This audit would examine the effectiveness of the Department of Health, Disability and Ageing’s; the Independent Health and Aged Care Pricing Authority’s; and the Aged Care Quality and Safety Commission’s exercise of functions in relation to supporting residential aged care provider viability.

In 2023, the Aged Care Taskforce reviewed funding arrangements for aged care and noted that structural issues mean that the residential aged care sector’s financial viability is poor. Five recommendations were specifically aimed at modernising accommodation funding and improving viability. The government’s September 2024 response to the recommendations included commitments to changes to ensure residential aged care providers have the funds they need to invest in residents’ comfort, keep facilities open and build new facilities; and reviews of accommodation pricing and the accommodation supplement. Regulatory changes are anticipated with the commencement of the Aged Care Act 2024 on 1 November 2025. The Act includes provisions designed to support the viability of for-profit and not-for-profit residential aged care providers.