Presented by Lorraine Poulos For Aged and Community Services Victoria Organisational Financial...
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Presented by Lorraine Poulos For Aged and Community Services Victoria Organisational Financial Implications of Consumer Directed Care in Home Care Packages
Presented by Lorraine Poulos For Aged and Community Services
Victoria Organisational Financial Implications of Consumer Directed
Care in Home Care Packages Lorraine Poulos and Associates 1
Slide 2
Thank you Acknowledgement of traditional owners Background to
presentation 2 Lorraine Poulos and Associates
Slide 3
Disclaimer LPA take no responsibility for business decisions
based on todays presentation All providers are encouraged to seek
legal and financial advice about any major financial decisions that
may be need to be taken following this presentation Your peak body
in your state is the most valuable advocate or source for any
questions or concerns relating to CDC and community care matters 3
Lorraine Poulos and Associates
Slide 4
This presentation Lorraine Poulos and Associates 4 Look at
possible financial implications Consider what other providers are
doing Challenges Opportunities The importance of recognising the
implications if CDC is introduced into all of aged care Most
significant change in community aged care in history of care
provision
Slide 5
Brief History Aged Care- Community Care 2002 Review of
community programs nationally 2004- The Way Forward- a consultation
for improving Community Care 2006- Decision by COAG to streamline
systems and services 2007- Commonwealth agrees to manage aged care
from 2012 2010- Consumer Directed Care pilots began 2011- new
Community Care Common Standards (Home Care Standards)and
accountability system 2011 Productivity Commission into aged care
2012- All HACC and other community aged care programs report to and
managed by DoHA DSS 2013- (WA and Victoria delayed transition)
2013- Living Longer Living Better Aged Care Reforms 2013- CDC for
new packaged care consumers 2014- Australian Quality Aged Care
Agency 2014- Income testing for home care consumers 2015 all
packaged care to be CDC 2015-New HSP and CSC, My Aged Care Website
etc. 2015- National Fees Policy for all community services 5
Lorraine Poulos and Associates
Slide 6
Background to CDC in Australia HACC services included case
management services Original CACPs in mid 1990s were to be a
combination of case management and at least 2 other home care
(HACC) services e.g. personal care, domestic assistance etc.
Packaged care was always intended to be an individualised model of
care and not Block funded ( provider paid a sum of money to provide
a number of outputs or services) Overseas models in UK, USA and NZ
identified benefits to consumers as their care needs change if they
have more involvement and access to unspent funds Lorraine Poulos
and Associates 6
Slide 7
Background Lorraine Poulos and Associates 7 Some providers have
always operated CACPs or HCP as individualised budgets This has led
to confusion with consumers, ACATs, other providers Inconsistencies
in service delivery Providers have been able to use unspent funds
at the end of the financial year to support other infrastructure or
higher levels of service
Slide 8
Brief overview of CDC 1000 were in operation across Australia
2010-12 Pilot learnings: Choice, control and flexibility Un-bundle
Case Management from care Consumers manage with right tools,
support and environment Consumers not always spending allocations
KPMG report Department of Social Services website (remember this is
the Pilot report) Lorraine Poulos and Associates 8
Slide 9
Financial implications of CDC Consumers are assessed and have
the power of choice- Consumer Directed Care- but providers will
hold the fundsnot be funded Margins or profits have reduced or are
unable to be planned for unless it is included in administration
levy, unit cost for core advisory and direct care work provided by
your own organisation Returns on Investments may have to be
adjusted Requires a commitment to technology and assistive devices
9 Lorraine Poulos and Associates
Slide 10
Financial implications of CDC Lorraine Poulos and Associates 10
Expectation that consumers will contribute to their care AP will
have to collect fee from consumers based on Centrelink assessment
Finance department now spending more time on the day to day
processes in Home Care Policies need to be clear about agreements,
non payment of fees, equipment purchases, using other providers,
cash transactions, negotiations with admin charges etc.
