Explanatory Memorandum
(Circulated by authority of the Minister for Health and Ageing, the Hon Mark Butler MP)Outline and Financial impact statement
The Aged Care and Other Legislation Amendment Bill 2025 (the ACOLA Bill) makes technical and consequential amendments to support the commencement of the Aged Care Act 2024 (the new Act). The new Act replaces the Aged Care Act 1997 (the old Act), the Aged Care Quality and Safety Commission Act 2018 (the Commission Act) and the Aged Care (Transitional Provisions) Act 1997 (the old Transitional Provisions Act) as the Commonwealth's primary aged care legislation.
The amendments made by the ACOLA Bill are essential to support the seamless transition for individuals accessing aged care services from the system established under the old Act to the new risk-based regulatory model designed to encourage delivery of high quality funded aged care services by registered providers and increase provider accountability established under the new Act. As such, the ACOLA Bill is a critical enabler of the Government's aged care reform agenda which responds to recommendations from the Royal Commission into Aged Care Quality and Safety.
The Bill comprises three Schedules.
Schedule 1 – Amendment of the Aged Care Act 2024
Schedule 1 provides for amendments to the new Act which make technical amendments and editorial corrections which ensure that the new Act supports intended policy outcomes. The matters provided through these amendments:
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- allow different subsidy calculators to be set out in the rules for cohorts of people who are already receiving funding under the aged care system, implementing the 'no worse off' principle
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- enable unspent funds accrued on behalf of older persons to remain available to them under the new system
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- provide for interim funding for services for older persons during high demand periods
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- mandate a review of the Aged Care Quality Standards every five years
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- ensure that compliance data, both current and historical, can be used to inform Star Ratings
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- provide authorisations for automation of decisions by Services Australia and the Department of Veterans' Affairs related to means testing and subsidy calculations.
Schedule 2 – Amendment of the Aged Care (Consequential and Transitional Provisions) Act 2024
Schedule 2 provides for amendments to the Aged Care (Consequential and Transitional Provisions) Act 2024 which make technical amendments and editorial corrections to support transition from the existing system established under the old Act to that established under the new Act. In addition, these amendments provide for several new matters including:
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- authorising the collection, use and disclosure of relevant protected and personal information acquired under the old Act, old Commission Act, Social Security Act 1991, Social Security (Administration) Act 1999 or in relation to grant-funded aged care programs to prepare for implementation of the new Act;
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- bringing the information noted above into the information management regime of the new Act to ensure it can be used for the purposes of that Act as well as maintaining appropriate protections for its use and disclosure; and
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- introducing a new time-limited rule making power which empowers the Minister, during the first two years of operation of the new Act, to make rules modifying the operation of primary legislation to ensure that continuity of care is maintained for older persons in the event of unforeseen or unintended circumstances arising during transition and implementation of the new rights-based aged care system established by the new Act.
Schedule 3 – Amendments of other Acts
Schedule 3 includes provisions which make consequential amendments to a range of Commonwealth legislation to reflect the repeal of the old Act, Commission Act and the old Transitional Provisions Act. These amendments ensure that legislation affected by the repeal of the old law reflect the concepts and terminology used within the new Act, and that references to the old laws are read as references to the new Act and associated legislative instruments. This Schedule also includes provisions to amend the Healthcare Identifiers Act 2010 (Healthcare Identifiers Act) to enable healthcare identifiers and other identifying information to be used in relation to the delivery of health and aged care and other support services, including the delivery of disability services, and for health-related and health administration purposes.
Financial Impact Statement
Healthcare Identifiers Act amendments
As part of the 2022-2023 Budget, government agreed to continue the Health Delivery Modernisation (HDM) Program, providing $96.8 million over 2 years for Phase 3 projects to deliver new digital health services and continue to modernise health payment systems. $3 million was allocated to the then Department of Health and Aged Care (the Department) to review and modernise the Healthcare Identifiers legislative framework and Service to ensure it supports and improves the exchange of health information.
Services Australia was allocated $5.698 million in the 2024-25 Budget to enhance the Healthcare Identifier Service in order to support the proposed legislative changes to incorporate the care sector and health administration entities into the healthcare identifiers framework.
There are no other financial impacts related to the provisions contained within the Act.
Impact Analysis
Healthcare Identifiers Act amendments
An Impact Analysis in relation to the amendments to the Healthcare Identifiers Act has been prepared in consultation with the Office of Impact Analysis. A copy of the Impact Analysis is attached at the end of this Explanatory Memorandum.
There are no other regulatory impacts related to the provisions contained within the Act.