Australian Aged Care Industry to be More Consumer and Market Driven, says Frost & Sullivan
Seniors will have more choices and higher quality services at their disposal with the consumer directed care programme
SYDNEY, Sept. 28, 2015 /PRNewswire/ -- Australian aged care systems are moving from a service-based model to a consumer-driven model. In the next 5 to 10 years, Australian seniors will have more choices with regard to the care services they receive as well as the type and quality of services (long-term or service per hour). For providers, aged care will become more competitive and market-driven. By 2021, there will be 2,000 new short-term restorative care places available to help older people stay independent and live in their homes longer.
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New analysis from Frost & Sullivan, Trends and Attractions of the Australian Aged Care Market (http://www.frost.com/q295620554), finds that the market was worth AUD 14 billion in 2014 and estimates this to grow at an annual rate of four percent for the next five years. Of the total market revenues, AUD 9.5 billion was funded by the Federal Government and the rest was privately funded by companies and residents.
The public and private aged care markets in Australia are equally attractive. While the private market is currently highly profitable, it is equally fragmented. The last year saw three key aged care companies, Japara Holdings (www.japarahealthcare.com.au), Regis (www.regis.com.au) and Estias (www.estiahealth.com.au), floating their initial public offerings and this trend continues in 2015.
The public aged care segment will also witness major disruption. The implementation of the Consumer Directed Care programme in July 2015 added an extra 170,000 pensioners to the revised pension scheme. Their pensions will increase by an average of $30 per fortnight.
"Many of the new pensioners in Australia will opt for residential care homes or short-term care as the financial burden softens," said Frost & Sullivan Healthcare Industry Manager Dr Siddharth Dutta. "Seniors choosing residential care homes in 2015 will have to pay a maximum daily fee equal to 85 percent of the single person rate of the basic Age Pension. On the other hand, those who shifted to residential care homes before 1 July 2014 will need to pay the costs under the old fee arrangement."
Due to the new budget system, an estimated 91,000 current part pensioners will no longer qualify for the part pension and a further 235,000 will see a reduction in their pension. To qualify for a full pension, the assets free area will increase to AUD 250,000 for single home owners and AUD 375,000 for couples. Part pensioners with their own homes will have their maximum threshold reduced to AUD 823,000 and AUD 547,000 for couples and singles respectively.
Nevertheless, from February 2017, more than 80,000 people receiving home care packages each year will be able to choose who provides their care. Over 850,000 older people each year will also receive improved services from July 2018 as the Australian Government intends to establish a single home-care programme.
"Overall, the Australian Government subsidises a range of aged care services in the country," noted Dutta. "Seniors who can afford to pay for their daily services are however expected to contribute towards the cost of care."
For complimentary access to more information on this research, please visit: http://corpcom.frost.com/forms/APAC_PR_DJeremiah_9AB9-52_28Aug15.
Trends and Attractions of the Australian Aged Care Market is part of the Life Sciences (http://ww2.frost.com/research/industry/healthcare/life-sciences) Growth Partnership Service program. Frost & Sullivan's related studies include: Healthcare IT Spending in Australia and Major Trends and Attractions in the Global Aged Care Market. All studies included in subscriptions provide detailed market opportunities and industry trends evaluated following extensive interviews with market participants.
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Trends and Attractions of the Australian Aged Care Market
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Contact:
Donna Jeremiah
Corporate Communications – Asia Pacific
P: +61 (02) 8247 8927
F: +61 (02) 9252 8066
E: djeremiah@frost.com
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