Final Report on RREF 2001 - Department of Health
Final Report on RREF 2001 - Department of Health
Final Report on RREF 2001 - Department of Health
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FINAL REPORT<br />
REVIEW OF THE<br />
RELATIVE RESOURCE EQUITY FORMULA<br />
IN THE HOME AND COMMUNITY CARE PROGRAM<br />
IN VICTORIA<br />
CONSULTANCY REPORT PREPARED BY<br />
CUMPSTON SARJEANT PTY LTD<br />
FOR THE DEPARTMENT OF HUMAN SERVICES<br />
JULY <strong>2001</strong>
Abbreviati<strong>on</strong>s and Note <strong>on</strong> Terminology................................................................. i<br />
Acknowledgements ............................................................................................. iii<br />
C<strong>on</strong>sultancy Team...............................................................................................iv<br />
EXECUTIVE SUMMARY ............................................................ V<br />
PART A: BACKGROUND AND SCOPE OF THE <strong>RREF</strong> REVIEW ... 1<br />
Scope <strong>of</strong> the Review............................................................................................ 1<br />
HACC Program Objectives and the Resource Allocati<strong>on</strong> Process............................... 3<br />
The Review process ............................................................................................ 4<br />
Role <strong>of</strong> the <strong>RREF</strong> in the HACC Program ................................................................. 7<br />
The HACC target populati<strong>on</strong> in the current <strong>RREF</strong> ................................................... 9<br />
Pr<strong>of</strong>ile <strong>of</strong> current users <strong>of</strong> HACC services..............................................................12<br />
What revisi<strong>on</strong> <strong>of</strong> the <strong>RREF</strong> can and cannot achieve ...............................................13<br />
PART B: DEVELOPMENT OF OPTIONS FOR A REVISED <strong>RREF</strong> 15<br />
STEP 1: OPTIONS FOR DEFINING THE <strong>RREF</strong> BASE<br />
POPULATION.................................................................... 16<br />
1.1 Identifying those in need <strong>of</strong> HACC services ............................................16<br />
1.2 Prevalence <strong>of</strong> core activity restricti<strong>on</strong>.....................................................17<br />
1.3 Populati<strong>on</strong> living in the community <strong>on</strong>ly .................................................18<br />
1.4 Adjusting for the frail aged comp<strong>on</strong>ent <strong>of</strong> the HACC target populati<strong>on</strong>......19<br />
1.5 Other exclusi<strong>on</strong>s ..................................................................................22<br />
1.6 Summary <strong>of</strong> opti<strong>on</strong>s for defining the <strong>RREF</strong> base populati<strong>on</strong> .....................24<br />
1.7 Further issues and preferred opti<strong>on</strong>s .....................................................25<br />
1.8 Resoluti<strong>on</strong> <strong>of</strong> opti<strong>on</strong>s for the <strong>RREF</strong> base populati<strong>on</strong> ................................31<br />
STEP 2: OPTIONS FOR VARIABLES FOR RECOGNISING<br />
NEED IN THE <strong>RREF</strong>........................................................... 32<br />
2.1 Range and nature <strong>of</strong> need variables ......................................................32<br />
2.2 Criteria for assessing variables for inclusi<strong>on</strong>............................................34<br />
2.3 Assessment <strong>of</strong> variables .......................................................................35<br />
2.4 Opti<strong>on</strong>s for c<strong>on</strong>siderati<strong>on</strong> for need variables...........................................38<br />
2.5 Further issues and preferred opti<strong>on</strong>s for need variables...........................39<br />
2.6 Resoluti<strong>on</strong> <strong>of</strong> need variables for inclusi<strong>on</strong> in <strong>RREF</strong>...................................40<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong><br />
i
STEP 3: OPTIONS FOR SCALING NEED VARIABLES.......... 41<br />
3.1 Need for a standard ruler for different variables .....................................41<br />
3.2 Opti<strong>on</strong>s for scaling need variables for inclusi<strong>on</strong> in the <strong>RREF</strong>.....................42<br />
3.3 Further issues and preferred opti<strong>on</strong>s .....................................................42<br />
3.4 Resoluti<strong>on</strong> <strong>of</strong> scaling <strong>of</strong> need variables...................................................42<br />
STEP 4: OPTIONS FOR WEIGHTING NEED VARIABLES.................... 43<br />
4.1 Weighting <strong>of</strong> need variables in related formulas......................................43<br />
4.2 Principal comp<strong>on</strong>ents analysis ...............................................................44<br />
4.3 Expert advice.......................................................................................44<br />
4.4 Effects <strong>of</strong> weighting <strong>of</strong> variables............................................................45<br />
4.5 Opti<strong>on</strong>s for c<strong>on</strong>siderati<strong>on</strong> for weighting <strong>of</strong> need variables........................45<br />
4.6 Further issues and preferred opti<strong>on</strong>s .....................................................46<br />
4.7 Resoluti<strong>on</strong> <strong>of</strong> opti<strong>on</strong>s for weighting <strong>of</strong> need variables..............................48<br />
PROFILES OF NEED VARIABLES ................................................ 49<br />
Variable 1: Median Household Income - MHHY ....................................................50<br />
Variable 2: <strong>Health</strong>y Years <strong>of</strong> Life Lost to Disability – YLD ......................................52<br />
Variable 3: Cultural diversity: % <strong>of</strong> populati<strong>on</strong> in LGA speaking a language other<br />
than English at home .........................................................................................55<br />
Variable 4: Koori Populati<strong>on</strong> - % <strong>of</strong> LGA populati<strong>on</strong> identifying as Koori .................58<br />
Variable 5: Accessibility and Remoteness Index for Australia - ARIA ......................61<br />
PART C: OUTCOMES ............................................................ 64<br />
STEP 5: OUTCOMES FOR BASE POPULATION OPTIONS AND<br />
PROJECTIONS ...................................................................... 66<br />
5.1 Factors affecting outcomes ...................................................................66<br />
5.2 Opti<strong>on</strong>s for c<strong>on</strong>siderati<strong>on</strong> for Base Populati<strong>on</strong>s and Projecti<strong>on</strong>s ................66<br />
5.3 Further issues and views <strong>on</strong> outcomes...................................................67<br />
5.4 Modeling revised opti<strong>on</strong>s for Base Populati<strong>on</strong>s........................................67<br />
5.5 Revised outcomes for Base Populati<strong>on</strong>s .................................................67<br />
STEP 6: OUTCOMES OF WEIGHTING FOR NEED VARIABLES ............. 69<br />
6.1 Method and outcomes reported.............................................................69<br />
6.2 Opti<strong>on</strong>s for c<strong>on</strong>siderati<strong>on</strong> for weighting <strong>of</strong> need variables........................69<br />
6.3 Further issues and views <strong>on</strong> outcomes...................................................70<br />
6.4 Revised regi<strong>on</strong>al outcomes <strong>of</strong> weighting for need variables......................70<br />
6.5 Comparis<strong>on</strong> with current <strong>RREF</strong>..............................................................71<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong><br />
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6.6 Detailed LGA scaled scores and need weightings ....................................72<br />
STEP 7: OUTCOMES FOR REGIONAL ALLOCATION OF GROWTH<br />
FUNDS................................................................................ 72<br />
7.1 Development <strong>of</strong> initial and revised <strong>RREF</strong> opti<strong>on</strong>s.....................................72<br />
7.2 Comparis<strong>on</strong> <strong>of</strong> c<strong>on</strong>tinuati<strong>on</strong> <strong>of</strong> current <strong>RREF</strong> and initial opti<strong>on</strong>s................74<br />
7.3 Opti<strong>on</strong>s for c<strong>on</strong>siderati<strong>on</strong> for resource allocati<strong>on</strong>s ...................................76<br />
7.4 Further issues and views <strong>on</strong> outcomes...................................................77<br />
7.5 Revised outcomes for regi<strong>on</strong>al resource allocati<strong>on</strong> ..................................78<br />
7.6 Assessment <strong>of</strong> Opti<strong>on</strong>s .........................................................................79<br />
PART D: ACHIEVING EQUITY IN THE HACC PROGRAM ........ 82<br />
REGIONAL AND LOCAL PLANNING FOR HACC .............................. 82<br />
FUNDING MEASURES COMPLEMENTARY TO THE <strong>RREF</strong>.................... 83<br />
RELATIONSHIOP OF GROWTH FUNDS TO HACC BASE FUNDS.......... 85<br />
FUTURE REVIEW AND ON-GOING DEVELOPMENT OF THE <strong>RREF</strong> ........ 86<br />
APPENDIX 1: INPUTS TO THE REVIEW PROCESS ..................... 88<br />
APPENDIX 1.1: The Review Reference Group .....................................................88<br />
APPENDIX 1.2: <strong>Department</strong>al Steering Committee ..............................................89<br />
APPENDIX 1.3: C<strong>on</strong>sultati<strong>on</strong> Schedules ...............................................................90<br />
APPENDIX 1.4: Submissi<strong>on</strong>s received.................................................................91<br />
APPENDIX 2: ABS DISABILITY, AGEING AND CARERS SURVEY..... 92<br />
Definiti<strong>on</strong>s and Frequently Asked Questi<strong>on</strong>s ........................................................92<br />
APPENDIX 3: LGA SCALED SCORES AND TOTAL WEIGHTINGS ON<br />
NEED VARIABLES ................................................................... 96<br />
REFERENCES......................................................................... 98<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong><br />
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ABBREVIATIONS AND NOTE ON TERMINOLOGY<br />
ABS<br />
AIHW<br />
AIP<br />
ARIA<br />
CACP<br />
CDA<br />
Australian Bureau <strong>of</strong> Statistics<br />
Australian Institute <strong>of</strong> <strong>Health</strong> and Welfare<br />
Approval in Principle<br />
Access/Remoteness Index for Australia<br />
Community Aged Care Package<br />
Child Disability Allowance<br />
DACS Disability, Ageing and Carers Survey, c<strong>on</strong>ducted by ABS (1998)<br />
DALY<br />
DHAC<br />
DHS<br />
DOI<br />
DSP<br />
DVA<br />
EACH<br />
FAQs<br />
HACC<br />
IRSED<br />
LGA<br />
MAV<br />
MHHY<br />
PACRAM<br />
PCA<br />
<strong>RREF</strong><br />
SEIFA<br />
SES<br />
Disability Adjusted Life Years<br />
<strong>Department</strong> <strong>of</strong> <strong>Health</strong> and Aged Care, Comm<strong>on</strong>wealth<br />
<strong>Department</strong> <strong>of</strong> Human Services, Victoria<br />
<strong>Department</strong> <strong>of</strong> Infrastructure, Victoria<br />
Disability Support Pensi<strong>on</strong><br />
<strong>Department</strong> <strong>of</strong> Veterans’ Affairs<br />
Extended Aged Care at Home (service package)<br />
Frequently Asked Questi<strong>on</strong>s, regarding Disability, Ageing and Carers<br />
Survey (Appendix 2)<br />
Home and Community Care Program<br />
Index <strong>of</strong> Relative Socio-Ec<strong>on</strong>omic Disadvantage<br />
Local Government Area<br />
Municipal Associati<strong>on</strong> <strong>of</strong> Victoria<br />
Median Household Income<br />
Post Acute Care Resource Allocati<strong>on</strong> Model<br />
Principal comp<strong>on</strong>ents analysis<br />
Relative Resource Equity Formula<br />
Socio-Ec<strong>on</strong>omic Indexes for Australia<br />
Socio-Ec<strong>on</strong>omic Status<br />
VHC Veterans’ Home Care Program commenced <strong>2001</strong>.<br />
YLD<br />
<strong>Health</strong>y Years <strong>of</strong> Life Lost to Disability<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong><br />
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Abbreviati<strong>on</strong>s and notes <strong>on</strong> Terminology<br />
The term Koori is used in this report for the indigenous populati<strong>on</strong> <strong>of</strong> Victoria, in line with<br />
Victorian Government policy. It was pointed out in the C<strong>on</strong>sultati<strong>on</strong>s that there are members <strong>of</strong><br />
other indigenous peoples living in Victoria, and this total indigenous populati<strong>on</strong> is covered in<br />
references to the Koori populati<strong>on</strong>. A pr<strong>of</strong>ile <strong>of</strong> the distributi<strong>on</strong> <strong>of</strong> the Koori populati<strong>on</strong> is given<br />
in Part B.<br />
The term handicap is used as a technical term to refer to levels <strong>of</strong> handicap as defined in the<br />
ABS Disability, Ageing and Carers Survey. Handicap is syn<strong>on</strong>ymous with core activity<br />
restricti<strong>on</strong>. For full definiti<strong>on</strong>s see Appendix 2.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong><br />
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ACKNOWLEDGEMENTS<br />
An exercise as extensive as this Review <strong>of</strong> the Relative Resource Equity Review in the HACC<br />
Program can <strong>on</strong>ly be undertaken with the cooperati<strong>on</strong> <strong>of</strong> many different organisati<strong>on</strong>s and<br />
individuals.<br />
The C<strong>on</strong>sultancy Team would like to acknowledge the c<strong>on</strong>tributi<strong>on</strong> <strong>of</strong> all those who participated<br />
in the c<strong>on</strong>sultati<strong>on</strong>s. Attending the c<strong>on</strong>sultati<strong>on</strong>s in all regi<strong>on</strong>s provided us with a first hand<br />
view <strong>of</strong> the diversity <strong>of</strong> needs to which HACC services have to resp<strong>on</strong>d and it was especially<br />
heartening to see the value that all participants placed <strong>on</strong> having a resource allocati<strong>on</strong> formula<br />
that was fair and transparent.<br />
Our appreciati<strong>on</strong> also goes to the members <strong>of</strong> the Reference Group who helped us distil the key<br />
issues for the Review, and our special thanks go to Ms Patricia Reeve who ably chaired the<br />
Reference Group.<br />
Our liais<strong>on</strong> with the provider and c<strong>on</strong>sumer groups involved in the HACC Program across the<br />
Victoria was facilitated by the efforts <strong>of</strong> staff <strong>of</strong> the <strong>Department</strong> <strong>of</strong> Human Services. The keen<br />
interest <strong>of</strong> <strong>of</strong>ficers <strong>of</strong> the Aged, Community and Mental <strong>Health</strong> Divisi<strong>on</strong>, particularly Jeannine<br />
Jacobs<strong>on</strong>, Alexandra Hurley, Jeremy Maddox and Carol Pyke, was evident throughout the<br />
Review. Working with these <strong>of</strong>ficers and staff from other Divisi<strong>on</strong>s and Regi<strong>on</strong>al Offices who<br />
were members <strong>of</strong> the <strong>Department</strong>al Steering Committee has made the <strong>RREF</strong> Review very much<br />
a joint venture.<br />
As leader <strong>of</strong> the C<strong>on</strong>sultancy c<strong>on</strong>sortium, I would like to thank my colleagues for their hard<br />
work and team spirit. I am sure that each member <strong>of</strong> the team would join in thanking the others<br />
for the particular c<strong>on</strong>tributi<strong>on</strong>s they made to the overall task:<br />
Liz Lowe and Ro Sax<strong>on</strong>, from HDG C<strong>on</strong>sulting Group, for the outstanding<br />
organisati<strong>on</strong>al and presentati<strong>on</strong> skills they brought to the C<strong>on</strong>sultati<strong>on</strong>s;<br />
Richard Rosewarne and Hugh Sarjeant, for the many hours <strong>of</strong> critical discussi<strong>on</strong><br />
and review <strong>of</strong> draft reports, as well as their high level analytic skills; and<br />
Diana Droog, for her smooth and efficient management <strong>of</strong> the C<strong>on</strong>sultancy from<br />
beginning to end.<br />
Discussi<strong>on</strong>s am<strong>on</strong>g the members <strong>of</strong> the c<strong>on</strong>sultancy team and with all those involved in the<br />
Review prompted a vast range <strong>of</strong> questi<strong>on</strong>s about the <strong>RREF</strong> and the HACC program more<br />
widely. We hope that the answers and opti<strong>on</strong>s that we have come up with, through c<strong>on</strong>sultati<strong>on</strong><br />
with the field, exhaustive analyses <strong>of</strong> data, and assessment <strong>of</strong> a variety <strong>of</strong> other background<br />
informati<strong>on</strong>, will advance the achievement <strong>of</strong> the goals <strong>of</strong> the HACC program in Victoria.<br />
Anna Howe<br />
May 11th, <strong>2001</strong><br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong><br />
iii
CONSULTANCY TEAM<br />
The <strong>Department</strong> <strong>of</strong> Human Services commissi<strong>on</strong>ed Cumpst<strong>on</strong> Sarjeant Pty Ltd. to undertake the<br />
c<strong>on</strong>sultancy for the <strong>RREF</strong> Review. The c<strong>on</strong>sultancy team was:<br />
Anna Howe, PhD, Independent C<strong>on</strong>sultant Ger<strong>on</strong>tologist<br />
Richard Rosewarne, PhD, Applied Aged Care Soluti<strong>on</strong>s Pty Ltd<br />
Hugh Sarjeant, C<strong>on</strong>sulting Actuary, Cumpst<strong>on</strong> Sarjeant Pty Ltd<br />
Diana Droog, Business Manager, Cumpst<strong>on</strong> Sarjeant Pty Ltd<br />
Liz Lowe, HDG C<strong>on</strong>sulting Group<br />
Ro Sax<strong>on</strong>, HDG C<strong>on</strong>sulting Group<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong><br />
iv
EXECUTIVE SUMMARY<br />
The Review <strong>of</strong> the Relative Resource Equity Formula for the HACC Program was announced<br />
by the Victorian Minister for Housing and Aged Care, the H<strong>on</strong>. Br<strong>on</strong>wyn Pike, in May 2000.<br />
The purpose <strong>of</strong> the Review was to examine the ways in which the formula c<strong>on</strong>tributed to the<br />
achievement <strong>of</strong> equity <strong>of</strong> resource allocati<strong>on</strong> in the HACC Program across the nine <strong>Department</strong><br />
<strong>of</strong> Human Services regi<strong>on</strong>s in Victoria.<br />
The <strong>RREF</strong> is the formula that has been used in the HACC program since 1992 to distribute<br />
annual growth funds and to bring about adjustments in base funding to achieve equitable<br />
funding for the target populati<strong>on</strong> in each regi<strong>on</strong>. The HACC target populati<strong>on</strong> has been defined<br />
by the Comm<strong>on</strong>wealth and States <strong>on</strong> the basis <strong>of</strong> the populati<strong>on</strong> with moderate, severe and<br />
pr<strong>of</strong>ound levels <strong>of</strong> core activity restricti<strong>on</strong>, as measured in the most recent Disability, Ageing<br />
and Carers Survey c<strong>on</strong>ducted by the by the Australian Bureau <strong>of</strong> Statistics in 1998. To date, the<br />
<strong>on</strong>ly other need factor for HACC services recognised in the <strong>RREF</strong> has been for rurality. This<br />
failure to take account <strong>of</strong> the range <strong>of</strong> other factors potentially affecting the need for HACC<br />
services was seen as limiting the effectiveness <strong>of</strong> the <strong>RREF</strong> as a mechanism for equitable<br />
resource allocati<strong>on</strong>.<br />
The Review process involved investigati<strong>on</strong> <strong>of</strong> a range <strong>of</strong> policy and program material and<br />
background literature, extensive analysis <strong>of</strong> statistical data and modelling, and preparati<strong>on</strong> <strong>of</strong> a<br />
C<strong>on</strong>sultati<strong>on</strong> Paper and Opti<strong>on</strong>s Paper to provide background informati<strong>on</strong> for two rounds <strong>of</strong><br />
c<strong>on</strong>sultati<strong>on</strong>s. C<strong>on</strong>sultati<strong>on</strong> sessi<strong>on</strong>s were held in all nine regi<strong>on</strong>s across the state, and<br />
additi<strong>on</strong>al c<strong>on</strong>sultati<strong>on</strong>s were held with Koori groups. Some 200 participants attended each<br />
round <strong>of</strong> c<strong>on</strong>sultati<strong>on</strong>s, representing HACC provider and c<strong>on</strong>sumer organisati<strong>on</strong>s. Issues raised<br />
in each round were taken into account in subsequent stages <strong>of</strong> the Review.<br />
The c<strong>on</strong>sultati<strong>on</strong>s identified a wide range <strong>of</strong> shortcomings with the current <strong>RREF</strong> and critical<br />
areas for attenti<strong>on</strong>. There was str<strong>on</strong>g support for revisi<strong>on</strong> <strong>of</strong> the <strong>RREF</strong> and the sec<strong>on</strong>d round <strong>of</strong><br />
c<strong>on</strong>sultati<strong>on</strong>s canvassed opti<strong>on</strong>s for the five main elements <strong>of</strong> the <strong>RREF</strong> - the base populati<strong>on</strong>;<br />
the need variables to be included; and the scaling, weighting and number <strong>of</strong> variables.<br />
Outcomes <strong>of</strong> revised <strong>RREF</strong> models were presented in terms <strong>of</strong> regi<strong>on</strong>al shares <strong>of</strong> growth funds<br />
and preferences am<strong>on</strong>g the range <strong>of</strong> opti<strong>on</strong>s for the elements <strong>of</strong> the <strong>RREF</strong> were assessed. The<br />
opti<strong>on</strong>s put forward for revisi<strong>on</strong> <strong>of</strong> the <strong>RREF</strong> were seen to have addressed the major limitati<strong>on</strong>s<br />
