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New report outlines residential aged care funding reform options

The release of a new report into aged care funding highlights a range of options to modify Australia’s residential care funding instrument.   
Minister for Aged Care, Ken Wyatt AM, said the Review of the Aged Care Funding Instrument (ACFI) would inform the Turnbull Government’s continuing aged care reforms.
“We are determined to put residential care funding on a more consistent, sustainable and equitable footing,” said Minister Wyatt.
“The Commonwealth currently contributes a record $18.6 billion per year to aged care and by 2020-21 this is expected to reach more than $22 billion.
“We are committed to a system centred on safe, quality care for our older Australians, while ensuring expenditure is affordable for consumers and sustainable for taxpayers.” 
The report, prepared by Applied Aged Care Solutions, undertook a comprehensive review of ACFI, focusing on ways to improve the current tool, including adapting it for external assessments of funding needs and updating it to bring it into line with current care practices.
“We welcome the new report on residential aged care funding reform, which adds to the options provided in a recent University of Wollongong report,” Minister Wyatt said.
The Government-commissioned study was released in April this year, outlining a variety of potential new funding models and tools for the aged care sector. 
Minister Wyatt said no decisions had been made, with the next step in the long-term reform process a Resource Utilisation and Classification Study, now underway at the University of Wollongong’s Australian Health Services Research Institute.
This study is investigating the drivers of residential care costs, according to location and the varying needs of individuals in care.
“We will continue to monitor use of the existing Aged Care Funding Instrument to ensure expenditure remains under control, while maintaining quality care,” Minister Wyatt said.
“We are equally committed to continue working with the community and the aged care sector to get these reforms right.”
The report is available on the Department of Health’s website.

Australian Seniors Amongst The Poorest In The World

The government hopes pension increases will help lift seniors out of poverty, after a report found Australia has the fourth highest poverty rate for people aged over 65.

A report by the Organisation for Economic Cooperation and Development (OECD) shows close to 27 per cent of people aged over 65 have incomes below the poverty line.

According to the report, only Ireland, Korea and Mexico have higher rates.

Based on 2006 figures, the report shows that 3.5 per cent of Australia's national income is spent on pensions.

This compares to an average of seven per cent of GDP in other OECD countries.

The report says the poverty levels of older Australians "is mainly due to the relatively low level of the aged pension" which is around $280 a week for singles.

"The OECD welcomes the government's increases in the age pension to address this problem," the report said.

Families and Community Services Minister Jenny Macklin said pension reform was long overdue.

"The reforms ... will improve adequacy, make it simpler and more responsive to pensioners needs and secure the sustainability of the pension system as the population ages," she said in a statement.

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