Aged care funding boost passes parliament

nurse giving cup of tea to resident in aged care home

Australia’s aged care sector is getting a much-needed cash injection after a $500 million funding package passed through parliament.

The aged care reform bill introduces a $508 million funding model for the sector (over four years), an aged care star rating system and a new code of conduct. It also establishes an independent aged care pricing authority.

The amount represents a roughly 10 per cent increase in funding and will be delivered under a new spending formula designed to better reflect the needs of residents.

The boost will be welcomed as aged care residents recently saw the cost of care rise when the Maximum Permissible Interest Rate (MPIR) jumped from 4.07 per cent to 5 per cent on 1 July.

Read: More defence personnel to plug holes in aged care

The MPIR is a government-set interest rate used to calculate daily accommodation charges at age care homes. It’s tied to the economy-wide Consumer Price Index (CPI), which has gone through the roof recently.

The Aged Care and Other Legislation Amendment Bill 2021 is the first piece of legislation to pass parliament under the Albanese government.

Aged care minister Anika Wells told reporters Australia needed to rethink the way it treats its senior citizens and that aged care would not improve until it was properly valued by society.

Read: Health and aged care job vacancies at critical levels: report

“Today, the 47th parliament passed its first bill,” she said.

“We made a promise to Australians that we would take better care of their loved ones and restore dignity to our most vulnerable citizens.

“Reforming aged care will take years, but this bill is a first step on the journey.”

The new legislation is a result of the 2018 Royal Commission into Aged Care Quality and Safety – one of two bills to come out of the commission – with 14 of the report’s recommendations codified in the bill.

Read: Omicron chaos may have killed more in aged care than COVID

This bill is actually a remnant of the previous parliament, having first passed the Senate in March, shortly before the election.

Under the second aged care bill, currently still being considered by parliament, residential aged care facilities will be required to have a registered nurse on site 24 hours a day. The bill also mandates a minimum of 215 minutes of personal care each day, for each resident.

Prime Minister Anthony Albanese told the Australian Financial Review the two pieces of legislation would ensure older Australians were getting the care, dignity and respect they deserved.

“Having an aged care bill in response to that royal commission become the first to pass through parliament shows how seriously we take reform in the sector,” he said.

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