Aged care providers say time’s up for government to reimburse COVID expenditure

Catholic Health Australia

Amid a sector-wide crisis in financial sustainability, aged care providers around the country are still wondering when hundreds of millions of dollars of emergency COVID expenses will be reimbursed. The Australian Government introduced COVID-19 Support Grants to help providers control outbreaks in their facilities, protecting vulnerable residents and their families, and preventing transmission with the local community. Catholic Health Australia’s Director of Aged Care Jason Kara said that the aged care sector responded strongly throughout the worst of the pandemic, with staff, consumers and their families working together to abide by strict rules to reduce infection risk. “Unfortunately, we see that the Government has still not reimbursed expenditure from 2021/22 and 2022/23,” Mr Kara said. “With around 70 per cent of residential homes running at a loss, age care providers cannot continue to be left out of pocket for COVID-related expenses.” These expenses are impacting providers across the country:

  • Calvary Health Care, a large national provider, has submitted around $55 million worth of COVID grant claims with only $5 million paid out
  • Southern Cross Care (SA, NT & VIC) has claimed just over $6 million with only $230,000 paid out
  • Southern Cross Care (NSW & ACT) has claimed $6 million with $2.2m outstanding
  • Southern Cross Care (Western Australia) has claimed $3.946 million with zero paid out
  • Southern Cross Care (Tasmania) has claimed $1.23 million with zero paid out
  • MercyCare in Western Australia has submitted $1.55 million in claims with only $55,000 paid out
  • Southern Cross Care (Queensland) has had all 2021/22 claims paid but has $600,000 outstanding from 2022/23

This as a pattern across the entire sector. Estia Health released in May an ASX statement which noted $21 million in outstanding COVID grant claims, $8.8 million dating from the 2021/22 financial year. The delays in providing these reimbursements are hard to understand given the wealth of information the Department of Health and Aged Care hold on the cost of COVID outbreaks in aged care facilities. Mr Kara said that it was bureaucracy that is holding up payments that could be done more efficiently and collaboratively. “Bureaucracy has placed numerous barriers to reimbursing providers for their expenditure. This includes insisting on separate claims for each home and outbreak and multiple agencies querying the same claim,” he said. “We have a system that has almost been designed to fail. Claims worth hundreds of thousands of dollars are held up for months by the government agency querying a $100 test expenditure. Common sense tells us that this could be streamlined through paying the approved amount immediately and allowing further discussion on any small, disputed amounts to occur later.” There have been many attempts by providers to work with the Government to improve outcomes under the COVID grants program, however, these are not getting any results. The administration costs of progressing these claims and trying to work with Government are taking providers away from the core business of providing care. Recent Senate estimates testimony disclosed there were 11,000 grant applications and at least half a billion dollars still to be paid to providers. “We have now entered the third financial year of the COVID grants payment scheme and the Government are not learning the lessons of the pandemic and improving the system. The cost of delivering this labour-intensive process would be better redirected to services,” Mr Kara said.

About us:

Catholic Health Australia is Australia’s largest non-government grouping of health and aged care services accounting for approximately 10 per cent of hospital-based healthcare in Australia. Our members also provide around 25 percent of private hospital care, 5 percent of public hospital care, 12 percent of aged care facilities, and 20 percent of home care and support for the elderly.

/Public Release.