Senate Community Affairs Legislation Committee, , 7:40:00 to 7:43:41
The committee discusses the specific indexation factors used to reach the 2.55% recommendation, including wages, superannuation, and CPI. IHACPA addresses the complexity of disaggregating non-care administration costs from provider data.
Topics: Health, Workplace relations
Speakers: Prof Michael Pervan, Senator The Hon Anne Ruston
I mean uh you say they understood but they're not happy about it. So it's one thing to understand the methodology that you apply to it. It's another one to agree that that is the right methodology. I mean, I'm sure if you walked me through it, I could probably understand how you reach the number that you reached, but that doesn't necessarily mean because I mean it it strikes me as this issue is far greater than not having margin built into the number. There are most people who've spoken to me are suggesting that they will actually have to take action because of the impact on their potential viability. And it also to a large degree goes in direct, sort of almost makes the minister's comments around the extra 5,000 beds that he thinks that the sector's going to go and build on the back of his his investment in the budget. Um the these changes are you know basically negate um all of the uplift that was proposed by that um has been negated by this. So just to that end, in the um you are you as you say you started off with the 2324 average costings. So what indexation factors so do you were apply, you I mean obviously you apply them to wages, superannuation, CPI, fair work, etc., etcetera, etcetera. So do you actually provide advice as to of the 2.55% ultimate uh increase that you're recommended, um how much is it attributed to each of those indexation factors? So is there a level of transparency about what are the factors that are having the largest or smallest amount of impact or contribution on changes?
Right. Thank you, Senator. Um it is very transparent to a point, but there becomes a point where um you you're dismantling the bike so that it's not writable anymore. So you know, um trying to disaggregate specific non-care related administration costs is actually very complex because that's not the way the data is recorded at the business end. So we've got to use the way the data is recorded to build the price. Um and you know, we've actually worked with aged care providers uh over the last couple of years on a particular issue around time spent um away from the residents as being you know not all active administrative time. Sometimes they're asleep. Um and uh we were in the first round probably over counting that time and worked with providers to correct it. Um the only way that we can learn and improve the price, and we're an organization that is very much dedicated on improving what we do on an annual basis is both to get that direct feedback at OHACPA, but also where there are serious viability issues to feed that through to the department so that they can raise it with us and we can look at what it is that is not being met. What specific element of funding is at workforce? Well, because of the way that we calculate the workforce costs, we're actually pretty confident about that. Is it admin, is it insurance, is it something else that we're not capturing or isn't in the the ACFR that we we need to take account of and as a last resort because I understand how busy providers are, do we need to ask for additional data from them? And we kind of that's as I said, it's a last resort because we know that many of them struggled to maintain their um existing data commitments.