In a much anticipated development, the Government announced this week that it will defer the implementation of formal price caps under the Support at Home program until it has ‘greater confidence in the stability of the market’. 

There has been no mention of a new timeline for the introduction of pricing caps. 

Policy context

In explaining the rationale behind this, the Government stated that price caps only work if they are set at the right level. That is, they must strike a balance between being high enough to keep the sector viable and low enough to actually protect older Australians. The Government specifically pointed to global uncertainty and financial pressures as the primary reason for delaying the onset of pricing caps. There was an acknowledgment that if caps were to be set now, against an unstable baseline of higher than usual prices, it risks going against the very intention of the caps and could instead, adversely impact both older Australians and providers. 

Strengthened consumer protections 

In place of pricing caps, the Government has announced a package of strengthened consumer protections which will include: 

• The Aged Care Quality and Safety Commission (Commission) having greater regulatory powers to order refunds where providers are found to be overcharging and to take enforcement action against providers who fail to meet their transparency obligations. 
   
• A National Summary of Support at Home Prices being published each quarter showing both the median and the range of prices charged by providers. 
   
• Building on the removal of out-of-pocket costs for showering, dressing and continence services, the Department of Health, Disability and Ageing and the Commission monitoring personal care prices as those services transition into the Clinical Care category.
   
• Encouraging providers to limit the frequency of price increases to no more than twice a year. 
   
• Establishing a working group with the Older Persons Advocacy Network (OPAN), Council on the Ageing (COTA) Australia, Ageing Australia and the Commission to develop a more robust definition of 'reasonable' pricing and to consult further on the multi-provider model and self-management arrangements.
   
• Additional funding for consumer advocacy and education through OPAN and COTA Australia.