Aged care report card

Summary of our analysis

Introduction

The Aged Care Act 1997 heralded a major change in the provision of aged care in Australia. Care of the aged and infirm was turned into a commodity which was able to be traded in the market place. It is astounding that, ten years later, the Department of Health and Ageing has provided no detailed evaluation of this major development which has affected so many frail, older Australians. A lack of full transparency by all authorities responsible for monitoring this process has prevented other interested parties from doing so.

The Aged Care Crisis Team now calls for a complete, open review of the Aged Care Act 1997, and asks for a thorough examination and analysis of all aspects of aged care. The sector, and those it serves, deserves no less.

The Aged Care Crisis Team has gathered information from various sources during the last few years but it is necessarily incomplete. We were stimulated to closely examine some of this data as documents in our possession indicated that more than twice the number of facilities failed full accreditation than the 46 claimed by the Minister for Ageing in her media releases.Based on the limited information that is publicly available, the data may not be contemporaneous and these findings are tentative.

What is clear is that useful information, on which public policy and democratic debate should be based, is not fully available to public scrutiny. Particularly worrying is that a system based on market place dynamics conceals the information which citizens require to make effective decision making. Frail citizens and their families are therefore unable to make rational choices when selecting a nursing home. As well, hospital and community social workers are unable to appropriately advise them.

Many families contact the Aged Care Crisis Team about failures in care. We suspect that the incidence of failure is far higher than that detected and published by the Aged Care Standards and Accreditation Agency and the Department of Health and Ageing. At present we have no way of confirming this.

We stress that there are two issues here - the validity and effectiveness of the accreditation process and the actual accreditation findings. Our present analysis examines the assessment findings but does not address their validity or effectiveness.

The data

The Aged Care Crisis Team had collected reports on 108 aged-care homes in which one or more of the 44 accreditation standards were found wanting and/or sanctions were imposed during the period when the Minister reported just 46.

A list of the 108 aged-care homes in this analysis is provided further down this page. The analysis appears to be representative and we believe give an indication of trends within the sector.

We have included those aged-care homes where our records show that they failed non-compliance between 1st July 2007 and 30 June 2008 and/or were sanctioned during this period indicating that failures persisted. Earlier failures were excluded unless sanctions were imposed during the study period. We note that some nursing homes and hostels, particularly in rural and remote areas, although having similar names, are separately registered and assessed. They appear to be co-located but separate. We have treated them as such.

We have analysed this information looking for pointers to what is happening. Further studies based on complete data are urgently needed to confirm the validity and the independent impact of the different factors examined.

Analysis

Distribution of aged-care homes

As of June 30, there were 2,838 Commonwealth-funded aged-care homes in Australia. The proportion of aged-care homes, expressed as a percentage figure, is shown in Figure 1 (below).

The Minister's report and other data available to us indicate that not-for-profit groups operated 1,698 (59.7%) homes. Of these 821 (29%) were run by religious groups, 481 (17%) by charities, and 396 (14%) by community based groups.

Governments operated 198 (7%) and private-for-profit operators 942 (33.7%). This categorisation is based on a document which we believe originated within the Department of Health and Ageing.

Distribution of aged-care homes not meeting at least one required standard

The distribution changes when the 108facilities that failed at least one accreditation standard are examined. Private-for-profit 47 (44%), government 12 (11%) and community-based not-for-profit 23 (21%) each had an increased proportion of the failed homes. In contrast, charitable 10 (9%) and religious not- for-profit 16 (15%) had a much smaller proportion. They accounted for only a quarter of the failed aged-care homes even though they operate nearly half of all aged-care homes (Figure 2)

In Figure 1 (left), the proportion of all 2,838 Australian nursing homes by approved provider type (left) compared with Figure 2 (right) the proportion of 108 Australian nursing homes that had some non-compliance by approved provider type. Note that the charitable and religious groups have halved the proportion of the failed homes whereas the other three have increased indicating that the problem homes lie mainly here.

Incidence of failures

Using the figures above it was possible to calculate the proportion of aged-care homes failing an accreditation standard in each group and then compare the rate of accreditation failures for each to give an indication of performance in Figure 3 (below):

The best performers were the charitable and religious not-for profit sub-groups. They had less than half the rate of private-for-profit providers and almost one third the rate of government-run and community-based not-for-profit aged-care homes.

