The Aged Care Royal Commission
This is the first of a series of articles that Novigi is producing on the need for digital transformation in aged care. This first article discusses the need to act arising from the interim findings of The Royal Commission into Aged Care Quality and Safety. The next article in the series “Data Science, Optimised Care Delivery and Funding” will focus on the application of data science techniques to the development of care plans and in ensuring that funding is distributed fairly throughout the aged care system.
Australia has been found guilty of neglect in its treatment of the elderly. The Royal Commission into Aged Care Quality and Safety released its interim findings on the 31 October 2019, marking the halfway point in the commission's proceedings. The interim report was — to put it lightly — scathing. As surmised in the report’s foreword, the Commission has uncovered an aged care system that “fails to meet the needs of our older, often very vulnerable, citizens...in too many instances, it simply neglects them.”
Neglect
The interim report describes a system whose failures and shortcomings amount to nothing short of a national disgrace. Issues ranging from the overprescription of chemical restraints and psychotropics, to a high incidence of assaults on residents, to widespread malnutrition were found to be systemic. That such issues exist in 21st century Australia was justifiably called out as being shameful. Interim reports generally do not include recommendations. However, so grievous did the Commission deem the state of the aged care system to be, and so urgent the need to act that three recommendations were in fact made:
The provision of more Home Care Packages.
A response to the overuse of chemical restraints.
Action to end the practice of placing younger people with disabilities in aged care.
As the interim report states “It is clear that a fundamental overhaul of the design, objectives, regulation and funding of aged care in Australia is required.”
How did we get here?
Our analysis of the Commission’s findings leads us to believe that two factors are fundamental in explaining the state of the aged care system. These are carers — specifically the number and qualification of those carers — and the economics of aged care more generally.
Carers
The interim report commented that “most nurses, carer workers and allied health practitioners delivering care are doing their best in extremely trying circumstances where there are constraints on their time and on the resources available to them.” Many of the issues described by the Commission can be traced back to the fact that there are simply not enough carers, and that of the carers employed in the industry, not enough are sufficiently well-trained and qualified. Despite the clear need to attract large numbers of highly-qualified and capable carers, pay and conditions for these staff are poor — signalling that the economy more broadly does not value work in aged care.
Aged care can be an incredibly challenging environment for carers. Older Australians are often affected by a wide range of challenging conditions, with dementia and other afflictions that impact cognitive and physical functioning posing particularly profound difficulties. Despite this, aged care workers are often not sufficiently trained to care for sufferers of these conditions.
We believe the solutions to these issues with the aged care workforce have two main aspects:
Changing conditions in aged care (i.e. salary, minimum training standards, numbers of staff) such that the industry can better attract and retain large numbers of well-trained, highly competent carers.
Fostering innovations that augment the abilities of carers, allowing them to spend more time actually caring for the elderly, rather than on peripheral tasks.
The Economics of Aged Care
The economics of aged care in Australia are broken. As the Commission noted, though the aged care sector in this country sees itself as an “industry” in the private sense, 80% of all funding for aged care comes from the government. More funding is clearly needed for aged care; the interim report’s recommendation that more Home Care Packages be provided has been priced at an estimated $2.5 billion — and this is just one of many areas that need to be addressed.
Take the issue of carers we raised in the previous section. The 2016 National Aged Care Workforce Census and Survey (NACWCS) estimated that there were 153,854 working in residential direct care roles. The Census also finds that the median weekly earnings (gross) of these workers is $800/w. The Commission’s interim report finds that, on average, the aged care workforce is paid 15% less than equivalent roles in other sectors (e.g. healthcare). Doing a rough back of the napkin calculation, we find that increasing salaries to parity with other industries would cost in the order of $1 billion. If we then consider increasing the number of carers — as will invariably be recommended by the Commission’s final report — we find that the numbers become very large very quickly. A doubling of the number of residential carers would cost in the order of $7-8 billion. While doubling might seem extreme, note that in the period from 2012-2016 the number of carers grew by 17%, to a number that we are confident the Commission will still deem manifestly inadequate. This figure, of course, only covers residential care. It also fails to take into account that the sectors that aged care is being compared to — such as healthcare — also have issues in meeting the demand for staff. Clearly the sums involved are not trivial.
