MARKET REPORT SUMMARY Average length of stay in residential aged care has decreased gradually II. CHANGING NEEDS AND PREFERENCES The aged care system will also need to respond to changing preferences and community expectations about how and where care is delivered. The majority of older people prefer to remain in their own home, delaying entry into residential care until later in life, if at all. This preference has increased demand for home care packages, including demand for higher level supports in the home. Changes to the overall burden of disease in old age have also affected residential care needs. At least half of residential aged care residents have a dementia diagnosis and are more likely to have higher care needs than residents without dementia. The average length of stay in residential aged care has decreased gradually from 3.30 years in 2003 to 2.96 years in 2019. In addition to the Royal Commission, the COVID-19 pandemic has reinforced the importance of Australia having a robust aged care sector that can manage – and adapt to – unforeseen, sudden health shocks. DRIVERS OF AGED CARE SPENDING I. TRANSFORMATION OF THE AGED CARE SECTOR The Government is making major reforms to the aged care sector that will occur in stages over many years. The Government has already made large investments to improve the safety and quality of residential aged care services and improve access through additional home care packages. Other initiatives will also improve workforce recruitment, retention and quality in the aged care sector. The Government’s reforms to aged care will be underpinned by a new consumer-focused Aged Care Act, supported by strengthened governance arrangements. The role of the Independent Hospital Pricing Authority will also be expanded to help ensure that aged care costs are directly related to the care provided. These transformations cater to changing community expectations about how and where care is delivered, which will increase aged care costs. The Government response to the Final Report of the Royal Commission has accepted or accepted-in-principle 126 of the 148 recommendations. In addition, there are a further four recommendations where the Government supports an alternative approach to implementation. A small number of recommendations continue to be considered. Government’s reforms to aged care will be underpinned by a new consumer-focused Aged Care Act, supported by strengthened governance arrangements Majority of older people prefer to remain in their own home, delaying entry into residential care until later in life At least half of residential aged care residents have a dementia diagnosis AL-`AQAR HEALTHCARE REIT ANNUAL REPORT 2021 062
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