Aged Care Crisis is concerned that there is no public disclosure when entities apply for approved provider status. Members of the community are neither encouraged, nor given the opportunity to object, to a particular provider or to supply information which might be extremely pertinent.

Giving those with knowledge, or with the time and interest to do research, the opportunity to provide additional information would minimise the risk that unsuitable providers might end up caring for frail and vulnerable people.

Approved provider status

The government has claimed that providers of aged care must be assessed to see that they are suitable before they are granted 'approved provider' status. It has recently become clear that this is not the case.

Dr. Wynne has highlighted the fact that once a group attains approved provider status, that status can be transferred to any unsuitable individual or company that buys the holder of approved provider status. No assessment is required. This status becomes a commodity which is clearly of considerable commercial value to a company whose suitability may be questionable.

Another example of this were the issues surrounding another proposed purchase of an Australian aged care company.

Probably very few of the private equity groups, banks and wealthy individuals who have taken control of our for profit nursing homes by acquisitions have had to gain approved status in their own right.

The department confirmed this in writing to Dr. Wynne on 20th February 2008 stating:

… As you are aware, an organisation which acquires a controlling or significant interest in an organisation that already has Approved Provider status is not required under the Aged Care Act 1997 to apply for Approved Provider status. BUPA, therefore was not required to seek approval from the Department of Health and Ageing…

Dr Wynne – Responding to DOHA

This is a glaring loophole in the regulations and places frail and vulnerable citizens at risk of exploitation by unscrupulous commercially focussed entities with little knowledge of the requirements of the frail aged or interest in anything other than the potential profitability of the sector.

Although some changes were made in December 2008, they have not properly addressed the issue as companies can still buy into the nursing home sector without having to seek approved provider status in their own right. In other words, the recent changes have been inadequate in dealing with the protection of frail and vulnerable citizens.

All shielded by "in confidence" provisions

Our correspondence has illustrated that an application for approved provider status is "in confidence". The communities involved, the residents, their families and concerned groups, are all excluded. People with relevant information do not know, and the community is locked out and so unable to protest or rock the boat.

Commercial interests are protected over the rights of the community, who will be the customers, and over the interests of the frail elderly trapped in a nursing home now controlled by an operator with a very different agenda.

The resident and their family may have chosen with great care, but all that effort was wasted. They might as well have pulled the name out of a hat.

"Choice" the new mantra

"Choice" is the new mantra from recent aged care reforms. The reforms seek to make aged care into a free and "competitive" market.

The report completely ignores the loophole in the approved provider process - and the lack of choice for residents, who are the profit bodies sold off for the new owner to exploit.

The system has betrayed the frail elderly and the productivity commission is complicit in this. It has conveniently ignored anything that might make aged care less of a free market.

FIRB does not vet most aged care transactions

The suggestion in corresponence from DOHA, that the Foreign Investment Review Board (FIRB) might vet the process, was explored.

The FIRB web site indicates that US companies have special privileges. Except for a few at risk sectors they are only required to seek FIRB's approval when making large investments in companies valued at over $1,005 million. For other companies the figure is $231 million. The sensitive health and aged care sectors are not listed among the exceptions.

Few Australian aged care companies would exceed this limit. Dr Wynne sent an email to FIRB in regard to Blackstone to confirm that this was the situation and asked what sort of protection there was for these sectors. He did not get a reply.


It can only be concluded that regulations do not protect the aged care system or the residents from the risks posed by dysfunctional multinational predators.

It is also clear that both political parties are so deeply in debt to the providers and their marketplace backers that they will not do anything about it.