Renewed calls for aged care watchdog

At our latest Aged Care Sector Update, Arie Dekker of First NZ Capital reflected on sector trends from an investment and economic perspective, as well as in the construction space.  The trade union calls for a ‘living wage’, and movement on the pay equity front with the Equal Pay Amendment Bill having its first reading in Parliament today were also debated.

There's a feeling of change in the air with a call from the Associate Health Minister to the Ministry of Health for advice on options for possible reforms in the aged care sector, including establishing an Aged Care Commission to provide greater scrutiny.  This follows recent pressure from Grey Power for the Labour and Green parties to honour a pre-election pledge.

What we know

In 2017, Labour, the Green Party and Grey Power undertook an inquiry into the aged care sector (Inquiry) following on from their earlier comprehensive inquiry in 2010.  The focus of the Inquiry was to investigate the standard of care of our elderly, and whether the issues identified in 2010 were still present.  The Inquiry’s recommendations (published last year) were said to represent the “direction of travel both political parties agree to pursuing in aged care”.

One key recommendation was to establish an Aged Care Commissioner:  a ‘one stop shop’ for complaints, and a champion of the rights of those in the sector.  Proposed responsibilities of the Commissioner include working with stakeholders to improve outcome-oriented performance measures and investigating the need for a Government-backed star rating system.

What we already have

Due to the vulnerability of those in aged care, the sector is already heavily regulated.  The Ministry of Health, the Ministry of Social Development, local district health boards (DHB), and the Health and Disability Commissioner (HDC) all have fingers in the aged care pie.  Of note, the HDC administers a complaint process and conducts initial investigations, which may then be escalated to the relevant DHB or the Ministry of Health.

What others are doing

Australia

Due to a spike in elderly abuse, and in preparation for the prediction that the population in aged care will double by 2055, our closest neighbour has announced it will be introducing an independent Aged Care Quality and Safety Commission from 1 January 2019.  Like New Zealand, Australia already has multiple government agencies with aged care responsibilities, including an Aged Care Complaints Commissioner, which administers a complaints service.  The new Commission will bring together all existing functions into a single point of contact and will be accompanied by an increase in funding by AU$5 billion over the next five years.

Australia has also recently commenced a Royal Commission into the aged care sector which is likely to result in significant legislative and policy reform in Australia (with the interim report due October 2019 and final report due April 2020).  We are keeping a watching brief on that inquiry to identify any potential impact or flow on it may have to the New Zealand aged care sector.

United Kingdom

The United Kingdom similarly has an independent regulator of all health and social care services.  The Care Quality Commission monitors, inspects and regulates aged care service providers in the United Kingdom and administers and publishes performance ratings.

What now

Renewed focus on an independent Aged Care Commission in New Zealand was likely triggered by similar changes getting the green-light across the ditch.  Australia’s changes were driven by a view that its existing framework is fragmented and a single regulator will coordinate efforts, enhance access to information, and ultimately improve the delivery of quality aged care.  This is in line with the 2017 recommendations of the Inquiry.  In particular, the view that the HDC’s responsibilities are too broad to adequately focus on the needs of the growing population in aged care and a single point of contact would better champion the rights of our most vulnerable.

While the Inquiry’s recommendations are not inconsistent with Australia and the United Kingdom, the significance of such changes on the prevalence of elder abuse remains unclear.  Contrast this to Australia, where systemic issues have been identified, triggering a Royal Commission of Inquiry into the sector (noting that since 2009 there have been 10 federal inquiries by the Australian Senate and others into aged care).

However, some within the industry hold the view that the appointment of an Aged Care Commission is out of proportion with the sector size in NZ (approximately 38,000 residents), and that a Minister for Aged Care could be a more proportionate response.  Given that the Inquiry merely informs the “direction” of Labour and the Green’s aged care policy, it’s a waiting game to see whether central Government has the appetite for an independent Aged Care Commission.

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