Aged care reforms. The cost of non-compliance and how to avoid it.

Those in the industry will know only too well that Australia's aged care sector is about to be shaken up with the introduction of the new rights-based Aged Care Act, effective from 1 July 2025.

This legislation prioritises the rights, autonomy, and dignity of older Australians, shifting the focus from a provider-centric model to a person-centred approach. The changes are designed to drive good governance as well as high-quality outcomes.

While implementation discussions often zero-in on financial penalties, the true cost of non-compliance lies in operational inefficiencies, diminished care quality, and reputational damage that can result from neglecting these reforms.

Embracing the new Aged Care Act isn't just about adhering to regulations, it's about enhancing the overall quality and sustainability of aged care services. The Act introduces several key areas where compliance aligns with sound business practices:

• Enhanced risk management: The Act mandates a proactive, risk-based regulatory framework, emphasising the identification and mitigation of potential issues before they escalate.

• Promotion of a learning culture: Providers are encouraged to foster environments where continuous improvement is paramount, leading to better care outcomes and staff satisfaction.

• Strengthened governance: Clearer accountability structures and governance requirements not only ensure compliance but also enhance organisational efficiency.

• Improved resident satisfaction: By upholding the rights and choices of residents, providers can expect higher satisfaction rates, leading to positive word-of-mouth and increased demand.

Action steps to align with the new Aged Care Act

It is not a coincidence that some of the key changes in the legislation are also proven practices that just make good business sense. This includes heightened risk management and continuous improvement requirements:

• Become obsessive about learning from your mistakes: Implement structured methodologies to identify underlying causes of incidents, enabling systemic improvements and preventing recurrence.

• Actively manage risks and controls: Develop and maintain comprehensive risk management systems that identify, assess, and mitigate risks to individuals, staff, and operations.

• Understand and drive quality processes: Integrate quality improvement processes into daily operations, ensuring continuous monitoring, evaluation, and enhancement of care services.

The changes should mean more than just additional compliance obligations, they should reinforce a strong commitment to excellence in care.

Reach out to ⚡Virtus Advisory⚡ to discuss.