Slide 11
Biggest Change An organisation will have to be transparent to
the consumer what it is they are paying for in the area of
administration, case management or co-ordination and the unit costs
of care and services Lorraine Poulos and Associates 11
Slide 12
New Home Care Package subsidies Home Care Level 1 a new package
to support people with basic care needs- around $7,500 pa Home Care
Level 2 equivalent to the existing CACP- around $13,600 pa Home
Care Level 3 a new package to support people with intermediate care
needs- around $30,000 pa Home Care Level 4 equivalent to the
existing EACH package around $45,500 pa 10 Lorraine Poulos and
Associates
Slide 13
Individualised Budget 13 1. Monthly statement 2. Format must be
able to be understood by consumer 3. Must have income and
expenditure line items 4. Time period agreed for review 5. Provider
must keep a budget for each client regardless of the consumers
desire or capacity to be involved in their budget 6. Must provide a
monthly statement to consumer or Person Responsible Lorraine Poulos
and Associates
Slide 14
Income components 14 1. Income must identify the total funds
available including: Full subsidy amount All supplements e.g.
Dementia, DVA, Oxygen, Homelessness Consumer contribution Lorraine
Poulos and Associates
Slide 15
Expenditure 15 Grouped into 3 categories: Administration costs-
(rostering included) Core advisory and care management services
Service and support provision and/or purchasing Lorraine Poulos and
Associates
Slide 16
Contingency fund 16 Budget may include a small contingency fund
for emergencies, unplanned services. This must be no more than 10%
of the total budget Must be clearly identified in the budget and
regular statement Lorraine Poulos and Associates
Slide 17
Unspent funds 17 Change of package from 1-2 band to 3-4 band-
funds move with the consumer Moving provider- unspent funds can be
retained by the provider Excess leave there is discretion for
provider to make the funds available for consumer later Subsidy
reduces to 25% if leave is exceeded and package to be protected
There is discretion for provider to agree to transfer unspent funds
to another provider Unspent funds on cessation remain with
provider-(no real data on what this amount may be or what may
happen if DSS reduces annual subsidy) Lorraine Poulos and
Associates
Slide 18
Income testing implications Current funding (Grandfathered
whilst consumer remains on program) Contribution fee 17.5% pension
( approximately $9.70 day)-NOT ALWAYS CHARGED PLUS DSS payment per
day depending on Level 1,2,3,4 This is regardless of whether they
are Part Pensioners or Self Funded Retirees Lorraine Poulos and
Associates 18
Slide 19
Pensioner Contribution fee 17.5% pension ( approximately
$9.70day) PLUS Funding paid DSS depending on Level of HCP Expected
that provider will charge the $17.5% contribution fee and consumers
will have to complete a financial hardship form if they cannot
afford to pay- (Many providers reducing the fee due to occupancy
issues) Lorraine Poulos and Associates 19
Slide 20
Part Pensioner Contribution fee 17.5% pension ( approximately
$9.70 day) PLUS Income tested fee up to $5000 for part pensioner (
approximately 13.69 per day $95 per week) PLUS Difference paid by
DSS depending on Level of HCP Lorraine Poulos and Associates
20
Slide 21
New Income splits post July 2014 for NEW consumers SFR
Contribution fee 17.5% pension ( approximately $9.70 day) PLUS
Income tested fee up to $10,000 per year ( approximately 27.39 per
day or $191.17 per week) PLUS Difference paid by DSS depending on
Level of HCP Lorraine Poulos and Associates 21
Slide 22
Basic Accounting Terms & Concepts staff at service level
need to understand Accrual Accounting vs Cash Accounting (very
important once income testing commences) Individualised Budget-
what is it ? Who will do it with consumer? Unit Cost- do we know
what it is? What about if consumers do not use our service?