<strong>of</strong> the current formula. The initial outcomes reported in the Opti<strong>on</strong>s Paper have been revised to<br />
take account <strong>of</strong> the rating <strong>of</strong> opti<strong>on</strong>s and other issues identified in the sec<strong>on</strong>d round <strong>of</strong><br />
c<strong>on</strong>sultati<strong>on</strong>s and a new set <strong>of</strong> revised outcomes are presented in this <str<strong>on</strong>g>Report</str<strong>on</strong>g>. The revisi<strong>on</strong>s to<br />
the <strong>RREF</strong> were widely accepted as providing a more equitable mechanism for resource<br />
allocati<strong>on</strong>, and recogniti<strong>on</strong> <strong>of</strong> this improvement is a key c<strong>on</strong>siderati<strong>on</strong> in adopting a revised<br />
<strong>RREF</strong>.<br />
The shares <strong>of</strong> growth funds allocated to regi<strong>on</strong>s under the revised models show <strong>on</strong>ly relatively<br />
small shifts from the shares that would be received under c<strong>on</strong>tinuati<strong>on</strong> <strong>of</strong> the current <strong>RREF</strong>.<br />
The opti<strong>on</strong>s for a revised <strong>RREF</strong> have been built up from data at Local Government Area level,<br />
and the analysis <strong>of</strong> these data has shown that the degree <strong>of</strong> variati<strong>on</strong> in need between LGAs in<br />
each regi<strong>on</strong> is at least as great as differences in average need levels between regi<strong>on</strong>s. As the<br />
<strong>RREF</strong> <strong>on</strong>ly allocates resources at the inter-regi<strong>on</strong>al level, addressing these marked variati<strong>on</strong>s in<br />
need within regi<strong>on</strong>s is identified as a priority for regi<strong>on</strong>al and local planning. The relati<strong>on</strong>ship<br />
between regi<strong>on</strong>al shares <strong>of</strong> growth funds and base funds was also raised in the c<strong>on</strong>text <strong>of</strong> any<br />
new <strong>RREF</strong>. The current <strong>RREF</strong> includes provisi<strong>on</strong> for identificati<strong>on</strong> <strong>of</strong> separate funding for an<br />
equity adjustment to base funding and this opti<strong>on</strong> remains in any revised <strong>RREF</strong>.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong><br />
v
Executive Summary<br />
The <strong>RREF</strong> is recognised as <strong>on</strong>e <strong>of</strong> several measures through which equity in the HACC<br />
Program is pursued. The c<strong>on</strong>sultati<strong>on</strong>s raised a number <strong>of</strong> wider issues that have an impact <strong>on</strong><br />
equity <strong>of</strong> outcomes in service delivery and which need to be addressed in c<strong>on</strong>juncti<strong>on</strong> with<br />
implementati<strong>on</strong> <strong>of</strong> a revised <strong>RREF</strong>.<br />
This <str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> draws together material from the C<strong>on</strong>sultati<strong>on</strong> Paper and Opti<strong>on</strong>s paper,<br />
together with reports <strong>on</strong> the C<strong>on</strong>sultati<strong>on</strong>s and a range <strong>of</strong> other material, and incorporates the<br />
modelling <strong>of</strong> revised outcomes. The structure <strong>of</strong> the <str<strong>on</strong>g>Report</str<strong>on</strong>g> follows the processes <strong>of</strong> the<br />
Review:<br />
Part A sets out the scope and background to the Review<br />
Part B covers the development <strong>of</strong> opti<strong>on</strong>s for the <strong>RREF</strong> in four steps:<br />
Step 1: Opti<strong>on</strong>s for definiti<strong>on</strong> <strong>of</strong> the base populati<strong>on</strong><br />
Step 2: Opti<strong>on</strong>s for variables for weighting the <strong>RREF</strong> to take account <strong>of</strong> need<br />
Step 3: Opti<strong>on</strong>s for scaling <strong>of</strong> variables<br />
Step 4: Opti<strong>on</strong>s for adjusting the weighting <strong>of</strong> need variables.<br />
Part C reports the outcomes <strong>of</strong> modelling the opti<strong>on</strong>s for the <strong>RREF</strong> in three steps:<br />
Step 5: Outcomes for base populati<strong>on</strong>s<br />
Step 6: Regi<strong>on</strong>al outcomes <strong>of</strong> weighting for need variables<br />
Step 7: Outcomes for regi<strong>on</strong>al allocati<strong>on</strong> <strong>of</strong> growth funds<br />
Part D takes up a range <strong>of</strong> other issues that have a bearing <strong>on</strong> the achievement <strong>of</strong> equity<br />
in HACC through the <strong>RREF</strong> and identifies opti<strong>on</strong>s for inclusi<strong>on</strong> in the strategy<br />
for implementati<strong>on</strong> <strong>of</strong> any revised <strong>RREF</strong>.<br />
The Terms <strong>of</strong> Reference provide a framework for summarising the<br />
c<strong>on</strong>clusi<strong>on</strong>s <strong>of</strong> the Review:<br />
1. The objectives <strong>of</strong> the HACC program<br />
As set out in the current HACC Agreement, the objective <strong>of</strong> the HACC program <strong>of</strong> central<br />
relevance to the review <strong>of</strong> the <strong>RREF</strong> is that the program should “ensure that, within available<br />
resources and within the broader service network, services are provided equitably between<br />
regi<strong>on</strong>s, resp<strong>on</strong>sive to the regi<strong>on</strong>al differences and targeted to those who would benefit most<br />
and/or are most in need <strong>of</strong> these services”. The Victorian Government is committed to the<br />
objectives <strong>of</strong> the HACC Program and its c<strong>on</strong>tinued growth and has made significant<br />
c<strong>on</strong>tributi<strong>on</strong>s <strong>of</strong> State <strong>on</strong>ly funds which are yet to be matched by the Comm<strong>on</strong>wealth. The way<br />
in which the current <strong>RREF</strong> works and the progress towards achieving equity in resource<br />
allocati<strong>on</strong> that has been achieved to date are reviewed in Part A <strong>of</strong> this <str<strong>on</strong>g>Report</str<strong>on</strong>g>.<br />
Against this equity objective, the main shortcoming <strong>of</strong> the current <strong>RREF</strong> was seen to be its<br />
failure to take account <strong>of</strong> the range <strong>of</strong> factors that affect need for HACC services, and that the<br />
resultant allocati<strong>on</strong> <strong>of</strong> resources fails to resp<strong>on</strong>d to regi<strong>on</strong>al needs. The development <strong>of</strong> a<br />
revised <strong>RREF</strong> that included a base populati<strong>on</strong> that better reflected the target populati<strong>on</strong> and a<br />
range <strong>of</strong> need variables was str<strong>on</strong>gly supported in the c<strong>on</strong>sultati<strong>on</strong>s and the opti<strong>on</strong>s<br />
subsequently put forward were widely accepted as providing a more equitable basis for<br />
allocati<strong>on</strong> <strong>of</strong> resources. The outcomes for regi<strong>on</strong>al resource allocati<strong>on</strong>s were seen to resp<strong>on</strong>d to<br />
differences in relative need, notwithstanding the limits <strong>of</strong> the absolute level <strong>of</strong> resources<br />
available to the program. While opti<strong>on</strong>s that favoured their regi<strong>on</strong> were obviously preferred by<br />
participants in the sec<strong>on</strong>d round <strong>of</strong> c<strong>on</strong>sultati<strong>on</strong>s, there was ready acknowledgement <strong>of</strong> the<br />
wider principle <strong>of</strong> equity and that the <strong>RREF</strong> should express this principle.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong><br />
vi
Executive Summary<br />
All regi<strong>on</strong>s will c<strong>on</strong>tinue to receive growth funds under a revised <strong>RREF</strong> and reallocati<strong>on</strong>s<br />
between regi<strong>on</strong>s compared to outcomes under c<strong>on</strong>tinuati<strong>on</strong> <strong>of</strong> the current <strong>RREF</strong> are relatively<br />
minor. Further, modelling <strong>of</strong> reallocati<strong>on</strong>s showed a mixed pattern across rural and<br />
metropolitan regi<strong>on</strong>s rather than a simple rural-metropolitan divide.<br />
The much larger populati<strong>on</strong>s <strong>of</strong> the metropolitan regi<strong>on</strong>s meant that most reallocati<strong>on</strong> was<br />
between the metropolitan regi<strong>on</strong>s. Outcomes for rural regi<strong>on</strong>s generally resulted in lower levels<br />
<strong>of</strong> growth funding, in part reflecting populati<strong>on</strong> trends. It was also argued that the allocati<strong>on</strong> <strong>of</strong><br />
resources through the <strong>RREF</strong> al<strong>on</strong>e failed to take account <strong>of</strong> factors that increased the cost <strong>of</strong><br />
service delivery in rural areas and that higher performance targets associated with <strong>RREF</strong><br />
allocati<strong>on</strong>s could impose additi<strong>on</strong>al burdens <strong>on</strong> rural regi<strong>on</strong>s. Supplementary measures that<br />
could recognise these rural cost factors are taken up under Term <strong>of</strong> Reference 5 below.<br />
Adopti<strong>on</strong> <strong>of</strong> a revised <strong>RREF</strong> would change the level <strong>of</strong> per capita funding that defined equity<br />
and so redraw the equity line for the base funding that each regi<strong>on</strong> received. Recognising that<br />
reallocati<strong>on</strong> <strong>of</strong> growth funds would bring about adjustments in the base funding <strong>on</strong>ly very<br />
slowly, the relati<strong>on</strong>ship between growth funding and base funding was raised in the Round 2<br />
C<strong>on</strong>sultati<strong>on</strong>s.<br />
2. The nati<strong>on</strong>al c<strong>on</strong>text for resource allocati<strong>on</strong> in aged care and<br />
Comm<strong>on</strong>wealth planning processes<br />
The <strong>RREF</strong> Review has been undertaken in the c<strong>on</strong>text <strong>of</strong> c<strong>on</strong>tinuing debate about the<br />
Comm<strong>on</strong>wealth strategy for equalisati<strong>on</strong> <strong>of</strong> HACC funding per capita <strong>of</strong> the target populati<strong>on</strong>.<br />
The Review has identified a number <strong>of</strong> issues that the Victorian Government needs to take up<br />
with other States and the Comm<strong>on</strong>wealth, including:<br />
• The opti<strong>on</strong>s developed for operati<strong>on</strong>alising the definiti<strong>on</strong> <strong>of</strong> the HACC target<br />
populati<strong>on</strong>;<br />
• The c<strong>on</strong>tributi<strong>on</strong> <strong>of</strong> the <strong>RREF</strong> Review to the development <strong>of</strong> resource allocati<strong>on</strong><br />
formulas in other states with a view to maintaining nati<strong>on</strong>al c<strong>on</strong>sistency; and<br />
• The need for c<strong>on</strong>tinuing liais<strong>on</strong> with the ABS with regard to optimising the value <strong>of</strong><br />
the next Survey <strong>of</strong> Disability, Ageing and Carers for the HACC program and related<br />
programs.<br />
3. The basis <strong>on</strong> which the target populati<strong>on</strong> for HACC services is<br />
measured<br />
Step 1 in developing opti<strong>on</strong>s for a revised <strong>RREF</strong> focused <strong>on</strong> alternative approaches to defining<br />
the HACC target populati<strong>on</strong> and these issues and the opti<strong>on</strong>s that emerged are presented in Part<br />
B: Step 1 <strong>of</strong> this <str<strong>on</strong>g>Report</str<strong>on</strong>g>.<br />
The main basis for the definiti<strong>on</strong> <strong>of</strong> the target populati<strong>on</strong> as adopted in HACC nati<strong>on</strong>ally is the<br />
populati<strong>on</strong> identified as having moderate, severe or pr<strong>of</strong>ound activity restricti<strong>on</strong>s in the 1998<br />
ABS Survey <strong>of</strong> Disability, Ageing and Carers. The Review addressed a number <strong>of</strong> c<strong>on</strong>cerns<br />
expressed in the field about this data and noted several strengths <strong>of</strong> the DAC survey that make it<br />
the most appropriate base for measuring the HACC target populati<strong>on</strong>.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong><br />
vii
Executive Summary<br />
The adjustment for the frail aged in the current <strong>RREF</strong> was seen to be inadequate and two<br />
opti<strong>on</strong>s were proposed involving (1) inclusi<strong>on</strong> <strong>of</strong> the total populati<strong>on</strong> aged 70 and over living in<br />
the community and (2) doubling the 70+ populati<strong>on</strong> with core activity restricti<strong>on</strong>s. Opti<strong>on</strong>s for<br />
other adjustment in the base populati<strong>on</strong> were proposed in relati<strong>on</strong> to exclusi<strong>on</strong> <strong>of</strong> the populati<strong>on</strong><br />
in residential aged care and disability accommodati<strong>on</strong>.<br />
There was c<strong>on</strong>siderable debate as to how the veteran populati<strong>on</strong> eligible for the new DVA<br />
Veterans’ Home Care Program should be treated. While a number <strong>of</strong> practical issues were<br />
raised about the early implementati<strong>on</strong> <strong>of</strong> the VHC Program, the level <strong>of</strong> additi<strong>on</strong>al resources<br />
provided through the program is close to the level <strong>of</strong> growth funds and hence <strong>of</strong> c<strong>on</strong>siderable<br />
relevance to the functi<strong>on</strong> <strong>of</strong> the <strong>RREF</strong> as a resource allocati<strong>on</strong> tool. Accordingly, the veteran<br />
populati<strong>on</strong> eligible for the VHC was discounted <strong>on</strong> the basis <strong>of</strong> an alternative source <strong>of</strong> funding<br />
being available.<br />
4. The factors which should be taken into account to achieve equity<br />
across Victorian Regi<strong>on</strong>s in the distributi<strong>on</strong> <strong>of</strong> HACC resources and the<br />
methodology which should be used to apply those factors<br />
The main shortcoming <strong>of</strong> the <strong>RREF</strong> was seen to be the lack <strong>of</strong> attenti<strong>on</strong> to variables affecting<br />
need for HACC services, and a wide array <strong>of</strong> need factors were proposed in the c<strong>on</strong>sultati<strong>on</strong>s.<br />
Assessment <strong>of</strong> these variables for inclusi<strong>on</strong> in the <strong>RREF</strong> is presented in Part B: Step 2 <strong>of</strong> this<br />
<str<strong>on</strong>g>Report</str<strong>on</strong>g>. Pr<strong>of</strong>iles <strong>of</strong> the five variables selected as need indicators are presented at the end <strong>of</strong> Part<br />
B. All <strong>of</strong> the 29 variables identified in the c<strong>on</strong>sultati<strong>on</strong>s were assessed; seven have been taken<br />
into account in defining the base populati<strong>on</strong> and five are proposed as need variables for<br />
weighting the <strong>RREF</strong>, with the remaining variables being set aside as being duplicative or <strong>on</strong><br />
other grounds such as lack <strong>of</strong> reliable data. The five variables preferred as indicators <strong>of</strong> need for<br />
HACC services are:<br />
1. Socio-ec<strong>on</strong>omic status: median household income<br />
2. <strong>Health</strong> status indicator: healthy years <strong>of</strong> life lost to disability<br />
3. Cultural diversity: populati<strong>on</strong> speaking a language other than English at home<br />
4. Koori populati<strong>on</strong><br />
5. Rurality: Accessibility/Remoteness Index for Australia (ARIA)<br />
Replacement <strong>of</strong> the variable initially c<strong>on</strong>sidered for health status - life expectancy - with the<br />
measure <strong>of</strong> healthy years <strong>of</strong> life lost to disability was informed by the DHS Burden <strong>of</strong> Disease<br />
study and is significant as potentially the first applicati<strong>on</strong> <strong>of</strong> the results <strong>of</strong> this study in service<br />
planning. There was also extensive discussi<strong>on</strong> <strong>of</strong> the impact <strong>of</strong> the shortfall <strong>of</strong> Comm<strong>on</strong>wealth<br />
funded residential care places <strong>on</strong> HACC, and how this impact might be recognised in the <strong>RREF</strong>.<br />
The decisi<strong>on</strong> to exclude this variable was made <strong>on</strong> resource grounds, c<strong>on</strong>sistent with the<br />
decisi<strong>on</strong> <strong>on</strong> veterans eligible for VHC, namely that Comm<strong>on</strong>wealth funding for the residential<br />
care program should cover the shortfall rather than HACC.<br />
All data <strong>on</strong> the base populati<strong>on</strong> and need variables were assembled at the LGA level and<br />
regi<strong>on</strong>al models built up from the local level. Detailed c<strong>on</strong>siderati<strong>on</strong> was given to whether any<br />
<strong>of</strong> the need variables should be given additi<strong>on</strong>al weighting and to the number <strong>of</strong> variables to be<br />
included in a revised <strong>RREF</strong>. A wide range <strong>of</strong> opti<strong>on</strong>s was initially modelled and revised models<br />
developed with all five <strong>of</strong> the need variables are seen to capture the main dimensi<strong>on</strong>s <strong>of</strong> need in<br />
a formula that retained a high degree <strong>of</strong> transparency. With regard to weighting, the need<br />
variables make different c<strong>on</strong>tributi<strong>on</strong>s to the overall need weighting, reflecting their distributi<strong>on</strong><br />
across LGAs, but in order to dem<strong>on</strong>strate the impact <strong>of</strong> adjusting the weighting <strong>of</strong> different<br />
variables, opti<strong>on</strong>s were modelled with double weighting <strong>of</strong> selected variables. The outcome <strong>of</strong><br />
this adjustment was to increase the effect <strong>of</strong> the selected variables.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong><br />
viii
Executive Summary<br />
Bey<strong>on</strong>d the detailed c<strong>on</strong>siderati<strong>on</strong> that was given to how the Koori populati<strong>on</strong> should be scaled<br />
as a need variable, it was recognised that including the Koori populati<strong>on</strong> as a need variable in<br />
the <strong>RREF</strong> did not guarantee that the goal <strong>of</strong> better access or more appropriate services would<br />
automatically result, and that other complementary strategies would be required by way <strong>of</strong><br />
c<strong>on</strong>tinuing Service Development Grants.<br />
The particular problems faced by agencies serving Koori populati<strong>on</strong>s included the need to<br />
operate across LGA and even regi<strong>on</strong>al boundaries in some cases. Similarly, recogniti<strong>on</strong> <strong>of</strong><br />
cultural and linguistic diversity as a need variable in the <strong>RREF</strong> could add to the level <strong>of</strong><br />
resources allocated to regi<strong>on</strong>s with large numbers in these populati<strong>on</strong>s, but did not address the<br />
nature <strong>of</strong> services required or the additi<strong>on</strong>al costs <strong>of</strong> service delivery associated with use <strong>of</strong><br />
interpreter services. Again, Service Development Grants were seen as a means <strong>of</strong> addressing<br />
these issues.<br />
5. The most effective approach to recognising the needs <strong>of</strong> rural LGAs<br />
The needs <strong>of</strong> rural areas were raised at all stages <strong>of</strong> the Review and are c<strong>on</strong>sidered throughout<br />
the <str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g>.<br />
Under the opti<strong>on</strong>s developed for a revised <strong>RREF</strong>, with all LGAs weighted <strong>on</strong> the same need<br />
variables, need weightings show a wide range <strong>of</strong> need across both rural and metropolitan LGAs<br />
rather than a simple rural-urban divide. While rural regi<strong>on</strong>s still achieved weightings <strong>of</strong> at least<br />
30%, the relativity <strong>of</strong> these weightings has changed as metropolitan regi<strong>on</strong>s also receive need<br />
weightings. The need weightings apply to <strong>on</strong>ly small populati<strong>on</strong>s in some rural LGAs and other<br />
populati<strong>on</strong> trends also affect the outcomes <strong>of</strong> the <strong>RREF</strong>.<br />
At an early stage in the Review, it was widely argued that other measures needed to be taken to<br />
address the higher costs <strong>of</strong> service delivery in rural areas as performance targets attached to<br />
current <strong>RREF</strong> allocati<strong>on</strong>s failed to do so, and rather increased the performance targets that had<br />
to be reached. The detailed analysis <strong>of</strong> need factors across all regi<strong>on</strong>s has provided a sounder<br />
basis for need weightings in the <strong>RREF</strong>, and any revisi<strong>on</strong> <strong>of</strong> the unit cost structure in HACC and<br />
development <strong>of</strong> related pricing mechanisms needs to be informed by a similarly detailed<br />
investigati<strong>on</strong> <strong>of</strong> the factors c<strong>on</strong>tributing to cost variati<strong>on</strong>s, and the extent <strong>of</strong> those variati<strong>on</strong>s<br />
across all LGAs.<br />
Within rural areas differences between the cost <strong>of</strong> serving clients living in major rural centres<br />
and towns compared to those who were more distant were recognised, and<br />
mechanismsaddressing the cost <strong>of</strong> travel in rural areas need to be specifically targeted to these<br />
“distant” clients. The need for any measures taken to address rural needs in HACC to be<br />
c<strong>on</strong>sistent with approaches to rural services taken in other DHS programs was also emphasised.<br />
Uneven access to services that were funded <strong>on</strong> a regi<strong>on</strong>-wide basis also need to be addressed<br />
through planning measures as well as through resource allocati<strong>on</strong>.<br />
