Cth Bill to Introduce Second Stage of Royal Commission Aged Care Reforms

On 1 September 2021, the Aged Care and Other Legislation Amendment (Royal Commission Response No. 2) Bill 2021 (Cth) (‘the Bill’) was introduced to the House of Representatives by Minister for Health and Aged Care Greg Hunt ('the Minister').

The Bill intends to implement a number of recommendations made by the Royal Commission into Aged Care Quality and Safety ('the Royal Commission'). The Bill seeks to amend the Aged Care Act 1997 (Cth) (‘Aged Care Act’), the Aged Care Quality and Safety Commission Act 2018 (Cth) ('Quality and Safety Commission Act') and other aged care related legislation.

The Bill proposes a wide range of amendments relating to:

• aged care funding;
• pre-employment screening;
• a code of conduct and banning orders;
• incident management and reporting;
• governance of approved providers;
• information sharing; 
• financial oversight; and
• the Independent Health and Aged Care Pricing Authority.

The Minister stated in his second reading speech:

The first stage of reform was implemented by the Aged Care and Other Legislation Amendment (Royal Commission Response No. 1) Act 2021 (Cth) which received royal assent on 28 June 2021, and commenced shortly after.

Aged Care Funding

Schedule 1 of the Bill contains proposed amendments that seek to replace the current residential aged care basic subsidy calculation model (known as the Aged Care Funding Instrument) with the Australian National Aged Care Classification (AN-ACC) model.

The Bill's Explanatory Memorandum further explains:

Pre-Employment Screening

Schedule 2 of the Bill proposes to replace existing police check requirements for screening aged care workers with a new obligation on providers to comply with the requirements of the Accountability Principles 2014 (Cth).  Under the proposed amendments, approved corporate providers will incur a civil penalty if this obligation is breached.

Further, the Bill proposes to include the establishment and operation of the Aged Care Screening Database (‘the Database’) to the Aged Care Quality and Safety Commissioner’s ('the Commissioner') responsibilities and functions. The Bill also seeks to allow the Commissioner to grant access to the Database for approved providers for the purposes of fulfilling their screening obligations. 

Code of Conduct and Banning Orders

Schedule 3 of the Bill seeks to provide the Commissioner with powers to establish and enforce a Code of Conduct (‘the Code’) for approved providers and their workers. The proposed changes would allow the Commissioner to be informed of alleged breaches of the Code and take action against substantiated breaches.

In particular, the Bill proposes a new enforcement action in the form of banning orders which would effectively restrict or prohibit aged care workers and governing persons who are unsuitable from working or otherwise being involved in the aged care sector.

Incident Management and Reporting

Schedule 4 of the Bill seeks to extend the Serious Incident Response Scheme to home care and flexible care delivered in a home or community care. Effectively, this would mean that providers of home care or flexible care would be required to:

• implement and maintain an incident management system adhering to the requirements under the Quality of Care Principles 2014; and
• notify the Commissioner of reportable incidents that occur in home or community settings.

Governance of Approved Providers

Schedule 5 of the Bill proposes a wide range of amendments to improve the governance of approved aged care providers including:

• introducing new governance responsibilities for approved providers in relation to the membership of their government bodies and the establishment of new advisory bodies;
• establishing measures to improve leadership and culture;
• introducing new reporting responsibilities, including an obligation to provide an annual publicly available statement on their operations;
• requiring approved providers to notify the Commission of changes to key personnel; and
• introducing a suitability test for key personnel.

Information Sharing

According to the Bill's Explanatory Memorandum, Schedule 6 of the Bill proposes to amend the various legislation for the purposes of facilitating:

Financial Oversight

Schedule 7 contains amendments that intends to introduce a new framework for financial oversight for the aged care sector. According to the Minister's second reading speech, these amendments will:

The Minister also continued to explain that the Bill proposes to implement stage two of a three-phase reform plan by:

Independent Health and Aged Care Pricing Authority

Finally, Schedule 8 of the Bill intends to  to expand the functions of the renamed Independent Health and Aged Care Pricing Authority ('IHACPA'). The Minister explains in his second reading speech that this expansion would:

The rationale of transferring these functions to the IHACPA, which are currently performed by the Aged Care Pricing Commissioner is to “streamline administration and enhance industry confidence”.

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Aged Care and Other Legislation Amendment (Royal Commission Response No. 2) Bill 2021 (Cth) and explanatory materials available on TimeBase's LawOne Service