A more accurate, but still not fully comparable comparison between the private-for-profit and not-for-profit providers, is given by comparing the for-profit private providers with the charitable and religious not-for-profit groups only. The latter operate fewer peripherally located failing services (23%) than the government and community based groups (63%). Only 4% of the failing private-for-profit providers are peripheral with 96% central. When compared with the charity and religious groups, the private-for-profit operators had more than double the proportion of failing homes - see Figure 3 (above).

Number of standards failed

The average number of the 44 accreditation standards failed did not differ much between the various groups. The charitable and not-for-profit religious organisations had fewer but the numbers were insufficient to draw any firm conclusions.

Government operated aged-care homes averaged 10.7 failures, community-based not-for-profit 9.7, not-for-profit charitable 6.0, not-for-profit religious 6.9 and private-for-profit 9.0.

The impact of distance

Isolation by distance from major centres and medical services is likely to be associated with limited management resources, fewer trained staff, and less oversight by parent organisations and other bodies. They are therefore at a disadvantage.

The differences in distribution between peripheral groups of aged-care homes in outer regional, remote and very remote areas - when contrasted with central groups comprising inner regional and major city areas - is striking. These readily account for the differences seen between the government and community-based groups on the one hand and the charitable and religious groups on the other. Both are more likely to serve those in need in their own localities.

Figure 4 (above), shows the proportion of the 108 nursing homes failing at least one standard owned by each sort of provider group in central and peripheral areas.

The impact of private-for-profit control of aged care

As a more peripheral location clearly was associated with failures in standards we re-examined the data after excluding all of the peripheral facilities. To get the information we needed we used a different data source with 2,937 (107 more facilities) listed in Australia. This was not a significant difference, We excluded 427 peripherally located facilities leaving 2,510 more central ones for analysis. When we excluded the 30 peripherally located aged-care homes that had failed a standard we were left with 78 that were centrally located. The distribution of both groups by provider group as well as the rate of failure is shown in Table 1 (below):

The percentages of failed aged-care homes graphed in Figure 5 (below) can be compared with Figure 3. The bias created by distribution has disappeared so that government and not-for-profit subgroups now perform similarly.

The private-for-profit sector stands out with more than twice the incidence when compared with government, over three times when compared with all not for profits and almost four times when compared with the largest not-for-profit group, the religious providers.

Figure 5 (above): Note that the change in distribution in each group differs from our first analysis (Figure 3), in that the private-for-profit sector has more than double the rate of failing aged-care homes than all the other groups which now perform comparably.

Discussion

The data indicates that peripherally located nursing homes are disadvantaged and need greater integration and support.

The size of the provider organisation and the managerial resources and experience it can bring to its operations are clearly important. Our impression is that providers with fewer aged-care homes are both more likely to fail accreditation standards and more likely to have more than one home fail. The complexity of the managerial and corporate structures in both the private-for-profit and the not-for-profit sectors coupled with the lack of transparency in these matters would make any attempt to analyse or draw firm conclusions in this regard from our limited data prone to error. We have not attempted to do so.

In looking at factors other than the provider type that might influence the results and produce the other changes, we feel that the imbalance in our outcomes might be partly biased in that the not-for-profit religious and charity subgroups have fewer small operators who also seem to be more at risk. It is unlikely that this would account for all the difference. If this is so, then this has policy implications.

Private-for-profit operators generally serve the more affluent sections of the community in centrally located areas. We feel that they should not lack for resources or community support. As indicated earlier we did not have the information needed to evaluate the impact of these and other factors. The market makes claims to greater efficiency but if so then these results suggest that this does not extend to improving accreditation outcomes. It is clearly essential that these results be validated by a much larger study including all the data from the last 3-4 years and including an assessment of corporate and management size and structure.