6. The impact <strong>of</strong> capacity to raise fees <strong>on</strong> regi<strong>on</strong>al resource allocati<strong>on</strong><br />
There was unanimous agreement from the beginning <strong>of</strong> the Review that the <strong>RREF</strong> should not<br />
attempt to take direct account <strong>of</strong> capacity to raise fees for HACC services. Rather, it was<br />
c<strong>on</strong>sidered that this factor should be dealt with indirectly through inclusi<strong>on</strong> <strong>of</strong> a socio-ec<strong>on</strong>omic<br />
status variable in the <strong>RREF</strong>.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong><br />
ix
Executive Summary<br />
While a number <strong>of</strong> opti<strong>on</strong>s were c<strong>on</strong>sidered, including variables based <strong>on</strong> take-up <strong>of</strong> age and<br />
disability support pensi<strong>on</strong>s; median household income was identified as the most appropriate<br />
and robust variable. This socio-ec<strong>on</strong>omic status variable makes the greatest c<strong>on</strong>tributi<strong>on</strong> to<br />
need weighting in the <strong>RREF</strong> model, and remains dominant even in models which make<br />
adjustments to the weightings <strong>of</strong> other variables. Notwithstanding the close relati<strong>on</strong>ship<br />
between socio-ec<strong>on</strong>omic status and health status, it was c<strong>on</strong>sidered more appropriate to include<br />
separate variables to capture the somewhat different nature <strong>of</strong> these two dimensi<strong>on</strong>s <strong>of</strong> need<br />
than to give added weight to the socio-ec<strong>on</strong>omic variable and exclude the health status variable.<br />
7. The basis <strong>on</strong> which judgements should be made in allocating<br />
resources between LGAs within regi<strong>on</strong>s; and<br />
8. The relati<strong>on</strong>ship to local area planning and needs analysis<br />
These Terms <strong>of</strong> Reference both relate to planning and allocati<strong>on</strong> <strong>of</strong> the resources that the <strong>RREF</strong><br />
allocates <strong>on</strong> a regi<strong>on</strong>al level. There was a widespread view that more c<strong>on</strong>sistent and systematic<br />
approaches to resource allocati<strong>on</strong> and service development across all DHS regi<strong>on</strong>s was needed<br />
to achieve equity within regi<strong>on</strong>s. While planning approaches that were seen to be effective in<br />
some regi<strong>on</strong>s may have wider applicability, it also has to be recognised that each regi<strong>on</strong> faces a<br />
different pattern <strong>of</strong> need and a different c<strong>on</strong>figurati<strong>on</strong> <strong>of</strong> existing services. The field was aware<br />
that DHS is currently addressing issues <strong>of</strong> regi<strong>on</strong>al and local planning in HACC, and there was<br />
str<strong>on</strong>g support for progressing HACC planning in c<strong>on</strong>juncti<strong>on</strong> with implementati<strong>on</strong> <strong>of</strong> a revised<br />
<strong>RREF</strong>.<br />
The analysis <strong>of</strong> need variables carried out in the Review provided c<strong>on</strong>siderable insight into the<br />
level and nature <strong>of</strong> variati<strong>on</strong>s in total need weightings for LGAs within any <strong>on</strong>e regi<strong>on</strong>. This<br />
LGA level data was <strong>of</strong> c<strong>on</strong>siderable interest to the field and access to this type <strong>of</strong> data was seen<br />
to have a very useful c<strong>on</strong>tributi<strong>on</strong> to make to regi<strong>on</strong>al planning. At the same time, these data<br />
did not provide a basis for allocating resources to a local level within regi<strong>on</strong>s, but needed to be<br />
complemented with a range <strong>of</strong> other service provisi<strong>on</strong> data and local knowledge. The lack <strong>of</strong><br />
c<strong>on</strong>sistent data <strong>on</strong> service provisi<strong>on</strong> at local and regi<strong>on</strong>al level was recognised and the HACC<br />
Minimum Data Set was seen as the means for addressing this problem. Primary Care<br />
Partnerships and the Memorandum <strong>of</strong> Understanding between DHS and the Municipal<br />
Associati<strong>on</strong> <strong>of</strong> Victoria provide vehicles for exchange <strong>of</strong> informati<strong>on</strong> and discussi<strong>on</strong> at subregi<strong>on</strong>al<br />
and local level, and issues such as uneven access to Work to this end is currently<br />
underway in DHS.<br />
In c<strong>on</strong>sidering approaches to planning and resource allocati<strong>on</strong> at the regi<strong>on</strong>al and local level, it<br />
is important to remember that the annual growth funds <strong>on</strong>ly add marginally to existing<br />
resources. As by far the major part <strong>of</strong> resources are bound up in existing services, planning and<br />
service development needs to give at least as much attenti<strong>on</strong> to existing services as to new<br />
service development and to use growth funds as a catalyst to adjusting existing services to<br />
resp<strong>on</strong>d to changing needs.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong><br />
x
Executive Summary<br />
9. The planning and resource allocati<strong>on</strong> methodologies used by<br />
community support programs which delivery similar services to HACC<br />
in Victoria;<br />
10. The DHS Aged Community and Mental <strong>Health</strong> Divisi<strong>on</strong>’s funding<br />
reform project; and<br />
11. Methodologies used for these purposes in other states<br />
These Terms <strong>of</strong> Reference can be c<strong>on</strong>sidered together. An analysis was made <strong>of</strong> a number <strong>of</strong><br />
other resource allocati<strong>on</strong> formula used in Victoria and the variables included and methods <strong>of</strong><br />
c<strong>on</strong>structi<strong>on</strong> were taken into account in developing opti<strong>on</strong>s for the <strong>RREF</strong>. The major<br />
c<strong>on</strong>siderati<strong>on</strong> in relati<strong>on</strong> to other programs is not so much the difference between resource<br />
allocati<strong>on</strong> formulas, but between major programs for which resources are allocated <strong>on</strong> the basis<br />
<strong>of</strong> a known formula and small programs in which resources appear to be allocated without the<br />
benefit <strong>of</strong> a formula. The processes <strong>of</strong> the <strong>RREF</strong> Review and acceptance <strong>of</strong> a revised <strong>RREF</strong><br />
should inform discussi<strong>on</strong> about more systematic resource allocati<strong>on</strong> and planning in such<br />
programs in the c<strong>on</strong>text <strong>of</strong> the funding reform project underway in Aged, Community and<br />
Mental <strong>Health</strong> Divisi<strong>on</strong> in DHS.<br />
No other states were found to have a developed mechanism for allocating HACC resources and<br />
it is rather the review <strong>of</strong> the <strong>RREF</strong> that has attracted interstate and Comm<strong>on</strong>wealth attenti<strong>on</strong>.<br />
The operati<strong>on</strong> <strong>of</strong> the high care pool by the NSW Home Care Service was canvassed and some<br />
interest expressed in a similar opti<strong>on</strong> for Victoria but any such opti<strong>on</strong> will be more appropriately<br />
pursued through HACC assessment and targeting strategies.<br />
In c<strong>on</strong>clusi<strong>on</strong>, the purpose <strong>of</strong> this <str<strong>on</strong>g>Report</str<strong>on</strong>g> is to present a number <strong>of</strong> opti<strong>on</strong>s and preferences<br />
identified in the c<strong>on</strong>sultati<strong>on</strong>s and provide a basis <strong>on</strong> which the Minister for Housing and Aged<br />
Care can make an informed decisi<strong>on</strong> <strong>on</strong> the mechanism for regi<strong>on</strong>al resource allocati<strong>on</strong> in the<br />
HACC Program in Victoria, in the c<strong>on</strong>text <strong>of</strong> relevant budget and policy developments.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong><br />
xi
Summary <strong>of</strong> Opti<strong>on</strong>s for a revised <strong>RREF</strong><br />
Step 1:<br />
Base Populati<strong>on</strong><br />
Opti<strong>on</strong>s<br />
Step 2:<br />
Need Variables<br />
Step 3:<br />
Scaling <strong>of</strong> Variables<br />
Step 4:<br />
Weighting <strong>of</strong><br />
Variables<br />
Outcomes<br />
Step 5:<br />
Base Populati<strong>on</strong>s<br />
Step 6:<br />
Regi<strong>on</strong>al Outcomes <strong>of</strong><br />
Weighting for Need<br />
Variables<br />
Step 7:<br />
Regi<strong>on</strong>al Allocati<strong>on</strong> <strong>of</strong><br />
Growth Funds<br />
Implementati<strong>on</strong><br />
Opti<strong>on</strong>s<br />
Round One C<strong>on</strong>sultati<strong>on</strong>s<br />
3 opti<strong>on</strong>s prepared with<br />
different adjustments for the<br />
frail aged and the same<br />
adjustments for other<br />
elements<br />
28 variables identified and<br />
assessed<br />
7 taken into account in<br />
development <strong>of</strong> base<br />
populati<strong>on</strong><br />
5 to be included in revised<br />
<strong>RREF</strong><br />
All variables scaled 0-9 <strong>on</strong><br />
basis <strong>of</strong> decile distributi<strong>on</strong> <strong>of</strong><br />
values for each variable<br />
across all 78 LGAs<br />
Variables made differing<br />
c<strong>on</strong>tributi<strong>on</strong>s to model,<br />
reflecting distributi<strong>on</strong> <strong>of</strong><br />
scores across LGAs<br />
Models with and without<br />
adjustments to weightings<br />
4 and 6 variable opti<strong>on</strong>s<br />
initially developed<br />
Initial outcomes reported in<br />
Opti<strong>on</strong>s Paper prepared for<br />
basis <strong>of</strong> Round 2<br />
C<strong>on</strong>sultati<strong>on</strong>s<br />
Range <strong>of</strong> issues raised in<br />
c<strong>on</strong>sultati<strong>on</strong>s<br />
Round Two C<strong>on</strong>sultati<strong>on</strong>s<br />
Revised models developed for two base<br />
populati<strong>on</strong>s:<br />
! Base 2: includes total populati<strong>on</strong> aged 70+,<br />
living in the community<br />
! Base 3: double weighting to the populati<strong>on</strong><br />
aged 70+, with core activity restricti<strong>on</strong>s<br />
5 need indicators<br />
! Socio-ec<strong>on</strong>omic status: median household<br />
income<br />
! <strong>Health</strong> status indicator: healthy years <strong>of</strong> life<br />
lost to disability<br />
! Cultural diversity: populati<strong>on</strong> speaking a<br />
language other than English at home<br />
! Koori populati<strong>on</strong><br />
! Rurality: Accessibility/Remoteness Index for<br />
Australia (ARIA)<br />
Scaling 0-9, with 0 representing low need and 9<br />
representing high need<br />
Revised models prepared with and without<br />
adjustments to weightings<br />
5 variable model seen as including sufficient<br />
range <strong>of</strong> variables and maintaining transparency<br />
Revised Outcomes presented in <str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g><br />
Implementati<strong>on</strong> strategy for revised <strong>RREF</strong> also<br />
needs to give attenti<strong>on</strong> to:<br />
! costs <strong>of</strong> delivery <strong>of</strong> services to distant<br />
clients in rural regi<strong>on</strong>s;<br />
! c<strong>on</strong>tinuing service development grants to<br />
address special needs <strong>of</strong> the Koori<br />
populati<strong>on</strong> and cultural and linguistic<br />
diversity;<br />
! Enhanced c<strong>on</strong>sistency in regi<strong>on</strong>al<br />
planning arrangements, and improved<br />
access to data at LGA level<br />
! C<strong>on</strong>tinuing investigati<strong>on</strong> <strong>of</strong> critical issues<br />
for the HACC program,<br />
! Remaining inequities in base funds; and<br />
! Future updating and review <strong>of</strong> a revised<br />
<strong>RREF</strong><br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong><br />
xii
PART A: BACKGROUND AND SCOPE OF THE <strong>RREF</strong><br />
REVIEW<br />
SCOPE OF THE REVIEW<br />
Terms <strong>of</strong> Reference<br />
The purpose <strong>of</strong> the Review <strong>of</strong> the Relative Resource Equity Formula, or <strong>RREF</strong>, used in the<br />
Home and Community Care Program in Victoria is to provide advice to Victoria’s Minister for<br />
Housing and Aged Care <strong>on</strong> opti<strong>on</strong>s for improving the <strong>RREF</strong> as the means for distributing<br />
HACC growth funds to the nine <strong>Department</strong> <strong>of</strong> Human Services regi<strong>on</strong>s. The <strong>RREF</strong> is the<br />
resource allocati<strong>on</strong> formula used to ensure that, over time, funds in the HACC Program are<br />
distributed equitably across the nine regi<strong>on</strong>s in the State.<br />
The Terms <strong>of</strong> Reference <strong>of</strong> the Review are to take account <strong>of</strong>:<br />
1. The objectives <strong>of</strong> the HACC program;<br />
2. The nati<strong>on</strong>al c<strong>on</strong>text for resource allocati<strong>on</strong> in aged care and Comm<strong>on</strong>wealth<br />
planning processes;<br />
3. The basis <strong>on</strong> which the target populati<strong>on</strong> for HACC services is measured;<br />
4. The factors which should be taken into account to achieve equity across<br />
Victorian Regi<strong>on</strong>s in the distributi<strong>on</strong> <strong>of</strong> HACC resources, for example socioec<strong>on</strong>omic<br />
status, health status, cultural and linguistic diversity and geographic<br />
factors such as remoteness, and the methodology which should be used to<br />
apply those factors;<br />
5. The most effective approach to recognising the needs <strong>of</strong> rural LGAs;<br />
6. The impact <strong>of</strong> capacity to raise fees <strong>on</strong> regi<strong>on</strong>al resource allocati<strong>on</strong>;<br />
7. The basis <strong>on</strong> which judgements should be made in allocating resources<br />
between LGAs within regi<strong>on</strong>s;<br />
8. The relati<strong>on</strong>ship to local area planning and needs analysis;<br />
9. The planning and resource allocati<strong>on</strong> methodologies used by community<br />
support programs which delivery similar services to HACC in Victoria;<br />
10. The DHS Aged Community and Mental <strong>Health</strong> Divisi<strong>on</strong>’s funding reform<br />
project; and<br />
11. Methodologies used for these purposes in other states.<br />
These terms <strong>of</strong> reference express the c<strong>on</strong>cerns that have arisen in the c<strong>on</strong>text <strong>of</strong> the State<br />
government’s c<strong>on</strong>cern to expand the HACC Program in Victoria, and to achieve equity in the<br />
allocati<strong>on</strong> <strong>of</strong> growth funds through the <strong>RREF</strong>, and to resp<strong>on</strong>d to issues raised by provider and<br />
c<strong>on</strong>sumer groups about the effectiveness <strong>of</strong> the current <strong>RREF</strong> in pursuing these goals.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 1
Expanding the HACC Program in Victoria<br />
Part A: Background and Scope <strong>of</strong> the <strong>RREF</strong> Review<br />
The Victorian Government is committed to c<strong>on</strong>tinued growth in the HACC Program. In 2000-<br />
01, as well as matching the Comm<strong>on</strong>wealth’s <strong>of</strong>fer <strong>of</strong> $8.33 milli<strong>on</strong> growth with an allocati<strong>on</strong><br />
<strong>of</strong> $5.4 milli<strong>on</strong>, the State has allocated an additi<strong>on</strong>al $6.0 milli<strong>on</strong> for the expansi<strong>on</strong> <strong>of</strong> adult day<br />
groups and core HACC services. They will grow to $8.0 milli<strong>on</strong> in extra funds for <strong>2001</strong>-02.<br />
This is in additi<strong>on</strong> to extra funding provided for home care services for post acute hospital<br />
patients (Hospital to Home Program). A matching commitment has been sought from the<br />
Comm<strong>on</strong>wealth, but so far without success.<br />
In the c<strong>on</strong>text <strong>of</strong> nati<strong>on</strong>al resource allocati<strong>on</strong>, the Victorian Government is also c<strong>on</strong>cerned that<br />
Victoria is below the nati<strong>on</strong>al average for Comm<strong>on</strong>wealth-funded aged residential care services<br />
Productivity Commissi<strong>on</strong>, 2000). The Comm<strong>on</strong>wealth’s nati<strong>on</strong>al HACC equalisati<strong>on</strong> strategy<br />
aims to ensure that there is equal per capita funding for HACC services across Australia by<br />
2010-2011 by adjusting growth funds to each State and Territory each year. Victoria has been<br />
relatively well funded for HACC compared with other States and Territories and therefore<br />
receives a lower proporti<strong>on</strong> <strong>of</strong> growth funds each year. This equalisati<strong>on</strong> strategy does not,<br />
however, take account <strong>of</strong> Victoria’s relatively under funded positi<strong>on</strong> compared with other States<br />
and Territories, in Comm<strong>on</strong>wealth funded residential aged care which in turn puts substantial<br />
pressure <strong>on</strong> HACC services.<br />
The Victorian Government is committed to strengthening its partnership with the range <strong>of</strong><br />
HACC service providers; <strong>on</strong>e significant feature <strong>of</strong> the Program in Victoria has been the<br />
substantial financial c<strong>on</strong>tributi<strong>on</strong> to HACC services made by local government authorities.<br />
The <strong>RREF</strong> applies to HACC growth funds<br />
The Review is focused <strong>on</strong> the way in which the annual HACC growth funds are distributed to<br />
the nine DHS Regi<strong>on</strong>s. Growth funds for Linkages projects within HACC are now included in<br />
the total growth funds distributed through the <strong>RREF</strong>. The growth funds available for 2000-<strong>2001</strong><br />
were $19.7 milli<strong>on</strong>. Under the Comm<strong>on</strong>wealth’s nati<strong>on</strong>al equalisati<strong>on</strong> formula, growth in<br />
Victoria is expected to c<strong>on</strong>tinue at 5 to 6 % per annum. Because each year’s growth is<br />
incorporated into the base funding for the next year, the cumulative effect is quite c<strong>on</strong>siderable.<br />
An annual growth rate <strong>of</strong> this order results in an overall increase <strong>of</strong> around 30 % by the fifth<br />
year.<br />
Equity in distributi<strong>on</strong> <strong>of</strong> growth funds<br />
The State Government is c<strong>on</strong>cerned to ensure that HACC growth funds are distributed equitably<br />
in relati<strong>on</strong> to need.<br />
For the purposes <strong>of</strong> the current <strong>RREF</strong>, equity is defined as:<br />
• the distributi<strong>on</strong> <strong>of</strong> funds in relati<strong>on</strong> to need;<br />
• need is in turn defined by the distributi<strong>on</strong> <strong>of</strong> the HACC target populati<strong>on</strong>;<br />
and<br />
• the operati<strong>on</strong>al definiti<strong>on</strong> <strong>of</strong> the HACC target populati<strong>on</strong> is the distributi<strong>on</strong> <strong>of</strong><br />
the populati<strong>on</strong> with moderate, severe and pr<strong>of</strong>ound handicap, as measured<br />
by the ABS Survey <strong>of</strong> Disability, Ageing, and Carers.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 2
Part A: Background and Scope <strong>of</strong> the <strong>RREF</strong> Review<br />
Over the last eight years, HACC growth funds have been allocated to regi<strong>on</strong>s <strong>on</strong> the basis <strong>of</strong> the<br />
<strong>RREF</strong>. Over that time, the <strong>RREF</strong> has achieved a significantly greater degree <strong>of</strong> equity in<br />
resource distributi<strong>on</strong> in relati<strong>on</strong> to the distributi<strong>on</strong> <strong>of</strong> the HACC target populati<strong>on</strong> between DHS<br />
regi<strong>on</strong>s. In the last two years, some providers have raised questi<strong>on</strong>s as to whether the <strong>RREF</strong>, as<br />
it is currently structured and applied, is the most effective method for advancing equity in the<br />
distributi<strong>on</strong> <strong>of</strong> HACC resources. It is these c<strong>on</strong>cerns that have prompted the Victorian<br />
Government to undertake the present review.<br />
It was bey<strong>on</strong>d the scope <strong>of</strong> the Review to c<strong>on</strong>sider the adequacy <strong>of</strong> the total level <strong>of</strong> HACC<br />
funding. As noted, the Victorian Government is committed to increasing HACC funds and is<br />
negotiating with the Comm<strong>on</strong>wealth over the level <strong>of</strong> matching funds. Any additi<strong>on</strong>al funds<br />
that become available will be distributed through a process focused <strong>on</strong> achieving equity in<br />
relati<strong>on</strong> to need.<br />
HACC PROGRAM OBJECTIVES AND THE RESOURCE ALLOCATION<br />
PROCESS<br />
This secti<strong>on</strong> <strong>of</strong> the Paper provides a brief background to the way in which the <strong>RREF</strong> Review fits<br />
into developments in the HACC Program at nati<strong>on</strong>al and state level.<br />
Nati<strong>on</strong>al goals <strong>of</strong> the HACC Program<br />
The broad goals <strong>of</strong> the HACC Program are stated in the current HACC Agreement.<br />
They make reference to:<br />
1. Promoting the provisi<strong>on</strong> <strong>of</strong> a comprehensive, co-ordinated and integrated<br />
range <strong>of</strong> basic support and maintenance services for frail older people and<br />
younger people with disabilities and their carers, to enhance their<br />
independence in the community and prevent premature or inappropriate<br />
admissi<strong>on</strong> to l<strong>on</strong>g term residential care;<br />
2. Ensuring effective planning, m<strong>on</strong>itoring and accountability and facilitating<br />
input from c<strong>on</strong>sumers;<br />
3. Ensuring that within available resources, services are delivered in a manner<br />
which is cost effective, achieves integrati<strong>on</strong>, promotes independence and<br />
