittest.

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