We are deeply concerned that these findings are a consequence of the diversion of financial and human resources from the care of residents to the care of profits. The industry's own figures lend support to our concerns. The December 2008 Aged Care Association of Australia's (ACAA) submission (pages 6-7, Graph 2-Graph 3) to the Australian Senate Finance and Public Administration Committee reveals that the profit margin of for profit nursing home operators (16%) is double that of not-for-profit operators (8%). It also reveals that private-for-profit providers make three times the net profit from each bed ($3,000 vs $1,000). Our results suggest that this has consequences.

We are also concerned that this may be a red flag pointing to a pervasive change in ethos and a consequent malaise in the sector; a malaise, pointed to by the number of nurse whistle blowers, falling staff levels, rising community concern and the succession of scandals since 2000. If these findings are replicated in a more thorough study then this would be a serious indictment of the policies embarked on in 1997.

In the USA, where far more detailed information is publicly available, most studies comparing not-for-profit and privately-operated corporate owned aged-care nursing homes have, over the years, found that the latter have about 3 times as many problems. It is interesting that our findings are similar. We suspect that a more comprehensive study would confirm this as well as identifying the impact of other factors.

Conclusions

The admittedly limited data available to us indicates that government and community-based not-for -profit operators have more than double the incidence of aged-care homes failing at least one accreditation standard when compared with other not-for-profit providers. This is readily accounted for by the number of facilities located in more remote areas of Australia.

Private-for-profit operators which operate almost entirely in central areas have a similarly higher incidence of aged-care homes not meeting required standards. It has not been possible to evaluate all of the factors which might impact on this. It concerns us that the difference may be because human and financial resources are being diverted from the care of residents to the business of extracting profits from the sector.

Further investigations to confirm the validity of these findings and to evaluate the impact of the other factors at work are required. We urge the government to make data publicly available so that academics and members of the community can bring their many skills to an evaluation of the issues, and their talents to addressing the way ahead. The baby-boomer aged-care bulge is upon us and to do otherwise would be irresponsible. We cannot afford to squander our country's talents.

Comments on the data

We are somewhat confused by the varying use of terminology within the Minister's media releases and announcements. We assume that, although the Minister refers to 46 homes that failed to meet required standards in her media release of 25 November 2008 [Release of annual report – Operation of Aged Care Act 2007-2008], she was actually referring to both nursing homes and hostels – 1.6 percent of all aged-care homes.

Comments on the lack of transparency

An unfulfilled promise: The Rudd government has promised greater transparency in all spheres of government but there is little evidence of this within the aged-care sector. We believe that the issue of increased transparency was largely ignored in the November 2008 revision of the Aged Care Act 1997. It is our view that both the Accreditation Agency and the DHA should collect and collate all information relating to the provision of aged care and ensure that it is readily accessible to all. We also believe that there must be far more involvement from communities and much more community input into all aspects of aged care – including the accreditation process.

Accreditation and transparency: The current limited system of late release and early removal of adverse reports from the Aged Care Standards and Accreditation Agency website is unsatisfactory. Consumers are entitled to disclosure of all past, as well as present, reports. Information needs to be presented in a digestible format. As already stated, frail older people are one of the most vulnerable groups in society and their protection should outweigh all other considerations.

In order to achieve this protection, community members must be able to see what the company or provider is capable of when no one is watching - not just when they have been given time to prepare for an inspection and not simply after providing a response to an adverse finding in order to stay in business.

Minister's media release

Release of annual report – Operation of Aged Care Act 2007-2008
MEDIA RELEASE: 25 November 2008

The Minister for Ageing, Mrs Justine Elliot today released the annual report into the Report into the Operation of the Aged Care Act 2007-2008.

It showed 300,000 Australians received care through the record support for the aged and community care sector provided by the Rudd Labor Government.

Currently, there are some 2.8 million Australians – about 13 per cent of the population – aged 65 and over. This number is expected to triple in 40 years.

"Australia has the world's second longest life expectancy and the Australian Government is responding to the challenge of an ageing population," Mrs Elliot said.

"Over the next four years, the Australian Government will invest more than $41.6 billion into aged and community care. We will provide on average $41,500 a year a resident in subsidies. No Government has invested more into this area than the Rudd Government.

"We want to ensure the long-term viability of the aged sector, but also ensure that there are quality and accreditation standards to protect vulnerable members of our society," Mrs Elliot said.