avoids duplicati<strong>on</strong>;<br />
4. Ensuring that, within available resources and within the broader service<br />
network, services are provided equitably between regi<strong>on</strong>s, resp<strong>on</strong>sive to<br />
regi<strong>on</strong>al differences and targeted to those who would benefit most and/or<br />
are most in need <strong>of</strong> these services;<br />
5. Promoting an integrated and co-ordinated approach between delivery <strong>of</strong><br />
home and community care and related health and welfare programs,<br />
including programs providing residential care; and<br />
6. Expanding and developing high quality home and community services<br />
through the joint co-operati<strong>on</strong> <strong>of</strong> the Comm<strong>on</strong>wealth, State/Territory, Local<br />
Governments and the community sectors.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 3
Part A: Background and Scope <strong>of</strong> the <strong>RREF</strong> Review<br />
The Victorian <strong>RREF</strong> is a major mechanism for pursuing the fourth objective, but it is not the<br />
<strong>on</strong>ly mechanism shaping resource allocati<strong>on</strong>. HACC funding in Victoria and in other states<br />
occurs within the wider c<strong>on</strong>text <strong>of</strong> planning, delivery and accountability, and draws <strong>on</strong> a range<br />
<strong>of</strong> other tools, including extensive c<strong>on</strong>sultati<strong>on</strong>.<br />
The nati<strong>on</strong>al HACC equalisati<strong>on</strong> strategy<br />
The nati<strong>on</strong>al budget for the HACC Program is divided am<strong>on</strong>g the States and Territories by a<br />
resource equalisati<strong>on</strong> formula similar to the <strong>RREF</strong>. Funds appropriated by the Comm<strong>on</strong>wealth<br />
are distributed between the States <strong>on</strong> the basis <strong>of</strong> each State’s share <strong>of</strong> the nati<strong>on</strong>al program’s<br />
target populati<strong>on</strong> with an underlying objective <strong>of</strong> equalizing HACC expenditure per capita<br />
across Australia. Comm<strong>on</strong>wealth funds are then matched in a roughly 60/40 ratio by each State.<br />
In the last few years, the nati<strong>on</strong>al target populati<strong>on</strong> has been calculated from data from the 1993<br />
Survey <strong>of</strong> Disability, Ageing and Carers, carried out by the ABS. Discussi<strong>on</strong>s are currently<br />
underway am<strong>on</strong>g Comm<strong>on</strong>wealth and State/Territory HACC <strong>of</strong>ficials <strong>on</strong> opti<strong>on</strong>s for revising or<br />
updating the nati<strong>on</strong>al formula.<br />
Regi<strong>on</strong>al HACC planning process in Victoria<br />
Since the 1995 Efficiency and Effectiveness Review, c<strong>on</strong>siderable progress has been made by<br />
the Comm<strong>on</strong>wealth and States in the development <strong>of</strong> regi<strong>on</strong>al planning frameworks, based <strong>on</strong><br />
the program’s output indicators. Nati<strong>on</strong>ally, the Comm<strong>on</strong>wealth sp<strong>on</strong>sored the development <strong>of</strong><br />
a computer-based Service Provisi<strong>on</strong> Targets Framework which has been used by State<br />
administering authorities since 1997 to help achieve more equity in service outputs.<br />
Victoria’s <strong>Department</strong> <strong>of</strong> Human Services has adapted this system, creating a ‘HACC Planning<br />
Tool’ using Excel spreadsheets. Once a regi<strong>on</strong> has been allocated its share <strong>of</strong> growth funds the<br />
DHS regi<strong>on</strong>al planners use the HACC Planning Tool to decide how to allocate the funds across<br />
the range <strong>of</strong> service providers and service types. Regi<strong>on</strong>al staff also arranged c<strong>on</strong>sultati<strong>on</strong>s with<br />
c<strong>on</strong>sumer and provider groups as part <strong>of</strong> this process. The aim is to achieve greater equity and<br />
comprehensiveness in the range <strong>of</strong> HACC service types across LGAs. In this c<strong>on</strong>text, ‘equity’<br />
is measured in terms <strong>of</strong> the number <strong>of</strong> hours <strong>of</strong> each service type available per thousand people<br />
in the HACC Target Populati<strong>on</strong>, as defined for use in the <strong>RREF</strong>.<br />
THE REVIEW PROCESS<br />
Timetable<br />
The Review was announced in May 2000 and the C<strong>on</strong>sultancy Team engaged to undertake the<br />
review the <strong>RREF</strong> commenced in October 2000. The first round <strong>of</strong> C<strong>on</strong>sultati<strong>on</strong>s were held in<br />
late November and early December 2000 and the sec<strong>on</strong>d round in March and April <strong>2001</strong>.<br />
C<strong>on</strong>sultati<strong>on</strong><br />
Reference Group and Steering Group<br />
The Review drew <strong>on</strong> inputs from a wide range <strong>of</strong> sources and was supported by a Reference<br />
Group comprising some 20 provider and c<strong>on</strong>sumer groups, as detailed in Appendix 1.1, and an<br />
internal DHS Steering Committee that included representatives <strong>of</strong> Regi<strong>on</strong>al Offices, as detailed<br />
in Appendix 1.2<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 4
Part A: Background and Scope <strong>of</strong> the <strong>RREF</strong> Review<br />
C<strong>on</strong>sultati<strong>on</strong> Paper<br />
A C<strong>on</strong>sultati<strong>on</strong> Paper was prepared as a basis for the first round <strong>of</strong> and as a guide for those<br />
making written submissi<strong>on</strong>s to the Review. The audience for the paper was all those involved<br />
in the HACC program, whether as actual or potential clients, carers, c<strong>on</strong>sumer organisati<strong>on</strong>s,<br />
providers and/or administrators.<br />
The C<strong>on</strong>sultati<strong>on</strong> Paper aimed to promote discussi<strong>on</strong> <strong>of</strong> the role <strong>of</strong> the resource allocati<strong>on</strong><br />
formula as an integral part <strong>of</strong> the HACC program. It set out the issues raised in the Terms <strong>of</strong><br />
Reference and posed 14 questi<strong>on</strong>s for discussi<strong>on</strong>. The questi<strong>on</strong>s were not exhaustive and it was<br />
expected that further issues would be raised in the c<strong>on</strong>sultati<strong>on</strong>s and submissi<strong>on</strong>s. The<br />
C<strong>on</strong>sultati<strong>on</strong> Paper made reference to some issues that were also being addressed in the<br />
c<strong>on</strong>current c<strong>on</strong>sultati<strong>on</strong>s <strong>on</strong> the report Targeting in the Home and Community Care Program<br />
(Howe and Gray, 1998), and separate c<strong>on</strong>sultati<strong>on</strong>s <strong>on</strong> that report were held following the <strong>RREF</strong><br />
c<strong>on</strong>sultati<strong>on</strong>s.<br />
Round 1 C<strong>on</strong>sultati<strong>on</strong>s and Submissi<strong>on</strong>s<br />
The C<strong>on</strong>sultati<strong>on</strong> Paper was widely distributed directly and via the DHS web site prior to the<br />
first round <strong>of</strong> c<strong>on</strong>sultati<strong>on</strong>s which were held in late November and early December 2000.<br />
C<strong>on</strong>sultati<strong>on</strong>s were held in each <strong>of</strong> the nine DHS regi<strong>on</strong>s across Victoria, four in metropolitan<br />
areas and five in rural areas. Additi<strong>on</strong>al c<strong>on</strong>sultati<strong>on</strong>s were also held in Mildura and Geel<strong>on</strong>g<br />
because <strong>of</strong> the geographic extent <strong>of</strong> the respective regi<strong>on</strong>s, and with indigenous groups. The<br />
Schedule <strong>of</strong> C<strong>on</strong>sultati<strong>on</strong>s is at Appendix 1.3.<br />
Some 200 individuals attended the c<strong>on</strong>sultati<strong>on</strong>s, representing 140 service providers and<br />
c<strong>on</strong>sumer representative organisati<strong>on</strong>s:<br />
• 35% were from Local Government;<br />
• 30% were from health related agencies such as ACAS and Community <strong>Health</strong><br />
Centres;<br />
• other community service agencies involved in HACC and related programs,<br />
including ethnic organisati<strong>on</strong>s: Visi<strong>on</strong> Australia, Uniting Care Victoria, Salvati<strong>on</strong><br />
Army, Baptist Community Care, Jewish Community Services, Australian Polish<br />
Community Services, Gippsland and East Gippsland Aboriginal Co-operative Ltd.,<br />
Chinese Community Social Services Centre, Greek Welfare Centre (Fairfield),<br />
Palliative Care Victoria, Associati<strong>on</strong> <strong>of</strong> Supportive Care Homes, Migrant Resource<br />
Centre (Mitcham);<br />
• smaller numbers <strong>of</strong> HACC providers specifically from the disability sector,<br />
including Community C<strong>on</strong>necti<strong>on</strong>s (Warrnambool), Interchange (Central Gippsland<br />
and Lodd<strong>on</strong>- Mallee), Victorian Brain Injury Recovery Centre, Bright Industries;<br />
• c<strong>on</strong>sumer groups, including Carers Victoria, Motor Neur<strong>on</strong>e Disease Associati<strong>on</strong>;<br />
and<br />
• Comm<strong>on</strong>wealth Government <strong>Department</strong>s, DHAC, DVA.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 5
Part A: Background and Scope <strong>of</strong> the <strong>RREF</strong> Review<br />
A total <strong>of</strong> 32 submissi<strong>on</strong>s were received, as listed in Appendix 1.4:<br />
• the majority were from Local Government, eight from individual Councils, two<br />
from groups <strong>of</strong> Councils and local community health services, and the Municipal<br />
Associati<strong>on</strong> <strong>of</strong> Victoria;<br />
• two were from major aged and community care providers that covered several<br />
regi<strong>on</strong>s, the Royal District Nursing Service, the largest single HACC agency in<br />
Victoria, and Uniting Care;<br />
• two were from health services, namely Barw<strong>on</strong> <strong>Health</strong> and the Children’s Hospital;<br />
• four were from organisati<strong>on</strong>s representing different client groups, including younger<br />
people with disabilities and ethnic communities.<br />
Following presentati<strong>on</strong> <strong>of</strong> a full report <strong>on</strong> the C<strong>on</strong>sultati<strong>on</strong>s to the Reference Group, a summary<br />
feed-back report was circulated in early <strong>2001</strong> to all who attended or who made submissi<strong>on</strong><br />
Opti<strong>on</strong>s Paper<br />
Following the first round <strong>of</strong> c<strong>on</strong>sultati<strong>on</strong>s and other research and development work by the<br />
C<strong>on</strong>sultancy team, an Opti<strong>on</strong>s Paper was prepared as a basis for the sec<strong>on</strong>d round <strong>of</strong><br />
c<strong>on</strong>sultati<strong>on</strong>s. The Opti<strong>on</strong>s Paper was distributed to all HACC agencies and to all those who<br />
participated in the first round <strong>of</strong> c<strong>on</strong>sultati<strong>on</strong>s including through regi<strong>on</strong>al DHS <strong>of</strong>fices and via<br />
the DHS web site.<br />
To provide a guide for the sec<strong>on</strong>d round <strong>of</strong> c<strong>on</strong>sultati<strong>on</strong>s, the Opti<strong>on</strong>s Paper followed the<br />
following steps:<br />
• it outlined the opti<strong>on</strong>s available at each step;<br />
• it noted the criteria to be c<strong>on</strong>sidered in deciding between opti<strong>on</strong>s;<br />
• it showed pr<strong>of</strong>iles <strong>of</strong> the variables identified for weighting the <strong>RREF</strong> base<br />
populati<strong>on</strong>s;<br />
• it presented <strong>RREF</strong> base populati<strong>on</strong>s and outcomes taking account <strong>of</strong> different<br />
opti<strong>on</strong>s; and<br />
• it sought feedback <strong>on</strong> each step <strong>of</strong> the development <strong>of</strong> the opti<strong>on</strong>s for the revised<br />
<strong>RREF</strong>.<br />
Each step ended with a summary <strong>of</strong> the opti<strong>on</strong>s developed and questi<strong>on</strong>s for discussi<strong>on</strong> at the<br />
C<strong>on</strong>sultati<strong>on</strong>s. It was emphasised that n<strong>on</strong>e <strong>of</strong> the opti<strong>on</strong>s presented in the Opti<strong>on</strong>s Paper had<br />
been identified as preferred opti<strong>on</strong>s for the revised <strong>RREF</strong>, and that the final revised <strong>RREF</strong><br />
would <strong>on</strong>ly emerge after the sec<strong>on</strong>d round <strong>of</strong> c<strong>on</strong>sultati<strong>on</strong>s. The opti<strong>on</strong>s presented in the<br />
c<strong>on</strong>sultati<strong>on</strong>s and the further issues identified are reported in Part C and Part D <strong>of</strong> this report.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 6
Part A: Background and Scope <strong>of</strong> the <strong>RREF</strong> Review<br />
Round 2 C<strong>on</strong>sultati<strong>on</strong>s<br />
The sec<strong>on</strong>d round <strong>of</strong> c<strong>on</strong>sultati<strong>on</strong>s was held in late March and early April <strong>2001</strong>. Again,<br />
c<strong>on</strong>sultati<strong>on</strong>s were held in all nine regi<strong>on</strong>s and in Mildura and Geel<strong>on</strong>g, as per the schedule at<br />
Appendix 1.3. A further c<strong>on</strong>sultati<strong>on</strong> was also held with indigenous groups<br />
Almost 200 individuals from 148 organisati<strong>on</strong>s attended. A similar range <strong>of</strong> agencies was<br />
represented as at the first round <strong>of</strong> c<strong>on</strong>sultati<strong>on</strong>s<br />
To assist in recording views <strong>on</strong> issues and opti<strong>on</strong>s presented at the Round 2 C<strong>on</strong>sultati<strong>on</strong>s,<br />
participants were provided with a resp<strong>on</strong>se sheet. Just <strong>on</strong> half <strong>of</strong> all the participants returned a<br />
completed resp<strong>on</strong>se at the c<strong>on</strong>sultati<strong>on</strong> or subsequently and a tally <strong>of</strong> the resp<strong>on</strong>ses was made to<br />
provide a summary account <strong>of</strong> the views expressed.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g><br />
Informati<strong>on</strong> gathered from the c<strong>on</strong>sultati<strong>on</strong>s and submissi<strong>on</strong>s was drawn <strong>on</strong> extensively as the<br />
Review progressed and is incorporated in the later secti<strong>on</strong>s <strong>of</strong> this <str<strong>on</strong>g>Report</str<strong>on</strong>g>. This <str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g><br />
also draws <strong>on</strong> the material presented in the C<strong>on</strong>sultati<strong>on</strong> Paper and Opti<strong>on</strong>s Paper.<br />
ROLE OF THE <strong>RREF</strong> IN THE HACC PROGRAM<br />
How the current <strong>RREF</strong> allocates growth funds to regi<strong>on</strong>s<br />
The <strong>RREF</strong> was introduced in 1992 as a mechanism for allocating the additi<strong>on</strong>al resources made<br />
available as HACC growth funds each year to the nine DHS regi<strong>on</strong>s <strong>on</strong> an equitable basis. To<br />
this end, the <strong>RREF</strong> is used to measure the share <strong>of</strong> resources currently allocated to the nine DHS<br />
regi<strong>on</strong>s against an ‘equity’ distributi<strong>on</strong> in which any regi<strong>on</strong> would receive the same number <strong>of</strong><br />
dollars per pers<strong>on</strong> in the Target Populati<strong>on</strong>. Where any regi<strong>on</strong> is more than 5 % below ‘equity’,<br />
some <strong>of</strong> the annual growth funds are set aside for a special allocati<strong>on</strong> to these under-funded<br />
regi<strong>on</strong>s to bring them closer to the statewide equity level <strong>of</strong> funding.<br />
The remaining growth funds are then allocated to all regi<strong>on</strong>s in accord with each regi<strong>on</strong>’s<br />
proporti<strong>on</strong> <strong>of</strong> the State’s total Target Populati<strong>on</strong>. The size <strong>of</strong> each regi<strong>on</strong>al HACC Target<br />
Populati<strong>on</strong> is built up from estimates <strong>of</strong> the HACC Target Populati<strong>on</strong> in each LGA.<br />
An example <strong>of</strong> how the <strong>RREF</strong> works at the LGA and regi<strong>on</strong>al level is presented in the box over.<br />
Equity outcomes achieved 1995-96 to 1999-2000<br />
An equitable distributi<strong>on</strong> <strong>of</strong> HACC resources is achieved when all members <strong>of</strong> the HACC target<br />
populati<strong>on</strong> in all regi<strong>on</strong>s receive the same per capita dollar funding. Each regi<strong>on</strong>’s share <strong>of</strong> the<br />
State’s total HACC funding would then be equal to its share <strong>of</strong> the total State target populati<strong>on</strong>.<br />
Regi<strong>on</strong>al deviati<strong>on</strong>s from equity are shown in the graph below. The bars in the graph show the<br />
percentage difference between the actual level <strong>of</strong> funding received and the amount that would<br />
be received if each regi<strong>on</strong> was funded at the statewide per capita level.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 7
Part A: Background and Scope <strong>of</strong> the <strong>RREF</strong> Review<br />
Figure 1 shows that c<strong>on</strong>siderable progress towards equity as defined by the current <strong>RREF</strong> has<br />
been made over time:<br />
• In 1995-96, three regi<strong>on</strong>s were 15% above equity, <strong>on</strong>e was 14% below, and <strong>on</strong>ly<br />
three were within 5% <strong>of</strong> equity.<br />
• By 1999-2000, seven regi<strong>on</strong>s were within 2.5% above or below equity, a 5%<br />
variati<strong>on</strong> overall, and the other two regi<strong>on</strong>s were <strong>on</strong>ly 3% and 5% above equity.<br />
How the <strong>RREF</strong> works at local and regi<strong>on</strong>al level<br />
The Rural Shire <strong>of</strong> Jindyworobak has a total populati<strong>on</strong> <strong>of</strong> 11,038 as at the 1996<br />
Census. The <strong>Department</strong> <strong>of</strong> Infrastructure (DOI) projecti<strong>on</strong>s give a populati<strong>on</strong> <strong>of</strong><br />
11,520 for that LGA in <strong>2001</strong>.<br />
As the HACC target populati<strong>on</strong> covers <strong>on</strong>ly the populati<strong>on</strong> living in the<br />
community, all those living in any kind <strong>of</strong> residential care facilities are excluded.<br />
The number <strong>of</strong> people with a moderate, severe or pr<strong>of</strong>ound handicap aged 0 to<br />
85 in the LGA is estimated by applying the Statewide prevalence rates in the<br />
1998 Disability, Ageing and Carers Survey to the age structure <strong>of</strong> the projected<br />
populati<strong>on</strong> <strong>of</strong> Jindyworobak. This number is estimated as 1,136 people.<br />
The total number <strong>of</strong> people aged 85 and over are included in the target<br />
populati<strong>on</strong>. According to DOI projecti<strong>on</strong>s, there will be 196 people aged 85 and<br />
over living in the community in Jindyworobak in <strong>2001</strong>.<br />
The total HACC Target Populati<strong>on</strong> <strong>of</strong> Jindyworobak is 1,136 + 196 = 1,332<br />
people.<br />
Now c<strong>on</strong>sider rurality. The Shire <strong>of</strong> Jindyworobak has a density <strong>of</strong> 0.37 target<br />
group pers<strong>on</strong>s per square kilometre. All LGAs with a density below 2 target<br />
group pers<strong>on</strong>s per sq. km are assigned a 30% weighting for rurality. Weighting<br />
<strong>of</strong> Jindyworobak’s HACC Target Populati<strong>on</strong> by 30 % gives a <strong>RREF</strong> Populati<strong>on</strong> <strong>of</strong><br />
1,732 people (1,332 x 1.30).<br />
Jindyworobak is a small rural shire in the Eastern Rural Regi<strong>on</strong>, which has 17<br />
LGAs in all, including a large provincial city. This exercise is repeated for each<br />
LGA. When summed, the total regi<strong>on</strong>al HACC Target Populati<strong>on</strong> accounts for<br />
8% <strong>of</strong> the State HACC Target Populati<strong>on</strong>, so the regi<strong>on</strong> will receive 8% <strong>of</strong> the<br />
HACC Growth Funds that are allocated through the <strong>RREF</strong> for 2000/01. If these<br />
growth funds were $15m, the regi<strong>on</strong> would receive $1.2m.<br />
As Jindyworobak has 0.34% <strong>of</strong> the total Victorian HACC <strong>RREF</strong> Target<br />
Populati<strong>on</strong>, it should noti<strong>on</strong>ally receive 0.34% <strong>of</strong> the growth funds, or $51,000.<br />
However, most <strong>of</strong> the regi<strong>on</strong>’s Aboriginal populati<strong>on</strong> is located in Jindyworobak,<br />
and following c<strong>on</strong>sultati<strong>on</strong> <strong>on</strong> regi<strong>on</strong>al priorities, a decisi<strong>on</strong> is reached to provide<br />
more than the noti<strong>on</strong>al share <strong>of</strong> funds to Jindyworobak.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 8
Part A: Background and Scope <strong>of</strong> the <strong>RREF</strong> Review<br />
Figure 1: C<strong>on</strong>vergence <strong>on</strong> Relative Equity 1995/96 - 1999/2000<br />
20.0%<br />
15.0%<br />
BAR<br />
GRAM<br />
10.0%<br />
5.0%<br />
0.0%<br />
-5.0%<br />
-10.0%<br />
LOD<br />
HUME<br />
GIP<br />
WMR<br />
NMR<br />
SMR<br />
1995/96<br />
1996/97<br />
1997/98<br />
1998/99<br />
1999/2000<br />
-15.0%<br />
EMR<br />
-20.0%<br />
Regi<strong>on</strong><br />
This steady progress towards equity is, <strong>of</strong> course, completely dependent <strong>on</strong> a particular<br />
definiti<strong>on</strong> <strong>of</strong> the HACC Target Populati<strong>on</strong>. The graph shows c<strong>on</strong>vergence towards equity as<br />
defined by the present <strong>RREF</strong>. If the operati<strong>on</strong>al definiti<strong>on</strong> <strong>of</strong> the target populati<strong>on</strong> were<br />
significantly altered, the trend shown in the graph would change.<br />
