New Aged Care Response to Royal Commission Bill passes Parliament

smiling seniors talking over tea with their retirement home nurse

This article applies to aged care providers.

Aged Care and Other Legislation Amendment (Royal Commission Response) Bill 2022 (Cth)

Please be advised that the Aged Care and Other Legislation Amendment (Royal Commission Response) Bill 2022 (Cth) (the Bill) passed Federal parliament on 2 August 2022 and received royal assent on 5 August 2022. Schedules 3, 4, and 5 of the Bill are due to commence on 1 December 2022, with the remaining provisions to commence on the day after the Bill receives royal assent.

The Bill amends the Aged Care Act 1997 (Cth) (the Act) and the Aged Care Quality and Safety Commission Act 2018 (Cth) (the Quality and Safety Commission Act) to make several time critical aged care measures in response to the recommendations of the Royal Commission into Aged Care Quality and Safety (Royal Commission) Final Report. The key amendments are outlined below.

Residential Aged Care Funding

Schedule 1 of the Bill introduces the Australian National Aged Care Classification (AN-ACC) funding model to replace the Aged Care Funding Instrument and provide a new residential aged care basic subsidy calculation model. The new model will include a fixed component for all residents at a residential care service and will be higher for certain specialist services and those in remote locations, to reflect the higher operating costs. This model will align a calculation of a fixed amount of subsidy based on the care recipient’s AN-ACC classification.

Star Ratings

Schedule 2 of the Bill amends the Act to introduce a star ratings system based on measurable performance indicators of aged care service providers. The Secretary of the Department of Health and Aged Care (the Secretary) will be required to publish information on the quality of aged care provided at aged care services, using the star rating system. This is designed to increase the ability of consumers to conduct comparisons of the quality and safety of aged care services, and ultimately improve transparency and accountability.

Code of Conduct

Schedule 3 of the Bill inserts new Part 8AA into the Act to establish a Code of Conduct (the Code) that must be complied with by approved providers and their governing persons and workers. Failure to comply with the Code will result in a civil penalty of 250 penalty units (currently $45,435).

Subscribers should note that the Bill also amends the Quality and Safety Commission Act to give the Aged Care Quality and Safety Commissioner (the Commissioner) powers to take action in relation to compliance with the Code, including broader powers to issue civil penalties or banning orders for substantiated breaches. Importantly, under section 74GB of that Act, the Commissioner will be able to make a banning order prohibiting or restricting an individual who is or was an aged care worker, a governing person or an approved provider from being involved in the provision of any type of aged care, or from engaging in specified activities in their role. A breach of a banning order will attract a civil penalty of 1,000 penalty units (currently $181,740).

Extension of Incident Management and Reporting

Schedule 4 of the Bill will extend the Serious Incident Response Scheme (SIRS) from residential care to home care and flexible care arrangements that are delivered in a home or community setting. This creates new responsibilities for approved providers of home care, and flexible care to manage incidents, including the implementation and maintenance of an incident management system that complies with the Quality of Care Principles.

Governance and Reporting

Schedule 5 of the Bill introduces new governance responsibilities for approved providers in relation to the membership of their governing bodies, the establishment of new advisory bodies, and measures to improve leadership and culture. These measures are designed to improve transparency and accountability and ensure the focus of approved providers, at all levels of an organisation, is in the best interests of its care recipients.

Schedule 5 also introduces new reporting requirements for approved providers to give information to the Secretary about their operations annually. It is intended that the information given to the Secretary will be made publicly available in order to help care recipients and their families to understand key details of approved providers and again, increase transparency of information about approved provider’s operations.

Schedule 5 will also require approved providers to notify the Commissioner of changes to key personnel and will replace the current disqualified individual arrangements with a suitability test, based on certain suitability matters, for key personnel. These amendments are designed to ensure that the Commissioner can make a determination regarding the suitability of an approved provider’s key personnel.

Suitability matters may include but are not limited to the individual’s experience in providing aged care, and whether the individual has been convicted of an indictable offence or has an NDIS banning order in force.

Key personnel of an organisation are defined under section 8B of the Quality and Safety Commission Act to include any person who is:

  • responsible for the executive decisions of the provider; or
  • has responsibility for or significant influence over planning, directing or controlling the activities of the entity; or
  • responsible for the nursing services provided by the provider; and
  • responsible for the day-to day operations of the service.

Restrictive practices

Finally, schedule 9 of the Bill introduces interim arrangements regarding the use of restrictive practices, that were previously strengthened on 1 July 2021, to address unexpected outcomes in relation to the interaction with State and Territory guardianship and consent laws. Specifically, this includes an immunity provision for approved providers and individuals from civil or criminal liability if informed consent to the use of restrictive practice was given, and the restrictive practice was used in the circumstances specified in the Quality-of-Care Principles.

Please click here to access the full Bill.

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