In 2007-2008, more than 300,000 people received a form of aged and community and the Federal Government provided $8.3 billion for ageing and aged care in Australia.

As of June 30, there were 2,830 nursing homes and hostels in Australia; 174,669 residential places; 46,475 community care places and 1,963 transition care places.

The report covers July 1, 2007 to June 30, 2008, including the final four months of the previous Government.

Section 63-2 of the Aged Care Act requires the Minister for Ageing to present a report on the operation of the Act for 2007-2008 before November 30.

Key facts: Report on the Operation of the Aged Care Act

Aged and Community Care – 2007-2008

• 208,079 people received permanent residential aged care;
• 39,443 people received short-term respite care in aged care homes; of whom 18,415 were later admitted to permanent care;
• 61,739 received care at home through a community care or flexible care package;
• 10,351 received transition care following a hospital stay;
• 53,074 admissions to residential respite care, and care recipients used an estimated 1.18 million resident days;
• A total of 10,874 new aged care places were allocated nationally during 2007-2008;
• About 831,500 individuals received a form of Home and Community Care (HACC) service – with some receiving more than one service; and
• A total of 188,967 Aged Care Assessments were completed in 2006-2007, compared with 179,354 for 2005-2006.

Aged and community care providers

• As of June 30, there were 2,830 nursing homes and hostels in Australia;
• In 2007-2008, the nursing home and hostel comprised – religious, charity and community based (59.7 per cent); for-profit/commercial (33.3 per cent) and State and local governments (7 per cent);
• In 2007-2008, the community care sector comprised – religious, charity and community based (83.6 per cent); State and local governments (11.7 per cent) and for-profit (4.7 per cent).

Expenditure – 2007-2008

• Overall Federal government expenditure for ageing and aged care during 2007-2008 totalled $8.3 billion compared with $7.7 billion in 2006-2007 – an increase of 7.8 per cent in 2006-2007;
• $6 billion was spent on residential aged care;
• $448 million for Community Care Packages – an increase of 10.6 per cent over 2006-2007;
• $335 million for flexible care programs, including Extended Aged Care at Home (EACH) and EACH – Dementia packages, Multi-purpose Services and Transition Care;
• Average accommodation bond charged to a new resident by providers was $188,798 in 2007-2008;
• the average holding per approved provider was $6.5 million and the 10 largest bond holders held about 19 per cent ($1.2 billion) of all accommodation bond monies; and
• Thirty-five per cent (6,098) of the 17,132 Resident Classification Scale reviews resulted in re-classifications – meaning the funding claims made by providers accurately matched the level of care for people living in nursing homes.

Expenditure – 2008-2009

• Over the next four years to 2011-2012, funding for aged and community care will reach record levels of $41.6 billion.
• Funding in 2008-2009 for community care services will total $2.2 billion – an increase of $260 million over 2007-2008;
• For 2008-2009 alone, there will be an increase of 10.4 per cent in funding for aged and community care;
• The new Aged Care Funding Instrument (ACFI) that commenced on March 20 with bipartisan support will see more than $1.13 billion in additional funding to the residential care sector over the first four years of its use;
• An increase in the Conditional Adjustment Payment (CAP) in the 2008 budget will see an increase of more than $407 million over the four years to 2011-12 flow to the sector – bringing the total CAP funding for aged care to $2 billion;
• Allocation of $150 million in Zero Real Interest Loans to create 1,455 nursing home beds and community care packages for older Australians in areas of high need – with 375 and 154 places in Western Australia and Tasmania, respectively; and
• Allocation of 228 new transition care places under its $293.2 million plan – to help older Australians recover from a hospital stay and return to their own homes. The 228 places are expected to benefit up to 1,710 older Australians – in a full year. Each funded place will be used by up to eight different older Australians a year.

Construction/upgrading work

• $1.45 billion worth of new building, refurbishment and upgrading work was completed to nursing homes during 2007-2008 – involving about 13.4 per cent of all homes;
• $1.93 billion of construction work was in progress as at June 30, 2008 – involving 9.8 per cent of all homes; and
• At June 2008, an estimated 11.6 per cent of nursing homes were planning building work.