Alternative ways <strong>of</strong> operati<strong>on</strong>alising the HACC target populati<strong>on</strong>s are presented as opti<strong>on</strong>s for<br />
the Base Populati<strong>on</strong> in the <strong>RREF</strong> in Part B <strong>of</strong> this <str<strong>on</strong>g>Report</str<strong>on</strong>g>.<br />
It should also be noted that the operati<strong>on</strong>al definiti<strong>on</strong> is not intended to be used by service<br />
providers to calculate the number <strong>of</strong> people actually eligible for HACC services in their<br />
catchment area. If the <strong>RREF</strong> calculates that the HACC Base Populati<strong>on</strong> <strong>of</strong> a given municipality<br />
is 1775 people, it is not legitimate to c<strong>on</strong>clude that 1775 people are actually in need <strong>of</strong> HACC<br />
services, and it is not legitimate to criticise the formula <strong>on</strong> the basis that local agencies believe<br />
more (or fewer) people are actually in need <strong>of</strong> services. The <strong>on</strong>ly legitimate use <strong>of</strong> the number<br />
is to say that the LGA has a given share <strong>of</strong> the State’s total HACC Base Populati<strong>on</strong> when the<br />
populati<strong>on</strong>s in all LGAs are calculated by the same method.<br />
A final comment <strong>on</strong> the current <strong>RREF</strong> is that it is a dynamic model and even with c<strong>on</strong>tinuati<strong>on</strong><br />
<strong>of</strong> the current <strong>RREF</strong> there would be changes in the shares <strong>of</strong> HACC resources allocated to each<br />
regi<strong>on</strong>, in line with demographic trends.<br />
THE HACC TARGET POPULATION IN THE CURRENT <strong>RREF</strong><br />
Definiti<strong>on</strong>s<br />
The main principle behind the <strong>RREF</strong> is that any geographical regi<strong>on</strong> should receive funds in<br />
proporti<strong>on</strong> to the number <strong>of</strong> people in that regi<strong>on</strong> who need HACC services. Since the exact<br />
number <strong>of</strong> people requiring HACC services is not known with any precisi<strong>on</strong>, the allocati<strong>on</strong><br />
formula uses an approximati<strong>on</strong> or proxy measure. The approximati<strong>on</strong> used is the populati<strong>on</strong><br />
who are eligible for HACC services in each regi<strong>on</strong>.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 9
Part A: Background and Scope <strong>of</strong> the <strong>RREF</strong> Review<br />
According to the HACC Amending Agreement (1998), those eligible for services under the<br />
HACC Program comprise frail older people and younger people with disabilities and their<br />
carers living in the community and who are eligible to receive HACC services <strong>on</strong> the grounds <strong>of</strong><br />
having a level <strong>of</strong> disability that affects their capacity to perform activities <strong>of</strong> daily living and<br />
participate in the community. This is the broad definiti<strong>on</strong> <strong>of</strong> the HACC target populati<strong>on</strong> and it<br />
will not be changed by the <strong>RREF</strong> Review. However, this broad definiti<strong>on</strong> is not sufficient to<br />
guide resource allocati<strong>on</strong> because it does not specify how the number <strong>of</strong> ‘frail older people and<br />
younger people with disabilities’ will be measured. There is also a problem with handling the<br />
potential overlap between the number <strong>of</strong> frail or disabled people and their carers who may also<br />
be frail and disabled. A more ‘operati<strong>on</strong>al’ definiti<strong>on</strong> is needed.<br />
Before c<strong>on</strong>sidering opti<strong>on</strong>s for developing the base populati<strong>on</strong>s for a revised <strong>RREF</strong> and how<br />
they might be weighted to take account <strong>of</strong> need factors, it should be noted that the <strong>RREF</strong><br />
allocates resources to regi<strong>on</strong>s <strong>on</strong> the basis <strong>of</strong> the HACC target populati<strong>on</strong> in each <strong>of</strong> the nine<br />
DHS regi<strong>on</strong>s in Victoria. The regi<strong>on</strong>al populati<strong>on</strong>s are built up from data for LGAs, but the<br />
allocati<strong>on</strong>s are made at a regi<strong>on</strong>al level. The allocati<strong>on</strong> <strong>of</strong> these resources to different services<br />
operating in different local areas within each regi<strong>on</strong> is then decided <strong>on</strong> the basis <strong>of</strong> regi<strong>on</strong>al<br />
planning. The <strong>RREF</strong> does not determine resource allocati<strong>on</strong>s at LGA level, but the data used in<br />
building the <strong>RREF</strong> is <strong>on</strong>e source <strong>of</strong> informati<strong>on</strong> for these decisi<strong>on</strong>s. The c<strong>on</strong>sultati<strong>on</strong>s<br />
identified the value <strong>of</strong> closer links between the <strong>RREF</strong> and the regi<strong>on</strong>al planning process, and<br />
DHS is committed to strengthening these links.<br />
Operati<strong>on</strong>alising the HACC target populati<strong>on</strong><br />
The way in which the definiti<strong>on</strong> <strong>of</strong> the HACC target populati<strong>on</strong> is operati<strong>on</strong>alised is critical to<br />
the resource allocati<strong>on</strong> outcomes realised through any formula based <strong>on</strong> that target populati<strong>on</strong>.<br />
The operati<strong>on</strong>al definiti<strong>on</strong> used in the current <strong>RREF</strong> was determined in 1992 and was limited by<br />
the range <strong>of</strong> data then available. It comprises three comp<strong>on</strong>ents:<br />
1. people <strong>of</strong> all ages living in the community who have a moderate, severe or<br />
pr<strong>of</strong>ound level <strong>of</strong> core activity restricti<strong>on</strong> (level <strong>of</strong> handicap). The 1998 ABS<br />
Survey <strong>of</strong> Disability, Ageing and Carers (DACS) is the source <strong>of</strong> informati<strong>on</strong><br />
<strong>on</strong> the number <strong>of</strong> people with a core activity restricti<strong>on</strong> and these figures are<br />
updated to the current year (e.g. <strong>2001</strong>) for which the <strong>RREF</strong> is being calculated,<br />
using the <strong>Department</strong> <strong>of</strong> Infrastructure populati<strong>on</strong> projecti<strong>on</strong>s for LGAs;<br />
2. plus those people aged 85 and over living in the community who do not have a<br />
core activity restricti<strong>on</strong>; plus<br />
3. a weighting for rurality.<br />
As the way in which each <strong>of</strong> these comp<strong>on</strong>ents has been defined has been the subject <strong>of</strong><br />
increasing debate, it is necessary to clarify the current definiti<strong>on</strong>s as follows:<br />
Handicap<br />
In the current <strong>RREF</strong>, handicap is the main factor representing need for HACC services. The<br />
1998 ABS Survey <strong>of</strong> Disability, Ageing and Carers (DACS) is the source <strong>of</strong> informati<strong>on</strong> <strong>on</strong> the<br />
number <strong>of</strong> people with a ‘core activity restricti<strong>on</strong>’ which means the individual needs supervisi<strong>on</strong><br />
or assistance from another pers<strong>on</strong>, either an informal carer or a formal service provider, to carry<br />
out activities <strong>of</strong> daily living and for social participati<strong>on</strong>. The definiti<strong>on</strong>s used in DACS are set<br />
out in Appendix 2. Figures are updated to the current year (e.g. 2002) for which the <strong>RREF</strong> is<br />
being calculated, using the <strong>Department</strong> <strong>of</strong> Infrastructure populati<strong>on</strong> projecti<strong>on</strong>s based <strong>on</strong> the<br />
1996 Census.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 10
Part A: Background and Scope <strong>of</strong> the <strong>RREF</strong> Review<br />
There are however no reliable data <strong>on</strong> handicap by age group at the LGA level. Unlike the<br />
Census, the Disability, Ageing and Carers Survey is based <strong>on</strong> a sample <strong>of</strong> the populati<strong>on</strong>. The<br />
sample is selected in proporti<strong>on</strong> to each state’s populati<strong>on</strong> and so provides reliable estimates <strong>of</strong><br />
the prevalence <strong>of</strong> handicap in each state by age group. The sample is however too small to be<br />
used to provide separate estimates <strong>of</strong> age-specific prevalence for each LGA. The present <strong>RREF</strong><br />
gets around this problem by applying the single set <strong>of</strong> statewide rates <strong>of</strong> handicap to the age<br />
structure in each LGA. As the figures in Figure 2 show, there is a very str<strong>on</strong>g relati<strong>on</strong>ship<br />
between age and rates <strong>of</strong> handicap.<br />
This method assumes that there is no variati<strong>on</strong> in age-specific rates <strong>of</strong> handicap between LGAs.<br />
In reality, some LGAs may have higher or lower rates <strong>of</strong> handicap for reas<strong>on</strong>s other than age<br />
structure, but the current <strong>RREF</strong> cannot take these variati<strong>on</strong>s into account.<br />
It is also recognised that there is some variati<strong>on</strong> in age-specific prevalence <strong>of</strong> handicap for<br />
different populati<strong>on</strong> groups. In particular, the higher age-specific rates <strong>of</strong> handicap in the<br />
indigenous populati<strong>on</strong> are taken into account in some programs, but not in the current <strong>RREF</strong>.<br />
The formula for the Comm<strong>on</strong>wealth State Disability Agreement, for example, gives double<br />
weight to the Koori populati<strong>on</strong> in each state as the program provides double funding per capita<br />
for this populati<strong>on</strong>.<br />
Frail aged<br />
An adjustment for the frail aged is made in the current <strong>RREF</strong> by including the total populati<strong>on</strong><br />
aged 85 and over who are living in the community, that is, not <strong>on</strong>ly those with moderate, severe<br />
or pr<strong>of</strong>ound activities.<br />
Rural Weighting<br />
The <strong>on</strong>ly weighting in the current <strong>RREF</strong> is for rurality. The rural weighting takes account <strong>of</strong> the<br />
dispersi<strong>on</strong> <strong>of</strong> the target populati<strong>on</strong>; the more dispersed the populati<strong>on</strong>, the higher the weighting.<br />
The rural weighting is calculated by dividing the number <strong>of</strong> people in the HACC target<br />
populati<strong>on</strong> in the LGA by the area <strong>of</strong> the LGA (in square kilometres). If the density is:<br />
above 10 target populati<strong>on</strong> pers<strong>on</strong>s per sq. km, no weighting is applied;<br />
between 5 – 10 target populati<strong>on</strong> pers<strong>on</strong>s per sq. km, the weighting is 10%;<br />
between 2 – 5 target populati<strong>on</strong> pers<strong>on</strong>s per sq. km, the weighting is 20%; and<br />
less than 2 pers<strong>on</strong>s target populati<strong>on</strong> pers<strong>on</strong>s per sq. km, the weighting is 30%.<br />
Thus rural LGAs with the lowest populati<strong>on</strong> densities are treated as though their Target<br />
Populati<strong>on</strong> were 30 % greater. They therefore attract a higher share <strong>of</strong> growth funds.<br />
The current rural weighting was determined by the <strong>RREF</strong> Steering Committee in 1992.<br />
Additi<strong>on</strong>al costs associated with service delivery in rural areas was the <strong>on</strong>ly factor supported by<br />
all the interest groups c<strong>on</strong>sulted, and a measure <strong>of</strong> the density <strong>of</strong> the target populati<strong>on</strong> was<br />
adopted. Two points about the way in which the rural weighting was decided warrant comment:<br />
The Steering Committee noted that it was unable to find empirical data to support the selecti<strong>on</strong><br />
<strong>of</strong> the 10%, 20% and 30%, but indicated that given the extent <strong>of</strong> support for recogniti<strong>on</strong> <strong>of</strong> this<br />
factor, there was justificati<strong>on</strong> for including the “relatively nominal” percentages. The<br />
weightings are however far higher than the rural weightings included in any <strong>of</strong> the formulas that<br />
have been developed subsequently.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 11
Part A: Background and Scope <strong>of</strong> the <strong>RREF</strong> Review<br />
The weighting was given in recogniti<strong>on</strong> <strong>of</strong> higher costs <strong>of</strong> service delivery in rural areas rather<br />
than higher need, but this recogniti<strong>on</strong> <strong>of</strong> higher costs was over-ridden with the introducti<strong>on</strong> <strong>of</strong><br />
unit pricing and the same unit prices have applied across the state since then.<br />
The c<strong>on</strong>tributi<strong>on</strong> <strong>of</strong> the three comp<strong>on</strong>ents to the current <strong>RREF</strong> base populati<strong>on</strong> for the state is:<br />
87.7% Moderately, severely and pr<strong>of</strong>oundly handicapped, age weighted<br />
populati<strong>on</strong><br />
5.5% Populati<strong>on</strong> aged 85+ in additi<strong>on</strong> to handicapped 85+<br />
6.8% Rural weighting<br />
This outcome dem<strong>on</strong>strates very clearly that as well as the level <strong>of</strong> the rural weighting, the size<br />
and age structure <strong>of</strong> the LGA populati<strong>on</strong> to which the weighting is applied, is a major factor in<br />
determining the outcomes <strong>of</strong> any formula. Given the criticisms that the current <strong>RREF</strong> makes an<br />
inadequate adjustment for the frail aged and neglects factors affecting need for HACC services<br />
other than rurality, <strong>on</strong>e basis for assessing alternative formulas is the extent <strong>of</strong> change in the<br />
c<strong>on</strong>tributi<strong>on</strong> that each <strong>of</strong> these three comp<strong>on</strong>ents makes to the overall outcome.<br />
PROFILE OF CURRENT USERS OF HACC SERVICES<br />
Only a very basic pr<strong>of</strong>ile <strong>of</strong> current users <strong>of</strong> HACC can be presented using data from the latest<br />
HACC User Characteristics Survey, c<strong>on</strong>ducted by DHS in 1998. Implementati<strong>on</strong> <strong>of</strong> the HACC<br />
Minimum Data Set will provide a much fuller account <strong>of</strong> clients receiving services and enable<br />
the actual client populati<strong>on</strong> to be compared to the eligible target populati<strong>on</strong>.<br />
Age Groups<br />
Rates <strong>of</strong> activity restricti<strong>on</strong>s that give rise to the need for HACC services increase rapidly with<br />
advancing age, and the majority <strong>of</strong> HACC clients are in the frail aged segment <strong>of</strong> the target<br />
populati<strong>on</strong>. Almost 80% <strong>of</strong> HACC clients are aged 65 and over, and more than 40 % are aged<br />
80 and over. With the excepti<strong>on</strong> <strong>of</strong> the very youngest age group, the majority <strong>of</strong> HACC clients<br />
are female.<br />
Ethnicity<br />
Access to HACC services <strong>on</strong> the part <strong>of</strong> clients <strong>of</strong> different cultural and linguistic background is<br />
indicated by data collected in the 1998 HACC User Characteristics Survey <strong>on</strong> country <strong>of</strong> birth,<br />
categorised <strong>on</strong> the basis <strong>of</strong> language spoken in country <strong>of</strong> birth. The proporti<strong>on</strong>s <strong>of</strong> clients born<br />
in the three major categories are:<br />
75% born in Australia<br />
8% born in English speaking countries<br />
17% born in n<strong>on</strong>-English speaking countries.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 12
Part A: Background and Scope <strong>of</strong> the <strong>RREF</strong> Review<br />
While this distributi<strong>on</strong> <strong>of</strong> the total client populati<strong>on</strong> matches the birthplace distributi<strong>on</strong> <strong>of</strong> the<br />
Victorian populati<strong>on</strong>, four provisos need to be noted:<br />
1. aggregate data <strong>on</strong> the total populati<strong>on</strong> born in n<strong>on</strong>-English speaking countries do<br />
not provide a view <strong>of</strong> variati<strong>on</strong>s in access between different ethnic groups;<br />
2. there are marked variati<strong>on</strong>s in the c<strong>on</strong>centrati<strong>on</strong>s <strong>of</strong> different ethnic groups in<br />
different areas <strong>of</strong> the state;<br />
3. the effect <strong>of</strong> factors other than age may have particular effects <strong>on</strong> the prevalence<br />
<strong>of</strong> disability in some ethnic groups; and<br />
4. access to available services is also affected by cultural c<strong>on</strong>siderati<strong>on</strong>s.<br />
WHAT REVISION OF THE <strong>RREF</strong> CAN AND CANNOT ACHIEVE<br />
Accepting that there is agreement that HACC resources should c<strong>on</strong>tinue to be allocated to<br />
regi<strong>on</strong>s through a needs based formula, the Review needed to clarify the range <strong>of</strong> outcomes that<br />
revisi<strong>on</strong> <strong>of</strong> the <strong>RREF</strong> could be expected to achieve and, and what it could achieve.<br />
Revisi<strong>on</strong> <strong>of</strong> the <strong>RREF</strong> has the capacity to address the inadequacy <strong>of</strong> the present formula in not<br />
taking account <strong>of</strong> factors other than age that are seen to affect levels <strong>of</strong> handicap in local<br />
populati<strong>on</strong>s.<br />
Revisi<strong>on</strong> <strong>of</strong> the <strong>RREF</strong> will:<br />
• redefine the level <strong>of</strong> per capita funding that achieves an equitable allocati<strong>on</strong><br />
between regi<strong>on</strong>s <strong>on</strong> the basis <strong>of</strong> relative need, and<br />
• result in redefiniti<strong>on</strong> <strong>of</strong> the shares <strong>of</strong> HACC growth funds that each regi<strong>on</strong> is to<br />
receive in accord with this new definiti<strong>on</strong> <strong>of</strong> equity.<br />
The <strong>RREF</strong> is <strong>on</strong>ly <strong>on</strong>e <strong>of</strong> a number <strong>of</strong> measures that determine the funding <strong>of</strong> the HACC<br />
program, and these other measures address issues bey<strong>on</strong>d the current <strong>RREF</strong> or any revised<br />
<strong>RREF</strong>.<br />
Revisi<strong>on</strong> <strong>of</strong> the <strong>RREF</strong> will not increase the total level <strong>of</strong> resources available for the program.<br />
The level <strong>of</strong> growth funds that become available each year is determined by the amount put<br />
forward by the Comm<strong>on</strong>wealth for matching and the level <strong>of</strong> matching funds put forward by the<br />
Victorian government, and these amounts depend in turn <strong>on</strong> federal and state budgetary<br />
processes.<br />
The <strong>RREF</strong> will not affect the amount paid for services under service agreements between<br />
providers and DHS. These prices are determined by the unit price cost structure established as<br />
part <strong>of</strong> the DHS funding strategy.<br />
Whilst special needs groups may be recognised in the formula, inclusi<strong>on</strong> <strong>of</strong> such variables in the<br />
<strong>RREF</strong> does not guarantee better access or more resp<strong>on</strong>sive service delivery for the groups<br />
c<strong>on</strong>cerned. HACC Service Development Grants will have a c<strong>on</strong>tinuing role in translating<br />
resources that are made available into modes <strong>of</strong> service delivery that are resp<strong>on</strong>sive to special<br />
needs.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 13
Part A: Background and Scope <strong>of</strong> the <strong>RREF</strong> Review<br />
The <strong>RREF</strong> will not distribute resources to providers or to local areas, but <strong>on</strong>ly at the regi<strong>on</strong>al<br />
level. Informati<strong>on</strong> generated in the Review may however be useful in regi<strong>on</strong>al and local<br />
planning, together with other kinds <strong>of</strong> local informati<strong>on</strong>.<br />
The Review has been undertaken with the goal <strong>of</strong> advancing equity in the HACC program.<br />
Achievement <strong>of</strong> this outcome will be furthered if complementary measures can be taken in other<br />
areas <strong>of</strong> the program as part <strong>of</strong> the implementati<strong>on</strong> strategy for any revised <strong>RREF</strong>.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 14
PART B: DEVELOPMENT OF OPTIONS FOR A<br />
REVISED <strong>RREF</strong><br />
The development <strong>of</strong> opti<strong>on</strong>s for the revised <strong>RREF</strong> proceeded in four steps, as set out in Chart 1,<br />
and outcomes were developed in a further three steps reported in Part C. This part <strong>of</strong> the report<br />
draws <strong>on</strong> the material presented in the C<strong>on</strong>sultati<strong>on</strong> Paper and Opti<strong>on</strong>s Paper and the<br />
discussi<strong>on</strong>s in both rounds <strong>of</strong> C<strong>on</strong>sultati<strong>on</strong>s. At each step, any further issues arising are<br />
canvassed and further investigati<strong>on</strong>s and analyses undertaken by the C<strong>on</strong>sultancy Team are<br />
noted. The extent to which preferred opti<strong>on</strong>s emerged is identified and these opti<strong>on</strong>s have been<br />
then taken into account in modelling the outcomes reported in Part C; where no clear preferred<br />
opti<strong>on</strong>s are identified and a range <strong>of</strong> opti<strong>on</strong>s have been modelled.<br />
Chart 1: Development <strong>of</strong> Opti<strong>on</strong>s for the <strong>RREF</strong><br />
Step1: Opti<strong>on</strong>s for defining the <strong>RREF</strong> base<br />
populati<strong>on</strong><br />
1.1 Data sources for identificati<strong>on</strong> <strong>of</strong><br />
populati<strong>on</strong> in need <strong>of</strong> HACC services<br />
1 2 Prevalence <strong>of</strong> handicap<br />
