That the Australian Government addresses loopholes in the tax system that enable for-profit aged care providers to avoid and minimise tax.
The relationship between growing profits for aged care providers and declining quality of care needs to be thoroughly examined. The report reveals that the largest company researched, BUPA, had almost $7.5 billion in total income in Australia in 2015-2016 but paid only $105 million in tax on a taxable income of $352 million. BUPA’s Australian aged care business made over $663 million in 2017 and over 70 per cent of this was from government funding. Funding from government and resident fees increased in 2017, but BUPA paid almost $3 million less to their employees and suppliers. This demonstrates a trend that for-profit aged care companies are compromising on providing quality care services and are instead choosing to direct their attention towards maximising profit.
The financial practices of for-profit aged care providers not only manifests in the avoidance of tax, but also in other cost cutting measures such as employing too few staff and staff with lower levels of qualifications. Staffing represents the highest cost of care for aged care providers, comprising around 60 per cent of total care expenses. In 2003, 21 per cent of the direct care workforce was registered nurses (RNs) and 13.1 per cent was enrolled nurses (ENs). In 2016, this had decreased to 14.6 per cent and 10.2 per cent respectively. The proportion of personal care attendants (PCAs) increased from around 58 per cent in 2003 to represent over 70 per cent of direct care workers in 2016. PCAs continue to grow both numerically and as a proportion of the residential aged care workforce.
Attempts to cut staffing costs is evidenced in the decrease of RNs and ENs employed in aged facilities, who receive higher wages, and the increase in personal care workers, who receive lower wages. In 2016, the gross median weekly wage reported by RNs was $1,352 and by ENs it was between $1,000 and $1,050, compared to a median weekly wage of $689 for PCAs.
RNs as well as ENs practicing within the scope of their training provide specialised clinical and medical care to aged care recipients. RN’s are senior, university trained professionals that administer medications, provide palliative care, change catheters and ensure that changes in residents conditions are picked up. The scope of practice of an EN and RN are different. An EN must work under the direct/indirect supervision of an RN at all times. ENs contribute to care planning but may not act independently, as the RN retains overall responsibility. While the majority of PCAs hold a tertiary level qualification , their job is to provide basic personal care and support. The growing numbers of PCAs cannot replace the loss of RNs in aged care facilities, as medical and clinical care are out of PCA’s scope of practice. Only RNs can provide the medical and clinical care that resident’s need. CPSA is concerned about the impact of deskilling of the aged care workforce on the quality of care being delivered. As the skill mix of the aged care workforce is increasingly constrained to staff without the ability to provide clinical and medical care to residents, the safety and wellbeing of residents is compromised.
This is especially pertinent considering the increasingly complex and acute care needs of those entering residential aged care. The Australian Government’s ageing in place policy has meant that people have increasingly been able to fulfil their desire to live independently for longer. This also means that those who enter residential aged care have increasingly complex and acute care needs. In 2004-2005, 62.9 per cent of people in residential care were classified as having high care needs and in 2016 this had increased to 92 per cent of residents. Providing quality care for people with complex needs takes more time and a broader range of skilled professionals.
Not only is there is limited pool of skills within the aged care workforce, there is also numerically not enough staff, meaning care workers do not have enough time to properly care for residents. Overall, there has been a modest increase of 3.3 per cent in the number of full time equivalent employees in direct care roles between 2012 and 2016. However, the rate of increase in the residential full time equivalent direct care employees was smaller than the corresponding 4.6 per cent headcount increase. This suggests that there has been growth in part-time employment and an increase in the proportion of workers employed for fewer hours.
Aged care workers have repeatedly reported that they are not able to spend the appropriate amount of time delivering quality care to residents. A study found that residents living in Australian nursing homes received an average of 2 hours and 50 minutes of direct care per day, but that at a minimum they required 4 hours and 18 minutes of care per day. The shortage of care time staff are able to provide to residents has serious medical and physical implications for residents. A discussion paper released by the Department of Health estimated that the prevalence of pressure sores among aged care residents was between 26 per cent and 42 per cent. Additionally a recent study estimated that there has been a 400% increase in premature deaths among nursing home residents since 2000. There is clearly an inadequate skill mix and not enough staff employed to ensure quality of care and the safety of residents.
For-profit aged care companies’ increasing profits demonstrate that they have the financial capacity to improve staffing to deliver safer and better care for residents. However, they are choosing to focus on maximising profit by cutting staff hours and constraining the skill mix of employees which has serious implications on the quality of care delivered.