Opinion: A proposal for a new governance approach to aged care

By Stephen Duckett

November 30, 2020

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The current governance system for aged care in Australia is overly centralised; has failed to ensure adequate accountability or set a culture that empowers older Australians; and failed to prevent the abuse and neglect of older Australians in the aged care system.

The Grattan Institute, in a report released today, proposes a new governance approach involving a clear role for the Health department and a new Australian aged care commission, augmented by a network of ‘regional system managers’ that would take over some of the functions of the existing Aged Care Quality and Safety Commission.

A national system steward

We propose that the new commission, or `national system steward’, should have responsibility for overall system functioning and oversee regional system managers. The key responsibilities of the national system steward should be to:

  • Manage overall system functioning according to the principles and rules under the Aged Care Act, including setting and/or varying quality standards and setting the rules for new entrants;
  • Monitor compliance with national standards through the work of regional system managers, and publish comparative performance data;
  • Oversee regional system managers, including their regulation of provider performance, pricing of regional system services, and ensuring the effectiveness of service system management;
  • Provide a second line of defence for accountability and enforcement; and
  • Be responsible for workforce planning, including setting of minimum workforce standards and training requirements under a new workforce register.

The national system steward should be an independent statutory agency, with a governing board directly responsible to the relevant minister. The governing board should be skills-based and include a person with lived experience of aged care and support. The current Aged Care Financing Authority and the Aged Care Quality and Safety Commission should be incorporated into this new overarching governing agency. This should coincide with a shift in the culture, capability, and competency of the current national bodies.

The Health department should continue to have a role in providing policy advice to government and the national system steward. It should also oversee the whole system and ensure aged care policy is more integrated with disability and health care policy. The role of the department would be more limited than now, because many operational functions would be devolved to regional system managers.

An independent and competent Australian Aged Care Commission would help restore community confidence in the aged care system. The department does not have a good record of ensuring good governance or accountability. As well as providing a much more prominent point of accountability and stewardship for the aged care system, the commission should be a trusted, non-partisan voice for older people who need aged care services.

We deliberately use the term `steward’ to define the national body’s role in setting the regulatory framework for the system, ensuring compliance, establishing the roles and functions of different actors, and adjusting the system in response to monitoring and feedback.

Stewardship is an explicitly ethically based, outcome-oriented policy approach, with a role designed to prevent market failure and manage markets for social purposes. For vulnerable populations, stewardship ensures the rights of individuals are protected. As with market models, individual agency and choice remain central, but stewardship manages markets to ensure they are more fully realised. Stewardship takes account of the need for the system to achieve broader social goals, such as equity of access, quality of provision, and efficient service delivery.

Regional system managers

Even with state offices, the existing Canberra-focused aged care system is too remote to hold providers to account. Under the Grattan model, regional system managers would provide a much-needed personal touch. They would look providers in the eye and make them directly accountable for their recommendations about care.

Regional system managers would coordinate and negotiate access to services for older Australians. They would monitor the system in their region, overseeing providers and commissioning new services where there is a gap in the market. They would help coordinate and integrate non-aged care services, including health care.

This more decentralised governance structure should help uphold the rights of older Australians. National rights-based quality standards would be set and enforced, with additional focus on ensuring providers deliver services according to people’s individual support plans.

The Grattan governance model for aged care would split responsibilities to ensure checks and balances are in place. The national system steward would set the framework, and the regional system managers would operate the system.

The regional system managers should be independent from government and providers. This would promote transparency, accountability, and efficiency in the delivery of aged care services, and enhance community trust. Independence will ensure regional system managers can appropriately advocate for and support the rights of older Australians in their region.

That, surely, is a goal to which all Australians can aspire.

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