< OPTIONS ><br />
1.3 Living in the community<br />
1.4 Opti<strong>on</strong>s for Frail Aged<br />
1.5 Other exclusi<strong>on</strong>s – Veterans?<br />
Step 2: Review Opti<strong>on</strong>s for Variables for<br />
weighting <strong>RREF</strong> Base Populati<strong>on</strong>s<br />
< OPTIONS ><br />
2.1 Identificati<strong>on</strong> <strong>of</strong> variables 2.2 Criteria for assessing variables<br />
2.3 Assessment <strong>of</strong> variables<br />
STEP 3: REVIEW OPTIONS FOR SCALING<br />
3.1 Scaling <strong>of</strong> variables<br />
< OPTIONS ><br />
3.2 Pr<strong>of</strong>ile variables<br />
Step 4: Opti<strong>on</strong>s for Weighting Variables<br />
4.1 Examples from other formulas<br />
4.2 Principal Comp<strong>on</strong>ents Analysis<br />
< OPTIONS ><br />
5.3 Expert Advice<br />
5.4 Adjustment to weighting<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 15
Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
STEP 1: OPTIONS FOR DEFINING THE <strong>RREF</strong> BASE POPULATION<br />
1.1 IDENTIFYING THOSE IN NEED OF HACC SERVICES<br />
In c<strong>on</strong>sidering opti<strong>on</strong>s for operati<strong>on</strong>alising the HACC target populati<strong>on</strong> and then c<strong>on</strong>sidering<br />
need factors to be taken into account in weighting the <strong>RREF</strong>, the Review team found it useful to<br />
distinguish between:<br />
1. The HACC target populati<strong>on</strong> which is defined in the 1985 HACC Act<br />
as younger people with a disability and frail aged individuals who are<br />
living in the community and who are eligible to receive HACC services<br />
<strong>on</strong> the grounds <strong>of</strong> having a level <strong>of</strong> disability that affects their capacity<br />
to perform activities <strong>of</strong> daily living and participate in the community.<br />
2. The <strong>RREF</strong> base populati<strong>on</strong> which in the first instance is based <strong>on</strong> the<br />
operati<strong>on</strong>alisati<strong>on</strong> <strong>of</strong> the HACC target populati<strong>on</strong> at both<br />
Comm<strong>on</strong>wealth and State levels by reference to the ABS Disability,<br />
Ageing and Carers Survey as those living in the community with a<br />
moderate, severe or pr<strong>of</strong>ound level <strong>of</strong> core activity restricti<strong>on</strong>.<br />
3. The <strong>RREF</strong> weighted populati<strong>on</strong> which is the <strong>RREF</strong> base populati<strong>on</strong><br />
for each LGA weighted by the various need factors c<strong>on</strong>sidered to more<br />
accurately discriminate between regi<strong>on</strong>s <strong>on</strong> the basis <strong>of</strong> different levels<br />
<strong>of</strong> need and hence to be taken into account in resource allocati<strong>on</strong>. The<br />
<strong>on</strong>ly weighting factor in the current <strong>RREF</strong> is for rurality.<br />
The need for HACC services arises when people experience <strong>on</strong>-going difficulties or need<br />
assistance in carrying out activities <strong>of</strong> daily living and participating in social and community<br />
life. Defining the HACC target populati<strong>on</strong>, therefore, requires a means <strong>of</strong> identifying those who<br />
experience such difficulties or who need assistance. Two further c<strong>on</strong>siderati<strong>on</strong>s need to be<br />
noted. First, as HACC services have a preventative functi<strong>on</strong>, it is necessary for this definiti<strong>on</strong> to<br />
include those who experience difficulties and are at risk <strong>of</strong> increasing dependency as well as<br />
those who already have a significant limitati<strong>on</strong> and need assistance. Sec<strong>on</strong>d, eligibility for<br />
HACC is based <strong>on</strong> dependency and need for assistance <strong>on</strong>ly, and fees are assessed <strong>on</strong>ly after a<br />
client’s need for support is assessed. Fees paid by many clients cover <strong>on</strong>ly part <strong>of</strong> the cost <strong>of</strong><br />
service, and <strong>on</strong>ly a relatively small proporti<strong>on</strong> pay full fees; using HACC services <strong>on</strong> a full fee<br />
paying basis or opting for an alternative provider, if there is <strong>on</strong>e available, is thus a choice for<br />
relatively few, and those paying full or part fees should c<strong>on</strong>tinue to have the opti<strong>on</strong> <strong>of</strong><br />
purchasing services from HACC providers.<br />
A number <strong>of</strong> reservati<strong>on</strong>s were expressed about the use <strong>of</strong> the DACS data for identifying the<br />
base populati<strong>on</strong> for the <strong>RREF</strong>. Frequently Asked Questi<strong>on</strong>s c<strong>on</strong>cerned the definiti<strong>on</strong>s used and<br />
methods and scope <strong>of</strong> the survey. While answers to most <strong>of</strong> these FAQs about technical aspects<br />
<strong>of</strong> the survey can be found in ABS reports <strong>on</strong> the DACS, these are not readily available in the<br />
field, and the comm<strong>on</strong> FAQs and resp<strong>on</strong>ses are included in Appendix 2.<br />
A further issue <strong>of</strong> particular c<strong>on</strong>cern was the adequacy <strong>of</strong> the DACS for identifying pers<strong>on</strong>s <strong>of</strong><br />
Koori background, due to the sample size, declarati<strong>on</strong> <strong>of</strong> Koori identificati<strong>on</strong> and cultural<br />
factors affecting expressi<strong>on</strong> <strong>of</strong> disability and need for assistance.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 16
Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
Notwithstanding these reservati<strong>on</strong>s, participants in c<strong>on</strong>sultati<strong>on</strong>s and those who made<br />
submissi<strong>on</strong>s accepted that the DACS might still be the best available data and hence remain the<br />
appropriate starting point. The Review team’s investigati<strong>on</strong>s c<strong>on</strong>firmed this view. Whilst a<br />
number <strong>of</strong> other studies <strong>of</strong> disability and service use were referred to through the c<strong>on</strong>sultati<strong>on</strong><br />
process, analysis by the c<strong>on</strong>sultants c<strong>on</strong>firmed that n<strong>on</strong>e <strong>of</strong> them capture the total populati<strong>on</strong> <strong>of</strong><br />
both users <strong>of</strong> services and those who do not currently access services as well as the DACS does.<br />
The DACS has a number <strong>of</strong> strengths that make it the most robust and best available data. No<br />
other data source was identified that could compare with the DACS <strong>on</strong> the following grounds:<br />
• it has the same high technical standards as the Census and other ABS Surveys.<br />
• it is populati<strong>on</strong> based, that is, it is collected from a sample <strong>of</strong> over 37,000 people in<br />
the community;<br />
• the sample covers the total populati<strong>on</strong>, and so is not restricted to just those who<br />
have been assessed or who are receiving services;<br />
• the DACS is widely used in planning <strong>of</strong> services for individuals with <strong>on</strong>-going and<br />
relatively stable disabilities and chr<strong>on</strong>ic health problems;<br />
• it is updated every five years;<br />
• comparis<strong>on</strong>s between the DACS and other available data sources (including<br />
Centrelink DSP Data) have found close agreement; and<br />
• the DACS collects data from pers<strong>on</strong>al interviews with younger people with<br />
disabilities, frail aged people and their carers and so captures c<strong>on</strong>sumer views.<br />
1.2 PREVALENCE OF CORE ACTIVITY RESTRICTION<br />
The term core activity restricti<strong>on</strong> or handicap is used throughout this <str<strong>on</strong>g>Report</str<strong>on</strong>g> as technical terms<br />
as used in the ABS surveys. A distincti<strong>on</strong> is first made between impairment, disability and<br />
handicap, and then moderate, severe and pr<strong>of</strong>ound levels <strong>of</strong> handicap or restricti<strong>on</strong> are<br />
determined. These definiti<strong>on</strong>s are set out in Appendix 2.<br />
The DACS provides both a statewide rate <strong>of</strong> disability and regi<strong>on</strong>al rates. The reliability <strong>of</strong> the<br />
regi<strong>on</strong>al rates is however far lower, and restricts the rates to <strong>on</strong>ly two age groups, under 70 and<br />
over 70. These limitati<strong>on</strong>s pose major difficulties when differences in age structure between<br />
LGAs, and changes in age structure over time, are significant factors in determining the size <strong>of</strong><br />
the base populati<strong>on</strong>s for the <strong>RREF</strong>.<br />
These limitati<strong>on</strong>s could <strong>on</strong>ly be fully overcome if data <strong>on</strong> the prevalence <strong>of</strong> different levels <strong>of</strong><br />
handicap, by age group, was available at the LGA level. It is precisely because such data are<br />
not available that a range <strong>of</strong> other factors have to be taken into account in the <strong>RREF</strong> as<br />
indicators <strong>of</strong> need. These indicators developed using LGA level data and are applied to the base<br />
populati<strong>on</strong> calculated for each LGA, and more accurate initial <strong>RREF</strong> base populati<strong>on</strong>s can be<br />
calculated using the statewide prevalence for each five year age group for the total populati<strong>on</strong><br />
than by using regi<strong>on</strong>al prevalence’s that are available for two very broad age groups.<br />
C<strong>on</strong>tinuing development <strong>of</strong> the DACS survey and other measures <strong>of</strong> prevalence <strong>of</strong> disability<br />
may provide alternative measures in the future.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 17
Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
1.3 POPULATION LIVING IN THE COMMUNITY ONLY<br />
As the <strong>RREF</strong> base populati<strong>on</strong> covers <strong>on</strong>ly the populati<strong>on</strong> with moderate, severe and pr<strong>of</strong>ound<br />
handicap living in the community, attenti<strong>on</strong> has to be given to the way in which the populati<strong>on</strong><br />
in aged residential care and disability supported accommodati<strong>on</strong> is excluded. While this issue<br />
was not an area <strong>of</strong> discussi<strong>on</strong> in the c<strong>on</strong>sultati<strong>on</strong>s and submissi<strong>on</strong>s, the Review recognised the<br />
need to revise the way this populati<strong>on</strong> is defined and excluded to take account <strong>of</strong> variati<strong>on</strong>s in<br />
access to residential care for both the aged and for younger people with disabilities at the local<br />
level.<br />
Informati<strong>on</strong> <strong>on</strong> the populati<strong>on</strong> in n<strong>on</strong>-private dwellings is collected in DACS through a survey<br />
<strong>of</strong> a sample <strong>of</strong> n<strong>on</strong>-private dwellings which are further divided into “cared accommodati<strong>on</strong>” and<br />
other n<strong>on</strong>-private dwellings. Cared accommodati<strong>on</strong> in turn includes hospitals, nursing homes<br />
and aged care hostels and other facilities including hostels for people with disabilities,<br />
children’s homes, drug rehabilitati<strong>on</strong> centres and some cared comp<strong>on</strong>ents <strong>of</strong> retirement villages.<br />
Three issues arise from the exclusi<strong>on</strong> <strong>of</strong> all those in n<strong>on</strong>-private dwellings:<br />
1. Neither the n<strong>on</strong>-private dwellings category nor the cared accommodati<strong>on</strong><br />
care sub-category corresp<strong>on</strong>d to the restricti<strong>on</strong> <strong>of</strong> the HACC target<br />
populati<strong>on</strong> to those living in the community, but rather include a mix <strong>of</strong><br />
people who are eligible and who are not eligible. Those who are in hospital<br />
at the time <strong>of</strong> the survey and who have lasting activity restricti<strong>on</strong>s will be<br />
eligible for HACC services <strong>on</strong> return to the community. Residents <strong>of</strong> some<br />
<strong>of</strong> the “other” forms <strong>of</strong> cared accommodati<strong>on</strong>, and “other n<strong>on</strong>-private<br />
dwellings”, notably residents in private supported residential services (SRS)<br />
and serviced apartments in retirement villages, may also be eligible for<br />
HACC. A closer alignment is required between facilities that are funded<br />
through the aged and disability residential care programs and the ABS<br />
definiti<strong>on</strong>s for the populati<strong>on</strong> living in the community and in various forms<br />
<strong>of</strong> supported accommodati<strong>on</strong>. Until this alignment is achieved, more<br />
accurate calculati<strong>on</strong>s <strong>of</strong> the <strong>RREF</strong> base populati<strong>on</strong> living in the community<br />
can be obtained by first estimating total handicapped populati<strong>on</strong>s for LGAs<br />
then deducting the actual numbers <strong>of</strong> people living in funded residential<br />
care facilities.<br />
2. All but 3,100 <strong>of</strong> the total 138,900 people in aged residential care facilities<br />
and “other” cared accommodati<strong>on</strong> had moderate or pr<strong>of</strong>ound levels <strong>of</strong><br />
handicap; this level <strong>of</strong> handicap reflects the requirements for assessment<br />
prior to admissi<strong>on</strong> to these facilities, and most <strong>of</strong> those with low levels <strong>of</strong><br />
handicap are spouses <strong>of</strong> more dependent people in aged care facilities. All<br />
<strong>of</strong> this populati<strong>on</strong> can effectively be taken as bel<strong>on</strong>ging to the moderately,<br />
severely and pr<strong>of</strong>oundly handicapped populati<strong>on</strong> and so is appropriately<br />
subtracted from the total LGA handicapped populati<strong>on</strong>s to give the balance<br />
living in the community. Data <strong>on</strong> residents in these facilities by age and<br />
LGA can now be obtained.<br />
3. Whereas the current <strong>RREF</strong> makes a “<strong>on</strong>e-<strong>of</strong>f” adjustment <strong>on</strong> a statewide<br />
basis and <strong>on</strong>ly at the time <strong>of</strong> the DACS survey, data <strong>on</strong> actual residential<br />
care populati<strong>on</strong>s can be obtained <strong>on</strong> an annual basis, and deducted in annual<br />
calculati<strong>on</strong>s <strong>of</strong> the <strong>RREF</strong> base populati<strong>on</strong>. The treatment <strong>of</strong> the populati<strong>on</strong><br />
in n<strong>on</strong>-private dwellings in the current <strong>RREF</strong> was dictated by the lack <strong>of</strong><br />
alternative data at the time, but is now unnecessarily complicated and less<br />
accurate than the use <strong>of</strong> data <strong>on</strong> actual residential care populati<strong>on</strong>s.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 18
Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
As the HACC target populati<strong>on</strong> includes <strong>on</strong>ly those living in the community, the next step in<br />
calculating the base populati<strong>on</strong> for the <strong>RREF</strong> is to subtract those in residential care. The opti<strong>on</strong><br />
now proposed is more straightforward and more accurate than the method used in the current<br />
<strong>RREF</strong>. The current method has a number <strong>of</strong> inc<strong>on</strong>sistencies which arise when applying the<br />
DACS statewide prevalence <strong>of</strong> handicap for the populati<strong>on</strong> in private dwellings <strong>on</strong>ly to the total<br />
LGA populati<strong>on</strong>s projected by DOI, and then subtracting those in the “cared accommodati<strong>on</strong>”<br />
comp<strong>on</strong>ent <strong>of</strong> n<strong>on</strong>-private dwellings, from age 85 years and over <strong>on</strong>ly. This limitati<strong>on</strong> stems<br />
from the restricted data available at the time the <strong>RREF</strong> was devised in 1992 and can now be<br />
addressed<br />
The DACS survey shows that virtually all those in the “cared accommodati<strong>on</strong>” comp<strong>on</strong>ent <strong>of</strong><br />
the populati<strong>on</strong> in n<strong>on</strong>-private dwellings have at least moderate levels <strong>of</strong> handicap. The actual<br />
populati<strong>on</strong> in residential care is most appropriately subtracted from the handicapped populati<strong>on</strong><br />
in each LGA rather than from the total LGA populati<strong>on</strong>.<br />
Exact figures <strong>on</strong> the populati<strong>on</strong> in aged residential care and in disability accommodati<strong>on</strong> are<br />
now available by LGA, and these numbers are subtracted from the initial <strong>RREF</strong> base populati<strong>on</strong><br />
for each LGA. The subtracti<strong>on</strong> is restricted to the populati<strong>on</strong> in residential care and does not<br />
include CACP places as CACPs draw <strong>on</strong> HACC services over and above those covered by<br />
CACP funding, notably for nursing care. The substantial increases in CACP places may<br />
warrant further c<strong>on</strong>siderati<strong>on</strong> in future.<br />
The total number <strong>of</strong> individuals aged under and over 70 with moderate, severe or pr<strong>of</strong>ound<br />
levels <strong>of</strong> handicap, the numbers in residential aged care and disability accommodati<strong>on</strong>, and the<br />
balance living in the community are detailed in Table 1.1.<br />
Table 1.1: Comp<strong>on</strong>ents <strong>of</strong> HACC Base Populati<strong>on</strong>, 2002<br />
Populati<strong>on</strong> comp<strong>on</strong>ent<br />
Aged<br />
under 70<br />
Aged 70<br />
and over<br />
Total<br />
Total populati<strong>on</strong> 4,358,102 449,726 4,807,828<br />
Total with moderate, severe and pr<strong>of</strong>ound 286,218 162,897 449,115<br />
handicap<br />
Living in cared accommodati<strong>on</strong> 4,615 38,791 43,406<br />
Living in community 281,603 124,106 405,709<br />
1.4 ADJUSTING FOR THE FRAIL AGED COMPONENT OF THE HACC TARGET<br />
POPULATION<br />
A diversity <strong>of</strong> views about the need to adjust for the frail aged comp<strong>on</strong>ent <strong>of</strong> the HACC target<br />
populati<strong>on</strong>, and how to make this adjustment, were expressed in the c<strong>on</strong>sultati<strong>on</strong>s and<br />
submissi<strong>on</strong>s. This decisi<strong>on</strong> is informed by examinati<strong>on</strong> <strong>of</strong> the level <strong>of</strong> handicap in the<br />
populati<strong>on</strong> under and over age 70, as detailed in Table 1.2.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 19
Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
Table 1.2: Level <strong>of</strong> activity restricti<strong>on</strong>, for populati<strong>on</strong> under and over 70 years, in<br />
Private Dwellings <strong>on</strong>ly, 1998 DACS<br />
Level <strong>of</strong> activity Under 70 Over 70 Total<br />
restricti<strong>on</strong><br />
‘000 % ‘000 % ‘000 %<br />
Moderate 107.5 41.0 36.9 35.1 144.4 39.4<br />
Severe 104.5 40.0 24.4 23.5 128.9 35.2<br />
Pr<strong>of</strong>ound 49.5 19.0 43.7 41.6 93.2 25.4<br />
Total 261.5 100.0 105.0 100.0 366.5 100<br />
These data also point to the justificati<strong>on</strong> for and possible opti<strong>on</strong>s for making different<br />
adjustments for the frail aged as follows:<br />
• A higher proporti<strong>on</strong> <strong>of</strong> the handicapped populati<strong>on</strong> at older ages have a higher level<br />
<strong>of</strong> activity restricti<strong>on</strong>, with 41.6% having pr<strong>of</strong>ound restricti<strong>on</strong>, whereas moderate<br />
levels <strong>of</strong> restricti<strong>on</strong> dominate at younger ages and <strong>on</strong>ly 19% have a pr<strong>of</strong>ound<br />
restricti<strong>on</strong>.<br />
• Adjusting <strong>on</strong> the basis <strong>of</strong> disability rather than age per se maintains the focus <strong>of</strong> the<br />
HACC target populati<strong>on</strong> definiti<strong>on</strong> <strong>on</strong> those in need <strong>of</strong> help with activities <strong>of</strong> daily<br />
living.<br />
• Victoria presently has lower levels <strong>of</strong> aged residential care and an increasing<br />
number and degree <strong>of</strong> frail older people who will need to be supported in the<br />
community as aged residential care provisi<strong>on</strong> trends downwards to reach the<br />
Comm<strong>on</strong>wealth planning ratios by around 2005-06.<br />
Reflecting these increasing levels <strong>of</strong> restricti<strong>on</strong>, the frail aged comp<strong>on</strong>ent <strong>of</strong> the base populati<strong>on</strong><br />
makes much higher use <strong>of</strong> HACC services, with those aged 70 and over accounting for around<br />
70% <strong>of</strong> the HACC client populati<strong>on</strong>. Younger people with disabilities make less use <strong>of</strong> HACC<br />
but receive services from programs operating under the Comm<strong>on</strong>wealth-State Disability<br />
Agreement. Figure 2 compares the age distributi<strong>on</strong>s for the total populati<strong>on</strong> with moderate,<br />
severe or pr<strong>of</strong>ound levels <strong>of</strong> handicap as identified by the DACS, the HACC client populati<strong>on</strong><br />
and the users <strong>of</strong> Disability Services in Victoria.<br />
Figure 2: Comparis<strong>on</strong> <strong>of</strong> Age Distributi<strong>on</strong> <strong>of</strong> DACS populati<strong>on</strong>,<br />
Disability Program Clients and HACC Clients<br />
25<br />
20<br />
DACS<br />
Disability Program Clients<br />
%<br />
15<br />
HACC Clients<br />
10<br />
5<br />
0<br />
0-4 5-14 15-24 25-34 35-44 45-54 55-59 60-64 65-69 70-74 75-79 80-84 85+<br />
Age Group<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 20
Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
Three opti<strong>on</strong>s emerged as alternatives to maintaining the current <strong>RREF</strong> opti<strong>on</strong> <strong>of</strong> including all<br />
those aged 85 and over living in the community:<br />
