A new era in aged care funding

The introduction of a new funding mechanism is a significant event for both aged care providers and the Department of Health. It brings widespread changes to technology, workforce, process, and documentation. The Australian National Aged Care Classification (AN-ACC) will replace the Aged Care Funding Instrument (ACFI) on 1 October 2022.

The AN-ACC CEO survey draws together the sentiments and readiness of aged care leaders towards the implementation of AN-ACC. The survey finds that there is a low level of preparedness for AN-ACC, concern from CEOs about the budgetary impacts, and little confidence that technology systems can meet the required deadline.

Key findings

  • AN-ACC ranks in the top 3 priorities for CEOs but behind COVID-19 and Workforce
  • 75% of respondents are confident in their ability to maintain focus on ACFI (current funding) despite the requirement for transition and pressure on existing resources
  • 70% consider themselves to have done little or nothing to prepare for AN-ACC given other priorities and perceived lack of information available to prepare
  • Systems are believed to pose the biggest transformation challenge with participants ranking it well above finance, people, data and process.

The aged care industry has faced enormous challenges in recent years. The COVID-19 pandemic affected operations, workforce, and financial performance. It is no surprise that providers are struggling to find the resources or time to prepare for AN-ACC.

Most of the providers we speak to have not had the time to understand the detail that is available for AN-ACC, let alone to begin planning in any detail for the impacts on their business operations.

The five areas of business that will be impacted by AN-ACC

We framed our survey around a transition model that we developed to support all providers to structure their approach to the required changes. The Mirus ACFI to AN-ACC Pathway centres around the five workstreams of finance, people, process, systems and data.

Here’s what CEOs told us

  • Finance – Significant concern that funding will not be maintained
  • People – High confidence in people but new skills and significant training required
  • Process – Little or no progress on planning for new AN-ACC processes
  • Systems – Low confidence that technology will be ready for the AN-ACC changeover
  • Data – Opportunities and challenges in new data models have not been fully considered

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What we’re hearing

“Not a priority because we need to focus on things we can control”
“Liaison with government will be a new skillset for funding managers”
“Processes are the hardest thing to change in Aged Care”
“Most providers don’t have the luxury of going into a revenue slump”
“Clinicians are hard to change, that may take a while”
“We make decisions based on data. Until I have the data in front of me, I will remain concerned”
“AN-ACC links to everything else. If you don’t get it right it will have wide impacts”
“We are watching with intent and [and] not confident in the revenue side of the equation”
“I would love if ANACC would cover the true ‘cost of care’”

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About the survey

After having scores of conversations with providers around the AN-ACC changes over the last six months, we decided to embark on this AN-ACC CEO survey to formalise some of the views. The CEOs we surveyed represent a cross-section of the industry: big and small, for profit and mission-based and across geographies, east, west, metropolitan and regional. Those interviewed represent approximately 22,000 beds or 10% of the industry.