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EXPOSED: The Aged Care Industry has fallen short

The joy for the aged care industry from the government’s commitment to more funding has been short lived – amid reports it simply isn’t ready for change.

The Government has allocated $1.6 Billion to increase in home care place by 14,000 over 4 years, resulting in our aging population staying at home longer with more support to do so.

Anna Porter agrees that “This is a win for our aging population and a much-needed measure, but it certainly won’t encourage our aging population to sell their oversized family homes thus freeing up housing stock, not easing pressure on the housing market.”

But according to Aged Care Coordinator, Angela Jones of Aged Care Ready, this government commitment has really fallen short and the aging population are suffering as a result.

“Once you are assessed as eligible to receive a Home Care Package, there can be long wait times for this funding to be distributed. In many cases we are seeing 12-18 months wait times for a Level 4 package, meaning, until this funding comes through, pensioners are required to fund their own care,” says Angela Jones.

“It’s clear that those eligible need help with day-to-day practices like showering and dressing, grocery shopping, home cleaning and mealsand whilst the government has acknowledged this, they really are not performing up to scratch. The measures are in place but in reality, it is one big failure with the pensioners being hit the hardest,” Jones continues.

“With the large number of people needing to access the system, there isn’t enough money in the funding pool to assist everyone – especially, when they need it the most. Most people don’t ask for help until they actually need it, and to have to wait even longer can be really challenging,” says Ms Jones.

This government push for in-home care has relieved some of the pressure on the aged care facilities across the country but has done nothing to lower their costs – forcing many to rely on emptying their pockets to fund their care or going without.

“From 5 star resorts, all the way down to budget accommodation. The aged care sector has a variety of options on offer throughout the country,” Anna Porter says “But the Government has put its sights firmly on aging in home, as opposed to transitioning to a facility due to the high costs of developing and running these facilities and the compliance nightmare that brings with it. Some of the statistics are just plain alarming. A recent report released by Stuart Brown Accountants on the sector revealed that just over 20% of facilities are running at a loss based on their EBITDA as at September 2017, for care and accommodation, and of those 56% are located outside of major cities,”

“Furthermore, when looking at the in-home care space the funding is just not coming through quick enough to match the needs of the sector. A recent report from the Australian Department of Health showed that whilst 74,205 in home care packages are being utilised as at September 2017, there is an astounding 60,615 on waiting lists for funding packages. There is nearly more on waiting lists as there are active packages in the country. Meaning that the Government support is falling well short of needs and will soon hit critical mass. This is pushing more people into facilities as they can-not fund the gap from their pension and the care needs they have are considered essential.” says Porter.

Given more people have to turn to facilities over aging in home due to funding gaps, the question remains, do you really get better care in these high-end facilities or is the care just the same? According to the Stuart Brown reports the average RAD (refundable accommodation deposit – commonly known as a bond) is $323,849 across the country, but in Sydney for example this ‘average’ price point is nowhere to be seen. Sydney also accounts for the greatest price differential, at a $1,871,332 price difference between the most exclusive facility to the most affordable, you would want to be assured that you are getting better care. Plus, in more expensive facilities you can expect a much higher daily fee for additional services.


“Not surprisingly, Sydney is host to some of Australia’s most expensive aged care facilities. There are the likes of The Mark Moran facility at Vaucluse, where the refundable accommodation deposit (known commonly as a bond) for a single room with an en suite will set you back $2,000,000. This award-winning facility includes services such as fine dining under the guide of head chef Perry Hill, a day spa, health and wellness programs and the type of facilities you would expect at a 5-star resort,” says Ms Porter.

“The Moran facility was only slightly more affordable than the prestige, and most expensive facility available at Beresford Hall, Rose Bay where the upfront fees sets you back $2,067,332 plus the additional services fee that is above the ‘normal’ care fees of $104 per day, as mandatory. For those that don’t have the spare $2million to buy in, you can pay a fee known as a DAP, which is not too dissimilar to daily rent. This will set you back as much as $322 per day, plus the extra service fee of $104 per day. That is a staggering $2,990 per week to live there,” explains Anna.

“That is more than privately renting a prestige 2 or 3-bedroom unit in the area with views of the water to the harbour bridge. This style of private rental accommodation is typically priced around $1,500-$2,500 per week. Admittedly, you don’t get 24-hour care in a private unit so that is one of the things you are paying for in these aged care facilities. But, you also get 24-hour care in the more affordable facilities throughout Sydney, some are priced as little as $36 per day for the same DAP fee. So, what makes up the other $390 per day for the elite end of the aged care spectrum? In the upper end facilities, you get access to the 6 star services like concierge, day spa, indoor pool, gym, therapy facilities, restaurants and many more hotel style facilities and of course… location!”


“But is the care any better? From a healthcare aspect, the answer is plain and simply no, according to our Aged Care Ready division. We asked Angela to delve into the national database of accreditation reports on all of the facilities that make up the upper end of the market and the most affordable to see if they meet all of their standards of care. We were half expecting the more expensive ones to have failed a few of the criteria and the most elite ones to pass with flying colours,” states Anna.

“We presumed that facilities with lower price points would have a bigger stretch on their resources, resulting in lower scores on these government reports. But, it was certainly not the case. Every facility we looked into met all 44 of their accreditation criteria. So, this goes to show that you certainly aren’t paying any extra for the level of care as that was consistent across the most expensive and the most affordable residential care homes,” Anna explains.


“At the other end of the spectrum, we looked into locations that have the highest rate of disadvantage or fall within the metro areas that are classified as the lowest socioeconomic postcodes: areas around Miller, and Mount Druitt, Shalvey and Lethbridge Park, where welfare dollars outstrip income tax paid by residents. In these areas, aged care facilities need to provide an affordable entry point and also offer 25% of the accommodation under a ‘low means’ capacity. ‘Low means’ candidates access a zero cost of entry; the resident has to be assessed as eligible and the waiting lists can be lengthy. For those who are not eligible for free aged care accommodation, the cheaper options include Pembroke Lodge in Minto and Ruby Manor in Carramar opting for shared rooms with shared en suite you can buy in for only $196,000, which is fully refundable on exit. Whilst St Basils, Lakemba offers a single room with en suite for just $200,000, also fully refundable on exit. These make up some of Sydney’s most affordable aged care facilities available,” Anna explains.