Quality, complaints and compliance

• During 2007-08 the Aged Care Standards and Accreditation Agency conducted 5,244 visits to homes, with 3,105 visits being unannounced. In this same period the Department undertook 3,127 visits to homes, of which 1,145 were unannounced.
• The Accreditation Agency identified 46 homes (1.6 per cent) that had some non-compliance in relation to the 44 accreditation standard outcomes.
• The Aged Care Complaints Investigation Scheme (CIS) referred 1,770 matters to the Accreditation Agency, 62 to Nurses' Registration Boards, 53 to the police; 33 to the Coroner; 27 to the Health Care Complaints Commission and 13 to the Medical Practitioners Board.
• Twenty-two percent of the referrals to the Accreditation Agency requested a support contact or a review audit of a nursing home.
• During 2007-2008, the Department of Health and Ageing applied sanctions against 14 providers, issuing 15 Notices of Decision to Impose Sanctions and issued 75 Notices of Non-Compliance.
• The CIS received 11,323 contacts between July 1, 2007 and June 30, 2008 of which 66 per cent were able to be investigated as these related to approved providers' responsibilities under the Aged Care Act 1997 (the Act).
• The most common issues reported to the CIS in order were: Health and Personal care (3,106 cases), physical environment (1,598 cases), consultation and communication (1,496 cases), personnel (1,255 cases) and 1,117 cases relating to alleged abuse.

Breaches under the Aged Care Act

• The CIS identified 930 breaches of an approved provider's responsibility.
• There were 214 Notices of Required Action issued by the CIS requiring providers to address a breach.

Of the remaining number of breaches, the matters were resolved through a negotiated outcome or through referral to another agency.

Of the 930 breaches identified:

• 36 per cent (333) were in Victoria;
• 25 per cent (231) were in NSW;
• 17 per cent (162) were in Queensland;
• 9 per cent (84) were in WA;
• 6 per cent (53) were in SA;
• 4 per cent (39) were in Tasmania;
• 2 per cent (17) were in ACT; and
• 1 per cent (11) was in NT.

Notices of Required Action (NRAs)

214 Notice of Required Actions were issued where approved providers were found to be in breach of the Act and had not taken action to rectify the breach:

• 40 per cent (86) of all NRAs were in Queensland;
• 22 per cent (47) were in NSW;
• 15 per cent (32) were in South Australia;
• 9 per cent (20) were in Victoria;
• 4 per cent (8) were in both Western Australia and Tasmania;
• 3 per cent (7) were in the Northern Territory; and
• 3 per cent (6) were in the Australian Capital Territory.

Alleged Reportable Assaults

There were 925 notifications of alleged reportable assaults.

• Of those 725 were recorded as alleged unreasonable use of force and 200 were alleged unlawful sexual contact:
  
  NSW had 323 alleged reportable assaults,
  275 were alleged serious physical assault,
  48 were alleged sexual assault;
  
  Queensland had 225 alleged reportable assaults
  174 were alleged serious physical assault,
  51 were alleged sexual assault;
  
  Victoria had 224 alleged reportable assaults
  152 were alleged serious physical assault,
  72 were alleged sexual assault;
  
  SA had 86 alleged reportable assaults
  69 were alleged serious physical assault,
  17 were alleged sexual assault;
  
  WA had 33 alleged reportable assaults
  27 were alleged serious physical assault,
  6 were alleged sexual assault;
  
  Tasmania had 28 alleged reportable assaults
  23 were alleged serious physical assault,
  5 were alleged sexual assault;
  
  Australian Capital Territory had 5 alleged reportable assaults
  4 were alleged serious physical assault,
  1 was an alleged sexual assault; and
  
  Northern Territory had 1 reportable assault, which was an alleged serious physical assault.

Police are responsible for determining whether charges should be laid. As this is a police matter, within the jurisdiction of each State and Territory, the CIS is unable to track if and when charges are laid.