Aged care, like healthcare, has to contend with a fundamental limit to productivity. Whereas other industries can reasonably expect exponential growth in productivity — the ratio of mobile phones produced to factory workers employed is constantly on the increase — aged care cannot. A future in which a single aged care worker sees 1000 elderly people a day would not be a desirable one. Human contact is a key component of care, and we believe that any increase in productivity should not come at the expense of meaningful contact between the carer and the cared for. Perhaps rather than number of elderly cared for, a more pertinent metric might be the number of hours of meaningful contact spent with each elderly person.
Where to next?
The Role of Technology and Innovation
Technology and innovation have a key role to play in improving aged care and addressing the issues raised by the Commission. The amount of meaningful contact that carers have with older people can be increased in two ways:
Non care related activities that are currently the remit of care staff can be digitised, streamlined and automated where possible.
Non care related roles can be digitised, streamlined and automated where possible, and the associated resources reallocated to direct care roles.
A paper published in the Australian Health Review in 2016 titled Nursing staff work patterns in a residential aged care home: a time–motion study, tracked the time two nursing staff working in residential aged care allocated to different tasks. The three tasks that consumed the largest proportion of the carers’ time were verbal communication (~28%), medication administration (~25%), and documentation (~19%). While we don’t see verbal communication as an area in which efficiency dividends should be sought, medication administration — approximately 16% of which was medication preparation — is an area in which automation could drastically reduce the burden on care staff. Documentation too, is an area in which technology can yield significant gains in productivity. In our work with aged care clients we have found manual and duplicate data entry to be the norm. If system integration and process automation could halve the amount of time spent on documentation, care staff could have an additional 45 minutes to an hour each day to spend on care.
The NACWCS found that in 2016 there were 366,027 PAYG workers in aged care, across both residential care, home care and home support outlets. Of these 125,710, or 34.3%, were not employed in a direct care role. While we are certainly not suggesting that non-direct care roles are unimportant or inessential, we do posit that digitisation and automation of some of these functions could happen without adversely impacting the elderly people who depend on them. In a system with a finite pool of funding, directly related to the number and needs of the elderly people in its care, any cost savings associated with automation of non-care roles could and should be redirected to care.
New technologies are on the cusp of bringing real benefits to the aged care system. The Commission’s interim report makes many references to the “innovations required to deliver high quality care”, and the failure of the current system to innovate. In the work we do with aged care providers we stress the importance and power of data. From basic reporting and dashboarding, to the promises of artificial intelligence and machine learning, we see many opportunities for improvements in aged care. In his recent book Deep Medicine: How Artificial Intelligence Can Make Healthcare Human Again, Eric Topol discusses how artificial intelligence can automate away some of the functions of healthcare, allowing doctors to spend more time listening to and having meaningful interactions with patients. Our hope for artificial intelligence and machine learning in aged care is that it might allow carers to do the same.
The path ahead for the aged care system will not be an easy one. The Royal Commission will deliver its final report in November 2020, and it will invariably recommend sweeping changes. The Australian government will need to increase levels of aged care funding. At the time of writing, $496.3 million in new funding for home care packages had been announced — well short of the $2.5 billion required to clear the waiting list. Funding for a reduction in the use of chemical restraints, dementia related training and the removal of young people from residential care was also announced, totalling $40.2 million. We hope that the limited nature of this response does not reflect the seriousness or urgency that the government places on the crisis in aged care and that more funding will be forthcoming.
Aged care providers also have a key role to play in embracing innovation to improve care outcomes for the elderly. Innovation is a process — one that involves cycles of experimentation and validation in which not every initiative trialled will be successful. Having good partners along the way will be invaluable, but at the heart of it the onus is on providers to act. The consequence of failing to do so is neglect.
Melissa Fuller is a Partner at Novigi, and is based in the Sydney office.
Kevin Fernandez leads the Advisory Services function at Novigi, and is based in the Melbourne office. For more information about anything you’ve read here, or if you have a more general inquiry, please contact us.