Improving Consumer‐Centred Aged Care: Addressing Issues of Sustainability, Service Integration and Market Incentives

• Published date: 01 June 2021
• Author: Michael Woods,Grant Corderoy
• Date: 01 June 2021
• DOI: http://doi.org/10.1111/1467-8462.12425

The Australian Economic Review, vol. 54, no. 2, pp. 266–274 DOI: 10.1111/1467-8462.12425

Improving Consumer‐Centred Aged Care: Addressing Issues of

Sustainability, Service Integration and Market Incentives

Michael Woods and Grant Corderoy*

Abstract

The Australian Government is preparing to

implement its next tranche of reforms to publicly

subsidised aged care services. While prompted

by the Royal Commission into Aged Care Quality

and Safety, this is also the next step in an

ongoing program of improvement. System sus-

tainability should remain a core concern, shared

alike by consumers, providers, regulators and

taxpayers. Some unfinished business should also

be addressed. First, creating an integrated range

of client‐centred services; second introducing

market‐based incentives that empower residential

care consumers to exercise choice and control

and encourage competing providers to improve

quality, safety and efficiency.

1. Introduction

Aged care in Australia has been on a decade

long journey of reform. While much has been

achieved there remains significant unfinished

business, of which overcoming the failures of

quality and safety has attracted deserved

attention. This article addresses three other

outstanding issues that, when addressed, will

also make noteworthy improvements to the

delivery of consumer‐centred care and support

to older people.

The first is a long term issue—that of

sustainably funding aged care services and

achieving an equitable balance between public

subsidies and consumer contributions. A second

issue, one of the key reforms highlighted a

decade ago that has yet to be fully addressed, is

the integration of the current disparate programs

of care into a regime that is more holistic and

responsive to consumers’needs. The third, also a

decade in waiting, is the empowerment of

residents of aged care homes to have greater

choice and control over the home they wish to

live in and the services that they wish to receive,

in tandem with the harnessing of market

incentives to improve the services delivered to

them by residential care providers.

But first, a precis of the policy framework

within which the reforms have been developed.

2. The Policy Framework for Aged Care

Reform

While there were legislative changes to aged

care in 1997 the current reform path was laid out

* Woods: CHERE Centre for Health Economics Research

and Evaluation, University of Technology Sydney, New

South Wales, 2000, Australia; Corderoy: Stewart‐

Brown, Chatswood, New South Wales, 2067, Australia.

Corresponding author: Woods, email <Michael.Woods@

chere.uts.edu.au>.

© 2021 The University of Melbourne, Melbourne Institute: Applied Economic & Social Research, Faculty of Business

and Economics

Published by John Wiley & Sons Australia, Ltd