The current and emergency regulatory landscape: key reforms since July 2024

• Aged Care Act 2024: The new Act will commence on 1 July 2025, following its Royal Assent on 2 December 2024. The new Act responds to several recommendations of the Royal Commission into Aged Care Quality and Safety and the Final Report of the Aged Care Taskforce. The Support at Home Program will replace and amalgamate the Home Care Packages and Short-Term Restorative Care programs, with the Commonwealth Home Support Programme set to transition no earlier than 1 July 2027. The Rules that accompany the new Act continue to be released in tranches, with Release 2B to be published in late January, Release 3 to be published early February 2025 and Release 4 to be published in early March 2025. The remaining Rules will cover funding for residential care, place allocation, obligations and conditions applicable to registered providers, provider registration, along with further detail around the various reporting and recordkeeping requirements.
• ACQSC Regulatory Strategy: Informed by the recommendations of the Independent Capability Review led by David Tune AO PSM, in August, the ACQSC released its Regulatory Strategy for 2024-25. The Regulatory Strategy details how the ACQSC will cultivate an aged care sector that meets the elevated standards introduced by the new Act. The ACQSC aims to hold the sector accountable to its obligations but will assist providers and workers to deliver high quality care. The Regulatory Strategy outlines a risk-based regulatory approach, meaning monitoring and investigation will focus on specific target areas. Additionally, any actions taken will be proportionate, ensuring that the level of scrutiny and intervention corresponds appropriately to the level of risk presented. The Regulatory Strategy also includes an enhanced ‘provider supervision model’, meaning all providers will be allocated a supervision status, increasing in order of the risk involved and resourcing required. Notably, on 20 January 2025, Ms Liz Hefren-Webb (current Deputy Secretary, Social Policy, Department of the Prime Minister and Cabinet) replaced the inaugural ACQSC Commissioner, Ms Janet Anderson PSM.
• Workforce responsibilities and care minutes: Workforce requirements in residential care, including care minutes and 24/7 registered nurse mandatory targets, are currently a key area of focus for the ACQSC. Providers are required to ensure that a registered nurse is rostered on and on-site at all times. Additionally, providers must deliver an average of 215 care minutes of direct care per resident per day, including 44 minutes of direct care by a registered nurse. According to the ACQSC, only 41% of residential care services met both targets in Q4 of FY24. In response, we are seeing the ACQSC engaging with providers who demonstrate shortfalls in care minute requirements, meaning providers should continue to evidence their efforts to adhere to their obligations.
• Aged Care Transition Taskforce: The Aged Care Transition Taskforce (Taskforce) will support the sector's shift to the new Act, overseeing the reforms encompassing regulations, continuous education and communication, financing and fee structures, as well as data and digital aspects. The Taskforce will meet every 2 weeks and publish meeting summaries on the Department of Health and Aged Care’s website. The Taskforce comprises of 20 members, including Chair Anne Burgess AM (Chair of the Aged Care Council of Elders).
• Single Assessment System: As of December, the Single Assessment System combined and replaced the Regional Assessment Service, Aged Care Assessment Teams and the independent Australian National Aged Care Classification assessors, providing a single assessment pathway for older people to access the system.
• COVID-19 Report: In November, the Prime Minister released the COVID-19 Response Inquiry final report | PM&C (Report). The report highlighted that certain populations, such as older Australians, are at greater risk in a pandemic, recommending and emphasising the need for clear roles and responsibilities between providers, the health system and the Government.

Where to next?

Next steps in the 2025 aged care reform journey 2026 and beyond. Our expectations for the future of the aged care sector:

• By 2045, the population of Australians over 70 is expected to reach 5.5 million, necessitating more specialised and long-term aged care service;
• Workforce shortages will likely increase and be intensified by the shift to a consumer-centric model of care which requires workers to be more qualified;
• The sector will undergo transformation toward increased outsourcing to associated service providers, fostering a more competitive landscape;
• The sector will likely face changing capital needs, including a shift towards greater investment in home care;
• We expect the ACQSC will continue its increasing regulatory involvement;
• We expect that M&A activity will continue to increase, yet this will occur amid the limitations imposed by a tighter regulatory framework.

Our experienced Aged Care Team is here to assist you through these sector reforms. We would be delighted to find out how we can help your organisation. To stay informed with our latest updates about the aged care or disability sector, we invite you to join our mailing list. Please contact Penelope Eden on the email below to be added to the list.