1. Include <strong>on</strong>ly those with moderate, severe and pr<strong>of</strong>ound handicap at all<br />
ages. The basis for not making any further adjustment for advanced<br />
age is that the frail aged could be defined as those with handicaps and<br />
so those who do not have a handicap are not part <strong>of</strong> the HACC target<br />
populati<strong>on</strong>.<br />
2. Lower the age for defining the frail aged to 70 years and over to reflect<br />
the predominance <strong>of</strong> this age group in the HACC client populati<strong>on</strong>.<br />
One advantage that could be claimed for this approach is c<strong>on</strong>sistency<br />
with the aged residential care planning ratios; however, those ratios<br />
apply <strong>on</strong>ly to the aged populati<strong>on</strong>, so the issue <strong>of</strong> relativity to younger<br />
age groups does not apply. The disadvantage <strong>of</strong> this opti<strong>on</strong> is that it<br />
includes a substantial number <strong>of</strong> older people who are not within the<br />
HACC target populati<strong>on</strong> because they do not require assistance in daily<br />
living activities and for social participati<strong>on</strong>. While the total aged<br />
populati<strong>on</strong> comes within the scope <strong>of</strong> health promoti<strong>on</strong> programs,<br />
primary preventi<strong>on</strong> is bey<strong>on</strong>d the scope <strong>of</strong> HACC.<br />
3. Give additi<strong>on</strong>al weight to the moderately, severely and pr<strong>of</strong>oundly<br />
handicapped populati<strong>on</strong> aged 70 and over. Figure 2 gives a guide to<br />
added weight that would bring the frail aged populati<strong>on</strong> identified by<br />
DACS more into line with the representati<strong>on</strong> <strong>of</strong> older age groups in the<br />
HACC client populati<strong>on</strong>, which shows that shares <strong>of</strong> the HACC client<br />
populati<strong>on</strong> in the age groups over 70 are approximately double their<br />
shares <strong>of</strong> the DACS populati<strong>on</strong>. Accordingly, this segment <strong>of</strong> the base<br />
populati<strong>on</strong> has been doubled in the third opti<strong>on</strong>. This opti<strong>on</strong> has the<br />
advantages <strong>of</strong> c<strong>on</strong>sistently defining the target populati<strong>on</strong> <strong>on</strong> the basis <strong>of</strong><br />
disability, and focusing <strong>on</strong> the sec<strong>on</strong>dary preventi<strong>on</strong> functi<strong>on</strong>s <strong>of</strong><br />
HACC for a client populati<strong>on</strong> with established disability.<br />
The effects <strong>on</strong> the age balance <strong>of</strong> the total base populati<strong>on</strong> arising from adjusting for the frail<br />
aged in the current <strong>RREF</strong> and these three opti<strong>on</strong>s can be seen in Table 1.3 which compares:<br />
• the numbers and proporti<strong>on</strong>s aged under and over 70 for the total Victorian<br />
populati<strong>on</strong>;<br />
• the HACC client populati<strong>on</strong> under and over 70;<br />
• the current <strong>RREF</strong>; and<br />
• the three opti<strong>on</strong>s for <strong>RREF</strong> base populati<strong>on</strong>s calculated <strong>on</strong> the statewide prevalence<br />
<strong>of</strong> moderate, severe and pr<strong>of</strong>ound handicap and with different adjustments for the<br />
frail aged.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 21
Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
Table 1.3: Comparis<strong>on</strong>s <strong>of</strong> Base Populati<strong>on</strong> Opti<strong>on</strong>s for adjusting for Frail Aged<br />
Populati<strong>on</strong> Under 70 Over 70 Total<br />
% % No. ‘000<br />
Total Victorian populati<strong>on</strong> <strong>2001</strong> 91 9 4,770.4<br />
HACC Client populati<strong>on</strong> ~30 ~70<br />
<strong>RREF</strong> 92: Handicap to age 85 in community plus total 68 32 383.4<br />
85 and over in community<br />
Opti<strong>on</strong> 1: Handicap at all ages in community, no<br />
71 29 366.6<br />
adjustment for frail aged<br />
Opti<strong>on</strong> 2: Handicap to age 70, plus total 70 and over, 42 58 626.4<br />
in community<br />
Opti<strong>on</strong> 3: Handicap to age 70, plus handicap aged 70<br />
and over, in community, doubled.<br />
55 45 471.6<br />
The figures in Table 1.3 are based <strong>on</strong> the 1998 DACS populati<strong>on</strong> in private dwellings <strong>on</strong>ly and<br />
so do not corresp<strong>on</strong>d exactly with figures for <strong>RREF</strong> base populati<strong>on</strong>s given later in this <str<strong>on</strong>g>Report</str<strong>on</strong>g>.<br />
In the base populati<strong>on</strong>s discussed below, <strong>on</strong>ly residential aged care and disability<br />
accommodati<strong>on</strong> and not other forms <strong>of</strong> n<strong>on</strong>-private dwellings have been subtracted, and other<br />
adjustments have been also made as detailed below.<br />
As both Opti<strong>on</strong>s 2 and 3 give added weight to the populati<strong>on</strong> aged 70 and over it is important to<br />
identify the potential impact <strong>of</strong> this adjustment across the state. Overall, 9% <strong>of</strong> Victoria’s<br />
populati<strong>on</strong> was aged 70 and over in <strong>2001</strong>, but there are wide variati<strong>on</strong>s between LGAs. Melt<strong>on</strong><br />
has the lowest proporti<strong>on</strong> aged 70 and over, just 3.5% and Queenscliffe the highest, 21.0%. Of<br />
the 78 LGAs, 30 have less than 9% aged 70 and over, and 20 <strong>of</strong> these are metropolitan LGAs.<br />
Of the 48 LGAs which have more than 9% aged 70 and over, 37 are rural LGAs. However,<br />
even though more rural LGAs are older than metropolitan areas, the majority <strong>of</strong> the older<br />
populati<strong>on</strong> live in metropolitan areas. The proporti<strong>on</strong> aged 70 and over is mapped in Figure 3.<br />
As weighting <strong>of</strong> base populati<strong>on</strong>s takes the absolute numbers <strong>of</strong> older people into account, the<br />
outcomes reflect the actual numbers <strong>of</strong> older people in any LGA rather than just the proporti<strong>on</strong><br />
they comprise <strong>of</strong> the total populati<strong>on</strong>. Thus, while Queenscliff has the highest proporti<strong>on</strong> aged<br />
70 and over, it has the third smallest number <strong>of</strong> aged resident, less than 500 people. At the same<br />
time, over <strong>on</strong>e third <strong>of</strong> the all those aged 70 and over live in just eight large metropolitan LGAs<br />
which each have over 14,000 aged residents, together with Greater Geel<strong>on</strong>g.<br />
These differences in the distributi<strong>on</strong> <strong>of</strong> the populati<strong>on</strong> aged 70 and over are amplified in Opti<strong>on</strong>s<br />
2 and 3 in somewhat different ways. Opti<strong>on</strong> 2 gives increased weight to the populati<strong>on</strong> aged 70<br />
and over directly by counting all aged 70 and over in. Doubling <strong>of</strong> the handicapped populati<strong>on</strong><br />
aged 70 and over in Opti<strong>on</strong> 3 gives more weight to the oldest age groups as rates <strong>of</strong> handicap<br />
increase with advancing age. In Opti<strong>on</strong> 3, the total handicapped populati<strong>on</strong> aged 70 and over is<br />
doubled before any <strong>of</strong> the other populati<strong>on</strong> comp<strong>on</strong>ents are subtracted. The effect is then to<br />
discount the subtracti<strong>on</strong>s by 50%, and this is seen to be c<strong>on</strong>sistent with allowing some<br />
c<strong>on</strong>tinuing use <strong>of</strong> HACC services by these populati<strong>on</strong> segments as discussed further below.<br />
1.5 OTHER EXCLUSIONS<br />
The implementati<strong>on</strong> <strong>of</strong> the Veterans’ Home Care Program in early <strong>2001</strong> was identified as<br />
having the potential to alleviate demand for HACC services as it removes eligible veterans from<br />
the HACC target populati<strong>on</strong>. The number <strong>of</strong> veterans estimated to be eligible for the VHC in<br />
early <strong>2001</strong> was 67,766. The way in which the veteran populati<strong>on</strong> should be recognised was an<br />
area <strong>of</strong> c<strong>on</strong>siderable discussi<strong>on</strong> in the Round 2 C<strong>on</strong>sultati<strong>on</strong>s and this matter is taken up below.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 22
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 23
Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
1.6 SUMMARY OF OPTIONS FOR DEFINING THE <strong>RREF</strong> BASE POPULATION<br />
The opti<strong>on</strong>s identified for the five elements <strong>of</strong> the definiti<strong>on</strong> <strong>of</strong> the <strong>RREF</strong> base populati<strong>on</strong> are<br />
summarised below. The Round 2 C<strong>on</strong>sultati<strong>on</strong>s sought views <strong>on</strong> these opti<strong>on</strong>s.<br />
What are the<br />
opti<strong>on</strong>s for data<br />
for defining<br />
populati<strong>on</strong> in<br />
need <strong>of</strong> HACC<br />
services?<br />
What are the<br />
opti<strong>on</strong>s for<br />
prevalence <strong>of</strong><br />
handicap?<br />
What are the<br />
opti<strong>on</strong>s for<br />
defining the<br />
populati<strong>on</strong> in<br />
the community?<br />
What are the<br />
opti<strong>on</strong>s for<br />
adjusting for the<br />
frail aged?<br />
What are the opti<strong>on</strong>s<br />
for other exclusi<strong>on</strong>s?<br />
! C<strong>on</strong>tinued use <strong>of</strong> data from the ABS Disability, Ageing and<br />
Carers Survey for defining the HACC Base Populati<strong>on</strong> is the<br />
identified opti<strong>on</strong> at this time.<br />
! Rec<strong>on</strong>sider should alternative data bases become available in<br />
future<br />
! The identified opti<strong>on</strong> is to prepare initial Base Populati<strong>on</strong>s<br />
using:<br />
! statewide rates <strong>of</strong> prevalence <strong>of</strong> handicap to calculate the<br />
number <strong>of</strong> people in each age group with a moderate, severe<br />
or pr<strong>of</strong>ound handicap in each LGA,<br />
! using the LGA populati<strong>on</strong>s projected by DOI.<br />
! To obtain the handicapped populati<strong>on</strong> living in the community,<br />
the identified opti<strong>on</strong> is to subtract the following groups from<br />
each LGA initial base populati<strong>on</strong>:<br />
! actual residents in residential aged care<br />
! residents in disability accommodati<strong>on</strong><br />
! Further c<strong>on</strong>siderati<strong>on</strong> to be given to CACP places in future.<br />
! Which <strong>of</strong> the following do you c<strong>on</strong>sider the most suitable base<br />
populati<strong>on</strong> for the <strong>RREF</strong>?<br />
! <strong>RREF</strong>92- adjustment <strong>of</strong> inclusi<strong>on</strong> <strong>of</strong> total populati<strong>on</strong> in the<br />
community aged 85 and over,<br />
! Opti<strong>on</strong>s for adjusting for the frail aged.<br />
! Which opti<strong>on</strong> do you prefer for adjusting for the frail aged:<br />
! Include <strong>on</strong>ly the moderately, severely and pr<strong>of</strong>oundly<br />
handicapped at all ages;<br />
! Include all those aged 70 and over;<br />
! Double the number <strong>of</strong> moderately, severely and pr<strong>of</strong>oundly<br />
handicapped aged 70 and over in recogniti<strong>on</strong> <strong>of</strong> higher rate <strong>of</strong><br />
pr<strong>of</strong>ound handicap.<br />
! Should the actual number <strong>of</strong> veterans aged 70 and over eligible<br />
for the Veterans’ Home Care Program in each LGA be subtracted<br />
from the <strong>RREF</strong> base populati<strong>on</strong>?<br />
! Are there any further exclusi<strong>on</strong>s that should be c<strong>on</strong>sidered?<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 24
Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
1.7 FURTHER ISSUES AND PREFERRED OPTIONS<br />
1. Data for defining the populati<strong>on</strong> in need <strong>of</strong> HACC services<br />
The c<strong>on</strong>cerns expressed in the Round 1 c<strong>on</strong>sultati<strong>on</strong>s regarding use <strong>of</strong> the DACS data<br />
were substantially addressed in the Opti<strong>on</strong>s Paper. As well as providing answers to a<br />
number <strong>of</strong> Frequently Asked Questi<strong>on</strong>s about the DAC survey, as detailed in Appendix<br />
2, a number <strong>of</strong> strengths <strong>of</strong> the DAC survey data set out in the Opti<strong>on</strong>s Paper were<br />
acknowledged in the field.<br />
No further issues were identified in the Round 2 c<strong>on</strong>sultati<strong>on</strong>s, but the need for <strong>on</strong>going<br />
input <strong>of</strong> DHS and HACC providers to the development <strong>of</strong> the 2003 DACS was<br />
emphasised.<br />
2. Opti<strong>on</strong>s for prevalence <strong>of</strong> handicap<br />
Use <strong>of</strong> the statewide prevalence was accepted as providing the most robust estimates to<br />
which weightings for need could be applied.<br />
No further issues were identified.<br />
3. Populati<strong>on</strong> living in community – exclusi<strong>on</strong> <strong>of</strong> residential care<br />
populati<strong>on</strong><br />
Exclusi<strong>on</strong> <strong>of</strong> the populati<strong>on</strong> in aged residential care facilities and disability<br />
accommodati<strong>on</strong> was agreed, with the proviso that the latest available data <strong>on</strong> actual<br />
residents in these facilities be used rather than approved beds, which included beds<br />
approved in principle but not yet in operati<strong>on</strong>. The relevant data for disability services<br />
is available from DHS and has been sought for aged residential care from the<br />
Comm<strong>on</strong>wealth.<br />
Some c<strong>on</strong>cerns were expressed about the historical pattern <strong>of</strong> supply <strong>of</strong> residential care<br />
leading to movement from <strong>on</strong>e local area to another. Such movement is however taken<br />
into account as both residents in facilities and community residents are counted in the<br />
LGA in which they are located at the time they are receiving either form <strong>of</strong> care.<br />
There was general agreement that CACPs and other State-funded packages for younger<br />
people with disabilities should not be subtracted given that clients in receipt <strong>of</strong> packages<br />
may still use some HACC services not funded as part <strong>of</strong> their package, notably nursing.<br />
The use <strong>of</strong> some community service by residents in aged care hostels and disability<br />
accommodati<strong>on</strong> was recognised. There is some trade <strong>of</strong>f here, as clients receiving<br />
CACPs are not deducted. Further, the deducti<strong>on</strong> <strong>of</strong> the residential aged care populati<strong>on</strong><br />
after doubling the frail aged populati<strong>on</strong> in Base 3 has the effect <strong>of</strong> discounting that<br />
populati<strong>on</strong> by <strong>on</strong>ly 50% and so gives some recogniti<strong>on</strong> to c<strong>on</strong>tinued use <strong>of</strong> HACC<br />
services by residents. Further c<strong>on</strong>siderati<strong>on</strong> also needs to be given to recogniti<strong>on</strong> <strong>of</strong> the<br />
local impact <strong>of</strong> different kinds <strong>of</strong> residential care services <strong>on</strong> HACC in regi<strong>on</strong>al and<br />
local planning.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 25
4. Adjustment for the frail aged<br />
Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
Clarificati<strong>on</strong> was sought as to the rati<strong>on</strong>ale for doubling the populati<strong>on</strong> aged<br />
70+ with core activity restricti<strong>on</strong>s in Base 3. As well as reiterating the<br />
discussi<strong>on</strong> in the Opti<strong>on</strong>s Paper, the need to achieve a better match between the<br />
<strong>RREF</strong> Base Populati<strong>on</strong> and the share <strong>of</strong> the HACC client populati<strong>on</strong> aged 70+<br />
was dem<strong>on</strong>strated by reference to Figure 2 above which shows the age<br />
distributi<strong>on</strong> <strong>of</strong> the populati<strong>on</strong> with core activity restricti<strong>on</strong>s reported in the<br />
DACS, the HACC client populati<strong>on</strong> and the Disability Program client<br />
populati<strong>on</strong>. This graph shows that compared to the DACS populati<strong>on</strong> overall,<br />
disability service clients are predominantly in younger age groups and HACC<br />
clients are predominantly in the older age groups. Doubling the frail aged<br />
comp<strong>on</strong>ent <strong>of</strong> the DACS populati<strong>on</strong> takes account <strong>of</strong> the greater propensity <strong>of</strong><br />
frail aged individuals to use HACC services whereas younger people with<br />
disabilities are more likely to use the range <strong>of</strong> other services provided through<br />
disability programs such as educati<strong>on</strong>al, training and employment services.<br />
Achieving a better match in terms <strong>of</strong> the proporti<strong>on</strong> <strong>of</strong> clients in different age<br />
groups does not take account <strong>of</strong> the actual proporti<strong>on</strong> <strong>of</strong> services that they use<br />
or the durati<strong>on</strong> <strong>of</strong> service use. Rather than increasing the frail aged comp<strong>on</strong>ent<br />
<strong>of</strong> the target populati<strong>on</strong> to achieve an exact match with the share <strong>of</strong> the HACC<br />
client populati<strong>on</strong>, doubling the frail aged was seen to make a sufficient albeit<br />
somewhat arbitrary adjustment.<br />
While inclusi<strong>on</strong> <strong>of</strong> the total populati<strong>on</strong> aged 70+ in Base 2 was seen to<br />
acknowledge the preventative functi<strong>on</strong>s <strong>of</strong> HACC, it has to be stressed that<br />
health promoti<strong>on</strong> for older people in general is the c<strong>on</strong>cern <strong>of</strong> populati<strong>on</strong> based<br />
health promoti<strong>on</strong> programs, initiatives such as the <strong>Health</strong> Promoti<strong>on</strong> for Older<br />
Pers<strong>on</strong>s Program, and other priority initiatives such as influenza immunisati<strong>on</strong><br />
for older people, which provide both primary and sec<strong>on</strong>dary preventi<strong>on</strong>, and<br />
other rehabilitati<strong>on</strong> programs for tertiary preventi<strong>on</strong>. Successful outcomes <strong>of</strong><br />
these programs should over time moderate the demand for HACC services to<br />
some extent. The preventative comp<strong>on</strong>ent <strong>of</strong> HACC is focused <strong>on</strong> sec<strong>on</strong>dary<br />
preventi<strong>on</strong>, that is, maintaining functi<strong>on</strong> am<strong>on</strong>g a populati<strong>on</strong> with already<br />
established activity restricti<strong>on</strong>s. At the same time, it needs to be recognised that<br />
the opportunity for early interventi<strong>on</strong> through HACC is not precluded as the<br />
ABS definiti<strong>on</strong> <strong>of</strong> “moderate” activity restricti<strong>on</strong> is not unduly restrictive; the<br />
base populati<strong>on</strong> defined <strong>on</strong> the basis <strong>of</strong> DACS definiti<strong>on</strong> <strong>of</strong> those with moderate<br />
restricti<strong>on</strong>s covers those who have difficulty in performing an activity,<br />
including those who can carry out activities <strong>on</strong>ly with the use <strong>of</strong> aids, as well as<br />
those with severe or pr<strong>of</strong>ound restricti<strong>on</strong>s who respectively sometimes or<br />
always need assistance (see Appendix 2 for details <strong>of</strong> DACS definiti<strong>on</strong>s).<br />
The use <strong>of</strong> the total populati<strong>on</strong> aged 70+ in residential care planning rather than<br />
the aged populati<strong>on</strong> with moderate, severe and pr<strong>of</strong>ound handicaps, or even<br />
<strong>on</strong>ly those with pr<strong>of</strong>ound and severe handicap has been the subject <strong>of</strong> some<br />
debate. Estimates <strong>of</strong> bed requirements based <strong>on</strong> these different populati<strong>on</strong>s<br />
made by the AIHW (1995) however show that higher ratios based <strong>on</strong><br />
progressively smaller specific age groups over the older age range tend to<br />
balance out with the present ratios for the larger populati<strong>on</strong> aged 70 and over.<br />
Of more relevance to the <strong>RREF</strong> base populati<strong>on</strong> is the fact that the residential<br />
care planning processes apply <strong>on</strong>ly to the aged populati<strong>on</strong> so the issue <strong>of</strong> having<br />
to measure relative need across younger and older age groups does not arise.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 26
Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
Compared to inclusi<strong>on</strong> <strong>of</strong> the total populati<strong>on</strong> aged 70 and over in Base 2,<br />
adjustment for the frail aged by doubling the DACS handicapped populati<strong>on</strong><br />
aged 70+ in Base 3 was seen to give a better match to the actual HACC client<br />
populati<strong>on</strong> as it reflects the definiti<strong>on</strong> <strong>of</strong> the HACC target populati<strong>on</strong> and broad<br />
eligibility criteria relating to need for assistance, and allows for attenti<strong>on</strong> to<br />
sec<strong>on</strong>dary preventi<strong>on</strong> am<strong>on</strong>g those with some level <strong>of</strong> activity restricti<strong>on</strong>.<br />
Balancing the discussi<strong>on</strong> <strong>of</strong> adjustments for the frail aged, some issues<br />
c<strong>on</strong>cerning the way in which younger people with disabilities were covered in<br />
the base populati<strong>on</strong> were raised:<br />
The c<strong>on</strong>cern that adjustment for the frail aged would disadvantage LGAs and<br />
regi<strong>on</strong>s areas with relatively lower proporti<strong>on</strong>s aged 70+ in the populati<strong>on</strong> was<br />
