It is expected that those aged 65 and over will comprise of 15 percent of the population by 2050,
for OECD countries, placing our country in a more than befitting position for a reassessment of
our aged service sector. Albeit Australia has been accredited as a leading model of care for the
aged, there is much room for improvement and development. Moreover, the sector continues to
be confronted by ever-changing and robust changes.
For most of the population, publicly funded Long Term Care (LTC) is largely accessible, and the
number of aged care customers using home care and home support have risen by 8.6% and
24.5% respectively in 2016. As the focus has shifted to a need, the challenge now lies in
ensuring a larger pie of the aged community is able to enjoy such services. As more Australians
enter into aged care, there has been projected deficit for care homes, beds and carers, and
government bodies and providers alike are operating on overrun expenditure and overheads.
There is a need for improving the overall social infrastructure- both hard (facilities) and soft
Additionally, aged care services have been met with changing expectations beyond a traditional
‘nursing home’. With today’s generation of seniors’ favoring small homes accommodating for
greater quality of life and a tight-knit community, the business model for providers across the
board have converged into centering the design configuration around co-located home cares
integrating retail, exercise facilities and leisure with everyday living; visibly with proximity to the
city fringe in mind. A more livable environment emphasising hospitality and adding value has
taken over to become a more sustainable framework.
Due to the aforementioned changes, past funding efforts (more specifically the Aged Care
Funding Instrument (ACFI) ) have become less fit for purpose. A host of new systems have
been initiated, with implementation introduced through carefully defined stages. Standard per
diem (‘fixed’) care payments covers costs of ensuring equal capacity and care for all home care
residents, variable payment covers costs of individualised care for residents – also covering the
care that some residents receive but not others, and Activity Based Funding (ABF) will be the
model used to fund this variable component. Providers also continue to emphasise the need for
greater consumer autonomy over aged care funds, as has been since implementation of The
Consumer Directed Care Approach which puts the elderly in charge of his or her allocation of
funds. Putting the individual in primary position of decision-making allows for easier allotment of
government funding needed to account for any shortfall. Overall the government body and key
stakeholders are working towards short, medium and long-term funding actions aimed at
attaining greater funding stability.
A booming $21.5 billion industry revenue market, aged care in Australia continues to prosper
and therefore also demand assiduity to resources allocated and the framework it operates
within. Business models that challenge the status quo wherein benefits will be enjoyed by end
consumers rather than facilitators are a more far-sighted progression.
Jazreel Lee, My Care My Choice