A New Age in Aged Care: Managing Aged Care Costs



Our Aged Care Sector has received an incredible amount of media attention over the last 18 months. There have been many reasons for this, including reform on aged care costs. The first was the devastating Coronavirus (Covid-19) pandemic which swept through our residential aged-care facilities in March 2020. This unexpected virus caused serious illness and over 685 deaths in our elderly communities.

Then, if that wasn’t bad enough, the Royal Commission was lodged into Aged Care Quality and Safety*. They released their final report from the 2018 enquiry into the quality of aged care in Australia.

The commission said that the “Aged care system fails to meet the needs of its older, vulnerable citizens. It does not deliver uniformly safe and quality care, is unkind and uncaring towards older people, and, in too many instances, it neglects them.”

Aged Care Costs

It didn’t take too much to convince the Australian public of the failure of the aged care system. These failures made it to the news on television almost nightly and were covered extensively on other media channels. As the effects of the pandemic on our older Australians began to emerge, revelations began to surface of the abuse and mistreatment of some of our most vulnerable elderly citizens.

Who can forget the images taken from within aged care facilities of residents whose sanitation had been neglected for days? We even saw footage of nursing staff physically abusing residents in their own rooms.

Of course, there were many facilities still taking wonderful care of their elderly residents as usual. We commend these providers.

A Royal Commission

The discovery that some of our residential aged care facilities and home care providers were treating our most vulnerable citizens in unacceptable ways compelled the Honourable Tony Pagone QC (Chair of the Royal Commission) and Ms Lynelle Briggs to take a deep dive into the reasons why our Aged Care system had deteriorated to the point of crisis and go completely unnoticed.

Over the last three years, the Royal Commission waded through more than 10,500 submissions. Six hundred witnesses were called to confirm the deterioration of the aged care system.

In February 2021, the “Final Report Care Dignity Respect” was released by the Royal Commission and tabled in parliament. The paper was designed to usher in a “New Aged in Aged Care”. The focus of this shifted to the individual needs and preferences of the elderly in aged care.

The report called for a new system underpinned by a rights-based Act. This has aged care funding based on need, in conjunction with stronger regulation and transparency of the system. This was the beginning of a major overhaul of our Aged Care system, which was long overdue.

Around the same time the Royal Commission’s recommendations were announced, in May 2021, the Federal Government’s response came via the Federal Budget. A massive funding budget of $17.7 was announced for aged care with a five-year, “five-pillar plan.” The plan detailed how the funding billions would be spent.

This addressed 126 of the 148 commission’s recommendations which were accepted. All but six of them were subject to further consideration.

$17.7 billion was to be spent over the next four years to address the 126 recommendations.

While the record funding was welcomed, some industry players say it is cash being thrown around. This will only bolster the current system rather than genuine, structural aged-care reform.


  • $6.5 billion will be spent funding an additional 80,000 home care packages over the next two years. There are well-needed and will assist loved ones to stay independent longer.
  • $798 million will be spent on funding support to 1.6 million informal carers. This will enable carers to access and equip them with the services and support they need. There will be more targeted support for carers looking after people with dementia.
  • $3.9 billion will go towards increasing the amount of care received by residents of aged care homes. The mandate means that each resident will receive 200 minutes of direct care per day. This includes 40 minutes with a registered nurse.
  • $102 million has been assigned to residential aged care places directly to senior Australians instead of residential aged care homes.
  • $200 million for a star rating system. This will better inform seniors and their families about the quality of care provided by residential aged care places.
  • $652 million investment will be made into the aged care workforce. This will increase the number of personal care workers and the number of training places for them.
  • $698 million is being provided towards the governance of the aged care industry. This is to ensure improved care outcomes and a new values-based Aged Care Act.

When will it happen?

By 2024, the aim is to have a new Aged Care Act in place to replace the untouched 1997 act. It may have taken us 24 years to arrive at this point, but the good news for carers and their elderly loved ones is that Aged Care repair is on the way.

For primary carers, this means: An increase in support for informal and family carers, especially for those caring for people living with dementia. The aim is to reduce carer stress and improve carer well-being by funding more flexible and centre-based respite places. Funding will also be given directly to support the people living with dementia. This will help them to remain at home and provide more help with the management of treatment and care and medication management.

Carers will benefit from increased support. There will also be education to improve the quality of life for both the person they are caring for and for themselves. The budget will also be funding early access to Carer’s Gateway. This will help carers get support through counselling, coaching, peer support and skills training.

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In Need of Support?

Carer Gateway is an Australian Government program providing free services and support for carers. Call Carer Gateway for support and access to services, Monday to Friday, 8am to 5pm local time.

Assistance with accessing emergency respite is available any time, 24/7.

1800 422 737 

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