Confusion over premium rooms in rest homes has led to an increased number of complaints to Consumer NZ according to the NZ Herald.

The rules around premium rest home rooms state that if no standard rooms are available a new resident can be charged for a premium room only if occupancy at the facility is 90 per cent or more, and it has found another facility within 10km with standard rooms available. If the above conditions aren’t met the provider must admit the resident and must not charge extra for a premium room.

New Zealand Aged Care Association chief executive Simon Wallace says he isn’t aware of there being a widespread problem around confusion over premium charging.

Wallace says providers could be clearer with customers about what makes a premium room premium. Premium charging relates to the features of the room, such as having an en suite or garden access, not the level of care provided. They can range in cost from $50 to more than $400 a week.

Wallace says it can be a stressful time when a person is admitted to rest home care and there can be a tendency for some of the detail to be “glossed over” during this admission process.

Providers have access to a template admission agreement that sets out a rest home’s obligations. However, there is no requirement for providers to use this.

The Commission for Financial Capability (CFFC) says it doesn’t monitor the aged care industry so it can’t be sure if confusion over premium charging is a widespread problem.

“But we have received 100% increase in the numbers of enquires about the costs of aged care generally over the last year,” says Troy Churton, CFFC’s national manager for retirement villages.

The CFFC has had queries from people confused about rest home charges after they have moved from independent living within a retirement village to rest home level care due to a decline in health. Villages and rest homes often operate under different financial models, and it can be difficult for customers to navigate between the two sectors.

“The distinctions between retirement villages, aged care facilities and retirement villages offering care facilities is blurring as more retirement village operators market themselves as offering care,” says Churton.

“What we see is a lot of intending retirement village residents have very limited grasp of the distinctions between having an ORA of an independent unit, of a serviced apartment or of entering a care facility and buying care via an ORA.”

“Retirement villages are required to make certain degrees of disclosure about any transfer into care from the village unit to a care facility on their own site, but the extent of disclosure being made about transferring into full time residential care or shorter term respite type of care seems open to interpretation,” says Churton.

Churton says the CFFC will be conducting a monitoring project looking closely at the interface between villages and their care facilities this year.


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