Contingency Fund- how much will DSS allow it to be? Budget / Income
& Expenditure- this needs to be monitored regularly 22 Lorraine
Poulos and Associates
Slide 23
Checking your overheads Lorraine Poulos and Associates 23
Administration costs reflect establishment costs for the
organisation and would also include the costs of meeting government
quality and accountability requirements. Administrative costs
include: insurance and government reporting corporate overheads
capital costs ongoing research and service improvement CDC
administrative overheads including staff and IT developing
statements and other consumer communication establishing contracts
with sub-contracted providers setting up and cancelling appointment
( i.e. rostering) Page 37 HCP guidelines)
Slide 24
Lorraine Poulos and Associates 24
Slide 25
Feedback continued: Lorraine Poulos and Associates 25 No
guidance on acceptable administration fee from DSS or level of
unspent funds that can be retained each year and rolled over e.g.
Level 4 may have a high retention of funds Transition issues (from
non CDC to CDC) when providers are trying to charge a daily fee
when they may have been asking for an hourly contribution (e.g $5
per hour ) or not been collecting fees at all! Accounts departments
not understanding the changes and the impact on occupancy and
budgets Only allowed to charge one month fees in advance (DSS
recent briefings) Level 1 and 2 packages very hard to fill given
the daily fee requirement Concern potential clients/consumers will
say NO when fees are required Feedback about consumers who are now
questioning what has been done with their allocated fees in the
past i.e. 1-2 hours and no case management
Slide 26
Check list for providers Lorraine Poulos and Associates 26
Check your past occupancy and average hours etc. to establish some
budget assumptions Client agreement gain legal advice and ensure
all requirements as per the Home Care Package guidelines are
included Do you have a brokerage template? Have your staff received
training in CDC and person centred care? What is your risk
management processes and are they robust enough for consumers to be
able to make choices that do not impact on your duty of care whilst
recognising their right to choice in CDC ? What changes need to be
made to your care plans to reflect the value and role of your case
management?
Slide 27
Lorraine Poulos and Associates 27 Accounting and budget
software- ensure the system used meets the needs of the program
i.e. monthly budget roll over and itemised hours etc. as per
guidelines Have you separated your coordination (rostering) and
case management costs to establish what your unit cost may be for
the case management component of your services in line with Home
Care package guidelines? (this may be called support and advisory
services)? Gain some advice and assistance with establishing your
unit costs
Slide 28
Lorraine Poulos and Associates 28 What is your administration
fee ? Will it differ for each level of package? Will it be a flat
fee or a % of the income? Decide what your business rules will be
e.g. are kilometres included in your unit cost for care workers?
Who pays for equipment maintenance? What other providers will you
be working with and what are your requirements when entering into
an agreement with them? What is the protocol for staff to make
purchases or consumers who wish to manage their own package? What
if a client wants to bargain for a cheaper levy ?
Slide 29
Lorraine Poulos and Associates 29 Will you allow contingency
funds to be transferred to another provider if the consumer
requests this? Does your Board or management committee understand
the contingency funds roll over each year and are no longer
profit/surplus for the organisation? What is your debt collection
process for community care and under what circumstances will you
continue or discontinue providing care if a consumer refuses to
pay? ( remember to refer to the Aged Care Act for guidance)
Slide 30
Other matters Lorraine Poulos and Associates 30 Case management
skills Financial conversations Meaningful solutions Taxi vouchers,
crock pots, assistive technologies Culture change E tools Russell
Kennedy, GGJones Fixed cost and variable incomes
Slide 31
Other matters Lorraine Poulos and Associates 31 Scenario
budgets with and without fees Unspent funds ITA and the lifetime
cap 60K Non charging of fees E tools MYOB live - $900 and $800 50
HCP 40K plus for software programs Office 365 access Rostering
co-ordinators similar to DCW Case management and core advisory
examples Lower fees or no fees level 1 and 2
Slide 32
Other matters Lorraine Poulos and Associates 32 Case scenario
planning 50% occupancy Marketing five clicks on website Brochures
Home Care today information for consumers Examples of HCP being
taken up very quickly/slowly Fees policy and non charging of fees
Training expenses Financial skills of staff Interface between
finance and co-ordinators/home care service ITA lifetime cap how to
sell this
Slide 33
Lorraine Poulos and Associates 33
Slide 34
34 Thank You Further details contact
[email protected] Lorraine Poulos and Associates