For more information, contact Mrs Elliot's office on (02) 6277 7280

The data: 1 July 2007 - 30 June 2008

Table 1: Aged-care homes that failed some non-compliance over period of 1 July 2007 - 30 June 2008
* = Sanctioned nursing homes; PFP = Private-for-profit; Govt. = Government; Sanc. Date = Sanction/s Date; NFP/R = Not for Profit: Religious; NFP/CH = Not for Profit: Charitable; NFP/CB = Not for Profit: Community Based

The information in this table is based on information that we have been able to access published on-line (at various intervals) by the Aged Care Standards and Accreditation Agency (ACSAA) and the Department of Health and Ageing (DHA). The current limited system of late release and early removal of adverse reports from the Aged Care Standards and Accreditation Agency website is unsatisfactory. Based on the limited information that is publicly available, the data may not be contemporaneous and these findings are tentative.

Lack of transparency: An unfulfilled promise

The government had promised greater transparency but there is little evidence of this in the aged care sector - particularly from a consumer perspective. If the Accreditation Agency and Government departments are doing their job then they should be collating the material and graphing it from a consumer's perspective. There must be far more involvement from communities and much more consumer input into these processes.

The current limited system of late release and early removal of adverse reports from the Aged Care Standards and Accreditation Agency website, and information provided by the Department of Health and Ageing, is unsatisfactory.

General comments

The current limited system of late release, and early removal of adverse reports, from the Aged Care Standards and Accreditation Agency website is unsatisfactory. Consumers are entitled to disclosure of past, as well as present, oversight (accreditation) reports. Recurrent offenders are of most concern. The Accreditation Agency should openly publish all reports (the old website accommodated historical reports prior to 2005 but has not since then). The community should be able to see what the company or provider is capable of when no one is watching - not just when they have been given time to prepare and not after they had responded to an adverse finding in order to stay in business.

One of the most remarkable and inexplicable things about the accreditation process is the total absence of any meaningful data from the nursing homes.

The agency does not expect the facility to disclose its incidence of pressure sores, contractures, weight loss and dehydration, complaints, incident reports, improvement logs, etc, nor do they verify the accuracy of data provided and report on it.

Consumers should examine the track record of the owner in his/her other homes. It is the owner who allocates funding and dictates policy. Consumers should visit the home unannounced and be given access, preferably during a meal time, to see the quality of food and whether there are staff helping residents to eat. A pervasive smell of urine or faeces is a warning. Facilities for physical exercise and mental stimulation are important.

Relatives are often unaware of the key relationship between bad nursing and the deteriorating condition of the elderly resident. Weight loss, dehydration, pressure sores, contractures, being bedridden, and mental deterioration may be accepted as due to ageing rather than to bad nursing, excess sedation, insufficient exercise and a lack of mental stimulation.

Insufficient and untrained staff is a key problem. Prospective residents and their families should obtain staffing information and have the knowledge to assess staffing ratios. This is the sort of information you require when you are evaluating a nursing home.

Glossary

• Accreditation: Accreditation is the evaluation process which aged care homes must undergo to continue receiving residential care subsidies from the Australian Government.
• Aged Care Standards and Accreditation Agency: (Changed name to the Australian Aged Care Quality Agency) is responsible for the accreditation of aged-care facilities, in line with the current federal government policy of self-regulation by industry.
• Accreditation Standards: Homes are assessed against four Accreditation Standards: Management Systems, Staffing and Organisational Development; Health and Personal Care; Resident Lifestyle and Physical Environment and Safe Systems. Each standard is divided into a number of Expected Outcomes. There are 44 Expected Outcomes across the four Accreditation Standards.
• Approved Provider: A person or organisation approved under Part 2.1 of the Aged Care Act to be a provider of care for the purpose of payment of subsidy (A provider approved since the commencement of the Act must be a corporation.)
• Sanction: A sanction (or multiple sanctions, depending upon the level of non-compliance/s) is a penalty imposed by the Department of Health and Ageing on operators of residential aged care facilities in cases of what they deem to be serious non-compliance with the provisions of the Aged Care Act 1997.
• Notices of Non-compliance (NNCs): Notices of Non-Compliance are issued by the Department when an approved provider has not complied with its responsibilities in providing required care and services but where this has not caused an immediate and severe risk to care recipients' health, safety or well being. The Notice issued to the provider makes clear what problems need to be addressed and by when. The provider is expected to meet with care recipients, tell them about the identified problems and explain what it will be doing to fix them.