Residential aged care facilities will receive a funding increase of 3.2%, the highest increase since 2009 across all four care categories, rest home, dementia, hospital and psychogeriatric.


However, the New Zealand Aged Care Association (NZACA) is reportedly most pleased with the way negotiations played out this year.


For the first time ever, the NZACA, the District Health Boards and the Ministry of Health agreed at the start of this year’s ARRC (Age-Related Residential Care) negotiations to work together in establishing and modelling cost pressures as they affect rest home providers.


NZACA chief executive Simon Wallace says this was done through a data collection process from the sector and all these costs were then modelled and agreed between parties.

“There was a lot of work that went into this, the end result being agreement on costs.”

Wallace says the 3.2% result, which in dollar terms is an injection of approximately $60 million into the sector, would not have been achieved without this collaborative work.

“The same process will be followed in future years and will I believe lead to more realistic and sustainable increases that reflect the real cost pressures facing rest home businesses.   It was an example of bringing an evidence base to the negotiating table.”

However, the increase does not see aged care nurses achieving pay parity with RNs in public hospitals. Wallace says this is “a longer game”.

“But it does restore aged care nurses to the relativities that existed prior to the MECA that was signed with hospital nurses in August 2018.  The NZACA will continue to lobby for aged care nurses to paid at relativity with their hospital counterparts,” he says.

Pay equity uplift prices for 2019-2020 have also been confirmed.

Of course pricing could take a different approach next year. The sector Funding Model Review has been completed by EY and is currently under review.

Wallace says the NZACA, like the other stakeholders involved, has seen the full 500-page report.

“There is a lot in the report about moving to an interRAI RUGS-based assessment, a rural adjuster, a turnover payment for short stay and respite care and acknowledgement of palliative, but nothing is set in stone as yet.”

All will become clear when the report is released later in July.



Please enter your comment!
Please enter your name here