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07 Jun 2019

The AMA has submitted its formal comment to the Health Department on the new residential aged care funding model – the Australian National – Aged Care Classification (AN-ACC).

The AMA supports in principle the new funding model and the rigorous research that lies behind it. In particular, the AMA is pleased that a fixed plus variable funding model, adjusted for geographic location is recommended. If designed correctly, this will hopefully address the difficulties imposed by pure activity-based funding for smaller aged care providers in different geographic locations.

The new transparency associated with a case-mix classification and funding model is also a very positive development for aged care providers, Government and consumers. The AMA agrees, this type of model creates the potential at some point in the future, to define staffing requirements by AN-ACC class, and develop best practice models of care for each case-mix/class. This type of transparency is very welcome and is somewhat overdue in the Australian aged care sector.

While activity-based funding has many positives, the success of shifting to an activity-based funding model will depend on the price generated by the funding formula. The AMA notes price is out of scope in this consultation. No matter how robust a funding formula is, if the price paid per activity is too low, or not adjusted to staff wages growth or insufficiently indexed, the funding model cannot generate high quality care and positive resident outcomes.

The full submission can be viewed at:


Published: 07 Jun 2019