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Some Key Legal Issues For Home Care Providers in 2020

Anita Courtney, Solomon Miller, Johanna Heaven
As many providers will be aware, Home Care can be difficult to navigate.  Not only must you manage a consumer’s needs and expectations within their budget, providers must ensure they are complying with legislation and guidelines.

As the year draws to a close, we thought it was worth highlighting some of the key compliance issues that we have dealt with in the home care space in 2020. We anticipate that these areas will continue to be an area of focus for the Aged Care Quality and Safety Commission (Commission) in 2021.

  1. HCP expenditure.

    More than ever, the Commission is scrutinizing home care expenditure and looking at whether providers have allowed funds to be used for purchases that the legislation does not allow.

    The consequence of getting this wrong can go beyond getting a Notice of Non-Compliance and the associated reputational damage that this causes. According to the 2020 Operational Manual, providers who permit a package to be used for non‑permitted expenditure will be required to refund the package to the value of the purchase.  This can have a significant impact where the provider has permitted multiple purchases that the Commission consider should not be approved.

    Whilst the legislation outlines a clear list of care and services that are included and excluded under the program, providers often run into ‘grey areas’ in which it is not clear whether a purchase is permitted. The resultant uncertainty has unfortunately been compounded by “mixed messages” from the regulators over the years about what is and isn’t allowed.

    Some key risk areas include:

    • Home modifications that go beyond very basic modifications, such as kitchen/bathroom renovations.
    • The purchase of everyday items such as internet and mobile phones.
    • Purchases that will benefit people other than the consumer (eg doing works on a home owned by a family member).

    Given the risks of getting it wrong, providers must walk a fine line between respecting client choice and preventing the misuse of package funds. We suggest that providers have a detailed policy that care managers can refer to when making the decision to approve a purchase to provide clarity and support in decision making. Russell Kennedy has a template policy available to assist with this.

     

  2. Adjusting your fees.  

    Providers have also faced scrutiny for increasing their fees without complying with the requirements in the legislation. Changing your fees requires consultation with the consumer and ultimately, a provider cannot increase fees without the consumer’s consent. Importantly, it is not enough to merely write to a consumer to inform them of the change you intend to make.

    We recommend writing to consumers to explain the changes to their fees and giving them the opportunity to ask question. We have prepared a template letter to help providers with this. If you would like assistance with this, please get in touch.

    There is also an option for providers to include a fee variation clause in this agreement for new consumers.  This gives providers the opportunity to raise fees annually by a specified formula (eg CPI or a specified percentage) without further consent. Having a broadly worded clause which says “we can raise our fees by giving you notice” is generally not enough; the clause should be more specific.


  3. HCP agreements.

    The Commission is also continuing to scrutinise HCP client agreements and, to a lesser extent, brokered services/supplier agreements to make sure these are compliant with the various legislative requirements.

    Given that your HCP client agreements are the basis for your entitlement to charge fees, it is critical for providers to ensure their agreements are not only compliant but also that they protect the provider’s commercial interests (eg having a clear fee variation clause as mentioned above).


  4. Pricing Schedules

Again, getting your pricing schedules right is critical. Remember that once you have your pricing schedule in place, it can only be changed with existing consumers with their consent (this will trigger the same consultation process that is mentioned at item 2).

It is important that your Pricing Schedule has prices for all the common services you are required to include (eg make sure you give a price/range of prices for “light gardening”). It is also important that the schedules specifies fees in dollar values, rather than percentages.

Russell Kennedy can assist by reviewing your Pricing Schedule if you would like us to check it is compliant.

 

These are just some of the issues that providers have been dealing with in 2020. With a range of further changes coming to the sector in 2021, it is important that providers review their agreements, Pricing Schedules and policies and procedures to ensure they remain up-to-date and compliant in the new year.

We are here to help

If you require any further information please contact Anita Courtney, Solomon Miller or Johanna Heaven.

If you would like to keep up to date with Alerts, news and Insights from our team, you can subscribe to our mailing list here.

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