The real story - care funding will be cut by $500M over next 12 months, says LASA

Leading Age Services Australia CEO Gerard Mansour says the sector will lose more than $500 million in Government funding over the next financial year – a cut of between five and 10 per cent for every provider. "The industry cannot come to terms with how the high-profile budget announcement of a $50 million 'redirection' for next financial year has resulted in reduced funding of over $500 million in the 2012/13 funding allocation for residential aged care homes. While the government describes its cuts as ‘shaving’ or ‘limiting’ subsidies, the reality is a major reduction in funding. What this means is that after 1 July a new resident will be entitled to less care for exactly the same care needs, a concept the industry rejects but will be forced to implement,” he said. LASA urged the government to delay the funding changes by a month, so providers could adjust to the new system and the government could explain the reasons for the discrepancy between the promises of its recent aged care package and the reality for providers. However these appeals have been ignored. LASA gives the example of a resident returning from hospital and being re-assessed under the new scheme will lose $50.00 per day in subsidy income, or $18,250.00 per annum. The provider of this aged care home will need to sack a care worker to pay for this single loss on subsidy, they say.