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New aged care legislation – expose draft released

Article published on: 15-12-2023

An exposure draft of the new Aged Care Act has been released for public consultation with a proposed commencement date of 1 July 2024. 

The changes that relate to the home care system will be staged and come into effect from 2025. The changes need to be legislated by Parliament to come into force. A number of changes are proposed to the existing Government subsidised home care and residential aged care system (which will be referred to as the ‘funded system’). This includes changes to the way needs are assessed, allocation of support services and eligibility to access care.

No information on fees 

The exposure draft does not address changes to fees, payments or means-testing arrangements. It also doesn’t contain any grandfathering for existing care recipients. Whilst fees and charges are under consideration by the Aged Care Taskforce, they don’t form part of this consultation. A report from the Taskforce is expected to be published shortly, which should contain information on the proposed fee structure. 

Proposed changes of interest for advisers and clients

The new Act contains a number of changes relating to the management and governance of the aged care system and the rights of care receivers. You can read about these aspects by accessing the resources below. Listed below are areas of interest to advisers and clients. 

  • The Commonwealth funded aged care system will only be available to individuals aged 65 or over (or First Nations or homeless individuals aged 50-64 where alternatives to residential aged care have been explained).
  • From 1 July 2024, there will be a single assessment process for entry to all home care and residential care services.
  • The current Commonwealth Home Support Programme (CHSP), Home Care Program and Short-term Restorative Care Programme (STRC) will be amalgamated to provide a single ‘Support at Home Program’. This will commence in 2025 for the STRC and no earlier than 2027 for CHSP. 
  • Additional home care services will be available for people with higher levels of care needs. Some services (such as the provision of support and safety aids and home modifications, as well as palliative care) will be available in addition to a person’s home care budget. Currently, these expenses need to be funded from the person’s approved home care budget and reduce the funding available for other home care support services.
  • Support will be available for both short term needs, and where ongoing services are required. It will be possible for multiple individuals to pool their home care budgets (for example, in a retirement village) to access greater levels of services (such as an onsite nurse).
  • It will be possible for a care receiver (or the Department on their behalf) to appoint a nominee to seek information on the care receiver’s behalf. A person may also be appointed as the person’s representative to make certain aged care decisions on the care receiver’s behalf.

Department of Health and Aged Care Resources

We will provide an update as additional information becomes available, including detail about the proposed changes to fees and means-testing. The Department has made available the below resources which may be of interest:

  • Webinar slides from 14 December 2023
  • A new aged care act: FAQs
  • Phases of aged care reform
  • Who will be able to access Commonwealth funded aged care
  • Steps for making a proposed nominee arrangement under the new Aged Care Act

This communication is prepared by Actuate Alliance Services Pty (ABN 40 083 233 925, AFSL 240959), a related entity of MLC Wealth Limited (ABN 97 071 514 264). This is for financial adviser use only – it is not to be distributed to clients. The communication has been prepared to provide financial advisers with technical resources, support and knowledge. The information in this document is current as at the date of publication and reflects our understanding of existing legislation, proposed legislation, rulings etc as at the date of issue, and may subject to change. In some cases, the information has been provided to us by third parties. Whilst care has been taken in preparing this document, no liability is accepted for any errors or omissions in this document, and loss or liability arising from any reliance on this document. Any general tax information provided in this publication is intended as a guide only and is based on our general understanding of taxation laws. It is not intended to be a substitute for specialised taxation advice or an assessment of your liabilities, obligations or claim entitlements that arise, or could arise, under taxation law, and we therefore recommend your client consult with a registered tax agent.
 

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