addressed by the age specific rates <strong>of</strong> handicap being applied to the underlying<br />
age structure, so that relatively larger younger age cohorts would be taken into<br />
account.<br />
It was also noted that 0-4 age group were included in the 1998 DACS, but not<br />
in the 1993 survey.<br />
5. Veterans eligible for DVA Veterans’ Home Care Program (VHC)<br />
Views as to how veterans eligible for the VHC should be taken into account<br />
showed a marked shift between the two rounds <strong>of</strong> c<strong>on</strong>sultati<strong>on</strong>s. At the time <strong>of</strong><br />
the Round 1 C<strong>on</strong>sultati<strong>on</strong>s, in November-December 2000, arrangements for the<br />
VHC had not been finalised, but by March-April <strong>2001</strong>, implementati<strong>on</strong> had<br />
commenced and providers’ actual and anticipated experiences were coming into<br />
play.<br />
The resources that VHC can add in Victoria for service provisi<strong>on</strong> to some<br />
67,700 eligible veterans, not all <strong>of</strong> whom will be service users at any <strong>on</strong>e time,<br />
are close to the total annual growth funds for HACC which have to be spread<br />
across the total target populati<strong>on</strong>, am<strong>on</strong>g which there is a recognised level <strong>of</strong><br />
unmet need. Notwithstanding the service limits specified in the VHC<br />
guidelines, access to VHC resources has the capacity to provide eligible<br />
veterans with levels <strong>of</strong> service at least comparable to existing HACC services<br />
and in doing so, would free HACC resources for other clients. In c<strong>on</strong>sidering<br />
how veterans should be taken into account in the base populati<strong>on</strong>, it is useful to<br />
separate the resource issues <strong>of</strong> relevance to the <strong>RREF</strong> as a resource allocati<strong>on</strong><br />
formula from the practical issues <strong>of</strong> implementati<strong>on</strong> <strong>of</strong> VHC that were raised by<br />
providers in the Round 2 c<strong>on</strong>sultati<strong>on</strong>s.<br />
Implementati<strong>on</strong> issues: The view that veterans eligible for VHC should not be<br />
subtracted from the <strong>RREF</strong> base populati<strong>on</strong> reflected the early implementati<strong>on</strong><br />
phase <strong>of</strong> the program. While there was cauti<strong>on</strong> overall about the rate <strong>of</strong><br />
progress with implementati<strong>on</strong>, and the proporti<strong>on</strong> <strong>of</strong> existing veteran clients<br />
who would opt to switch to VHC, it was evident that as well as encountering<br />
some problems, providers were reaching satisfactory soluti<strong>on</strong>s, suggesting that<br />
early uncertainties could be ir<strong>on</strong>ed out in time. Several suggesti<strong>on</strong>s were put<br />
forward for promoting take up <strong>of</strong> VHC by way <strong>of</strong> positive presentati<strong>on</strong> <strong>of</strong><br />
opti<strong>on</strong>s to veteran clients, especially c<strong>on</strong>tinuity <strong>of</strong> direct care staff, and other<br />
practical matters. Negotiati<strong>on</strong>s between DVA, DHS, the Municipal Associati<strong>on</strong><br />
<strong>of</strong> Victoria and other provider bodies also has a part to play in facilitating<br />
implementati<strong>on</strong>, as would the VHC evaluati<strong>on</strong> process.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 27
Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
Resource issues: Focusing <strong>on</strong> resource issues, participants in the Round 2<br />
c<strong>on</strong>sultati<strong>on</strong>s acknowledged that it was important that VHC resources were<br />
used to the best advantage, and that fuller take up would be realised by January<br />
2002 when funding under any revised <strong>RREF</strong> would come into effect. Making<br />
an adjustment for the veteran populati<strong>on</strong> in the <strong>RREF</strong> base populati<strong>on</strong> was also<br />
seen as an incentive for providers to maximise take up <strong>of</strong> VHC am<strong>on</strong>g eligible<br />
clients. A further reas<strong>on</strong> for excluding veterans eligible for VHC was that this<br />
populati<strong>on</strong> is very unevenly distributed and if no adjustment was made, it was<br />
argued that providers in areas with large veteran populati<strong>on</strong>s would be able to<br />
“double dip” with access to HACC funds and VHC funds, while those in areas<br />
with fewer veterans would be penalised.<br />
Given that the <strong>RREF</strong> is essentially c<strong>on</strong>cerned with resource allocati<strong>on</strong>, and<br />
VHC provides additi<strong>on</strong>al resources for HACC type services, and taking account<br />
<strong>of</strong> the time interval to implementati<strong>on</strong> <strong>of</strong> any revised <strong>RREF</strong>, it is proposed to<br />
subtract eligible veterans from the <strong>RREF</strong> base populati<strong>on</strong>. Modelling has<br />
proceeded <strong>on</strong> this basis, but there will be opportunity to review the adjustment<br />
for the VHC eligible populati<strong>on</strong> when any new <strong>RREF</strong> is implemented. As the<br />
numbers <strong>of</strong> veterans eligible for VHC will change from year to year, this data<br />
will have to be updated annually and there will be opportunity for further<br />
review.<br />
Three further c<strong>on</strong>siderati<strong>on</strong>s are:<br />
! Deducti<strong>on</strong> <strong>of</strong> the eligible veteran populati<strong>on</strong> after the doubling <strong>of</strong> the frail aged<br />
in Base 3 has the effect <strong>of</strong> discounting by 50% and so allows for some<br />
c<strong>on</strong>tinuing use <strong>of</strong> HACC services by veterans who are eligible for the HVC.<br />
! Under a c<strong>on</strong>tinuati<strong>on</strong> <strong>of</strong> the current <strong>RREF</strong> some adjustment would be made for<br />
VHC clients and funding.<br />
! The veteran populati<strong>on</strong> is now ageing rapidly and the populati<strong>on</strong> excluded from<br />
the <strong>RREF</strong> base populati<strong>on</strong>s will need to be updated annually with data from<br />
DVA.<br />
6. Other issues<br />
Shortfall in Residential Care<br />
The Opti<strong>on</strong>s Paper presented initial opti<strong>on</strong>s that included the shortfall in<br />
residential care in the <strong>RREF</strong> as a need variable. The shortfall in each LGA was<br />
measured as the difference between the operati<strong>on</strong>al beds and the number <strong>of</strong><br />
beds that the LGA should have <strong>on</strong> the basis <strong>of</strong> the target ratio <strong>of</strong> 90 beds per<br />
1000; most <strong>of</strong> the shortfall comprises hostel places. A number <strong>of</strong> c<strong>on</strong>ceptual<br />
and practical issues that posed difficulties in dealing with the shortfall in this<br />
way were however noted. The alternative <strong>of</strong> taking the residential care shortfall<br />
into account in the base populati<strong>on</strong> was then c<strong>on</strong>sidered, but many <strong>of</strong> the same<br />
problems remained. Three sets <strong>of</strong> issues were identified in the Opti<strong>on</strong>s Paper<br />
and in the Round 2 C<strong>on</strong>sultati<strong>on</strong>s.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 28
Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
Measurement and apporti<strong>on</strong>ing <strong>of</strong> shortfall to LGAs:<br />
• Almost half the LGAs had an excess <strong>of</strong> residential care places, 32 out <strong>of</strong> 78,<br />
and <strong>on</strong>ly 13 had a shortfall in excess <strong>of</strong> 20 per 1000. This skewed<br />
distributi<strong>on</strong> and whether to take the shortfall into account as a ratio per<br />
1000 populati<strong>on</strong> aged 70 and over, or as an absolute number, posed<br />
problems for scaling as a need variable.<br />
• There were also difficulties in measuring the shortfall as the difference<br />
between operati<strong>on</strong>al beds and the target ratio at any <strong>on</strong>e time, given a<br />
c<strong>on</strong>siderable degree <strong>of</strong> flux in the sector at present. With a large number <strong>of</strong><br />
approvals in principal in existence, the rate at which AIPs come <strong>on</strong> stream<br />
is critical, but is not known with any certainty and when blocks <strong>of</strong> around<br />
30 beds come <strong>on</strong> stream at a time, the impact <strong>on</strong> the shortfall is marked, and<br />
occurs in a short time.<br />
• The shortfall is extremely uneven geographically, with some LGAs having<br />
persisting shortfalls while others have beds in excess <strong>of</strong> the ratio. While no<br />
penalty would be imposed for excess beds, <strong>on</strong>ly a small number <strong>of</strong> LGAs<br />
would receive a medium to high weighting <strong>on</strong> this need variable and so it<br />
make <strong>on</strong>ly a small c<strong>on</strong>tributi<strong>on</strong> to overall need weighting.<br />
• Difficulties were encountered in obtaining timely data <strong>on</strong> actual operati<strong>on</strong>al<br />
beds from the Comm<strong>on</strong>wealth for comparis<strong>on</strong> with the target numbers.<br />
Impact <strong>of</strong> shortfall <strong>on</strong> HACC<br />
• A detailed analysis was made <strong>of</strong> several factors related to how the<br />
residential care shortfall affected the need for HACC services and how this<br />
variable should be included in the <strong>RREF</strong>. These factors included whether<br />
high and low care should be separated; whether CACPs should be included:<br />
the distributi<strong>on</strong> <strong>of</strong> the shortfall across LGAs; whether shortfalls in some<br />
LGAs were balanced by excess provisi<strong>on</strong> in adjacent LGAs; and difficulties<br />
in projecting <strong>on</strong> the basis <strong>of</strong> existing shortfalls as approved beds coming<br />
into operati<strong>on</strong> in the next five years will be c<strong>on</strong>centrated in areas <strong>of</strong> greatest<br />
shortfall.<br />
• While the shortfall <strong>of</strong> beds has a pr<strong>on</strong>ounced impact in the LGAs<br />
c<strong>on</strong>cerned, it is evident that excess beds in some LGAs may balance<br />
shortfalls in some adjoining LGAs, but not in all cases, but this effect<br />
cannot be readily taken into account. “Excess” beds arise mostly in LGAs<br />
where public sector facilities are located, and these facilities have regi<strong>on</strong>al<br />
roles. Averaging levels <strong>of</strong> provisi<strong>on</strong> across groups <strong>of</strong> LGAs or regi<strong>on</strong>s<br />
would reduce local deficits and even out provisi<strong>on</strong> across the regi<strong>on</strong>, but it<br />
is difficult to apporti<strong>on</strong> “excess” places across regi<strong>on</strong>s in accord with actual<br />
use.<br />
• The shortfall is taken into account in the base populati<strong>on</strong> opti<strong>on</strong>s that adjust<br />
for the frail aged. Base 3 especially makes a significant adjustment by<br />
doubling the moderately, severely and pr<strong>of</strong>oundly handicapped living in the<br />
community, hence LGAs with more frail aged people in the community due<br />
to a shortfall <strong>of</strong> residential care places gain most. The base populati<strong>on</strong>s also<br />
make these adjustments <strong>on</strong> the basis <strong>of</strong> the LGA in which the individual<br />
actually resides.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 29
Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
• Data from the Aged Care Assessment Teams has c<strong>on</strong>sistently shown that a<br />
substantial proporti<strong>on</strong> <strong>of</strong> those assessed as requiring nursing home care are<br />
in acute care immediately prior to admissi<strong>on</strong> to residential care rather than<br />
living in the community.<br />
Resource implicati<strong>on</strong>s<br />
• It was c<strong>on</strong>sidered that inclusi<strong>on</strong> <strong>of</strong> the residential care shortfall in the <strong>RREF</strong><br />
could imply that HACC rather than the Comm<strong>on</strong>wealth residential care<br />
program should make up for the deficit <strong>of</strong> resources. The level <strong>of</strong> resources<br />
available to HACC however means that this is certainly not the case and<br />
funding for residential care places is needed either directly or by way <strong>of</strong><br />
CACPs or Extended Aged Care at Home packages.<br />
• C<strong>on</strong>sistent with exclusi<strong>on</strong> <strong>of</strong> the VHC eligible populati<strong>on</strong> <strong>on</strong> the grounds <strong>of</strong><br />
alternative funding being available, the Comm<strong>on</strong>wealth funds the<br />
Residential Care Program and should be resp<strong>on</strong>sible for funding up to the<br />
target levels.<br />
• While acknowledging the local impact <strong>of</strong> shortfalls in residential care <strong>on</strong><br />
HACC services, the most appropriate resp<strong>on</strong>se to this situati<strong>on</strong> is seen to be<br />
through the Comm<strong>on</strong>wealth residential care program. In the light <strong>of</strong> the<br />
c<strong>on</strong>siderati<strong>on</strong>s noted above, and especially the need to address the<br />
residential care shortfall directly rather than through HACC, it is c<strong>on</strong>sidered<br />
that the <strong>RREF</strong> should not include the residential care shortfall either as a<br />
need factor or in the base populati<strong>on</strong>.<br />
Cross-border regi<strong>on</strong>s<br />
In regi<strong>on</strong>s bordering other states, queries were raised about how cross border<br />
movements could be taken into account in the base populati<strong>on</strong>. While<br />
recognising the importance <strong>of</strong> this issue to local areas, the <strong>RREF</strong> base<br />
populati<strong>on</strong> can <strong>on</strong>ly be based <strong>on</strong> the resident populati<strong>on</strong> reported at the Census<br />
and in other data bases. Issues <strong>of</strong> cross border access and delivery <strong>of</strong> services<br />
need to be addressed both at Comm<strong>on</strong>wealth-State level and in local planning<br />
in these border areas.<br />
Alternative opti<strong>on</strong>s for base populati<strong>on</strong>s<br />
Some participants suggested additi<strong>on</strong>al permutati<strong>on</strong>s for the base populati<strong>on</strong>.<br />
Some proposals were made for different adjustments for the old-old <strong>on</strong> the basis<br />
<strong>of</strong> the high rate <strong>of</strong> handicap in the 85 and over age group. The small size <strong>of</strong> this<br />
group however mean that any adjustment in additi<strong>on</strong> to the Base 3 opti<strong>on</strong> <strong>of</strong><br />
doubling the populati<strong>on</strong> aged 70+ with core activity restricti<strong>on</strong>s would make<br />
<strong>on</strong>ly a marginal difference but add complexity to a revised <strong>RREF</strong> formula.<br />
Another variant involved doubling those with a pr<strong>of</strong>ound core activity<br />
restricti<strong>on</strong> aged under 70. This opti<strong>on</strong> is limited by the low rates <strong>of</strong> pr<strong>of</strong>ound<br />
handicap at younger age groups, which mean that separating out the different<br />
levels <strong>of</strong> handicap would reduce the reliability <strong>of</strong> estimates <strong>of</strong> prevalence <strong>of</strong><br />
handicap, and add complexity to the model. Maintaining use <strong>of</strong> the full rates<br />
for moderate, severe and pr<strong>of</strong>ound handicap for all age groups also provides<br />
greater c<strong>on</strong>sistency with formulas used in other programs.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 30
Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
1.8 RESOLUTION OF OPTIONS FOR THE <strong>RREF</strong> BASE POPULATION<br />
Data for defining the populati<strong>on</strong> in need <strong>of</strong> HACC services<br />
C<strong>on</strong>tinue to use DACS data, with DHS to c<strong>on</strong>tinue to liaise with the ABS to optimise the<br />
usefulness <strong>of</strong> the next DACS survey for planning <strong>of</strong> HACC and other programs.<br />
Opti<strong>on</strong>s for prevalence <strong>of</strong> handicap<br />
Use statewide prevalence<br />
Populati<strong>on</strong> living in the community:<br />
Proceed with modelling <strong>on</strong> a provisi<strong>on</strong>al basis with use <strong>of</strong> currently available data for aged<br />
residential care <strong>on</strong> approved beds as at September 2000, but to be updated with data <strong>on</strong> actual<br />
residents in implementati<strong>on</strong> <strong>of</strong> a revised <strong>RREF</strong>.<br />
Adjustment for the frail aged<br />
The views expressed at the c<strong>on</strong>sultati<strong>on</strong>s and the tally <strong>of</strong> the resp<strong>on</strong>se sheets completed by<br />
participants showed that:<br />
• Preferences between Base 2 and Base 3 showed a marginal preference for Base 2.<br />
The grounds that Base 2 gave a larger base populati<strong>on</strong> can be set aside as the size <strong>of</strong><br />
the base populati<strong>on</strong> does not affect resource levels, while the goals <strong>of</strong> early<br />
interventi<strong>on</strong> and primary preventi<strong>on</strong> in the young-old populati<strong>on</strong> go bey<strong>on</strong>d the<br />
scope <strong>of</strong> HACC.<br />
• Those preferring Base 3 perceived that it was more balanced towards the frail aged<br />
70+ and those with chr<strong>on</strong>ic illnesses, more accurately reflected the current HACC<br />
user group and those requiring complex care, and allowed for sec<strong>on</strong>dary preventi<strong>on</strong>.<br />
• Given this balance <strong>of</strong> preferences and to provide comparis<strong>on</strong> <strong>of</strong> outcomes, models<br />
are presented below for a revised <strong>RREF</strong> with both base populati<strong>on</strong>s Opti<strong>on</strong> 2:<br />
including the total populati<strong>on</strong> 70+, and Opti<strong>on</strong> 3: doubling the moderately, severely<br />
and pr<strong>of</strong>oundly handicapped populati<strong>on</strong> aged 70+<br />
Veterans<br />
As the <strong>RREF</strong> is a resource allocati<strong>on</strong> tool, the veteran populati<strong>on</strong> eligible for the VHC program<br />
should be excluded from the base populati<strong>on</strong> because <strong>of</strong> the additi<strong>on</strong>al resources that are now<br />
available to these clients. This exclusi<strong>on</strong> in the formula does not mean that VHC eligible<br />
veterans are excluded from receiving HACC services.<br />
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Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
STEP 2: OPTIONS FOR VARIABLES FOR RECOGNISING NEED IN THE<br />
<strong>RREF</strong><br />
The failure to take account <strong>of</strong> factors other than age that affect the need for HACC<br />
services in local populati<strong>on</strong>s is a major shortcoming in the current <strong>RREF</strong>. The<br />
C<strong>on</strong>sultati<strong>on</strong> Paper posed three questi<strong>on</strong>s to canvass the variables that needed to be<br />
c<strong>on</strong>sidered to address this shortcoming.<br />
1. What factors affecting prevalence <strong>of</strong> handicap and need for HACC services, in<br />
additi<strong>on</strong> to age, should be c<strong>on</strong>sidered for inclusi<strong>on</strong> in the <strong>RREF</strong>?<br />
2. What are the strengths and limitati<strong>on</strong>s <strong>of</strong> composite indexes <strong>of</strong> socio-ec<strong>on</strong>omic<br />
disadvantage compared to other specific variables?<br />
3. How should factors affecting those born in n<strong>on</strong>-English speaking countries, Koori<br />
communities and geographic factors such as remoteness be dealt with in the<br />
funding distributi<strong>on</strong> formula?<br />
2.1 RANGE AND NATURE OF NEED VARIABLES<br />
A total <strong>of</strong> 29 variables were suggested in the Round 1 C<strong>on</strong>sultati<strong>on</strong>s. As well as 27 single<br />
variables, two composite indexes were noted, namely the Index <strong>of</strong> Relative Socio-Ec<strong>on</strong>omic<br />
Disadvantage (IRSED) and the Accessibility/Remoteness Index for Australia (ARIA). These<br />
variables are grouped and listed under five dimensi<strong>on</strong>s <strong>of</strong> need in Box 1. The eight variables<br />
shown in bold in Chart 2 have already been c<strong>on</strong>sidered in the opti<strong>on</strong>s for the <strong>RREF</strong> Base<br />
Populati<strong>on</strong> opti<strong>on</strong>s in Step 1, leaving 20 variables for c<strong>on</strong>siderati<strong>on</strong>.<br />
Three aspects <strong>of</strong> the nature <strong>of</strong> need variables to be c<strong>on</strong>sidered for inclusi<strong>on</strong> in the <strong>RREF</strong> warrant<br />
comment:<br />
1. The range <strong>of</strong> need variables proposed for c<strong>on</strong>siderati<strong>on</strong> are indicators <strong>of</strong><br />
broad dimensi<strong>on</strong>s <strong>of</strong> functi<strong>on</strong>ing and well-being, not direct measures <strong>of</strong><br />
need for HACC services. If such direct measures were available, it<br />
would not be necessary to c<strong>on</strong>sider the array <strong>of</strong> variables that are<br />
canvassed here. Further, the variables are used in the <strong>RREF</strong> as<br />
indicators <strong>of</strong> relative need, not absolute levels <strong>of</strong> need.<br />
2. The availability <strong>of</strong> data, and the quality <strong>of</strong> that data, change over time.<br />
Any variables can <strong>on</strong>ly be measured with data available at a given time,<br />
but the c<strong>on</strong>tinuing development <strong>of</strong> indicators <strong>of</strong> health and well-being,<br />
and improvements in data collecti<strong>on</strong>, means there is potential for<br />
change in the variables included in the <strong>RREF</strong> in the future. This<br />
potential for incorporating new variables and updated and improved<br />
data sources as they become available make the <strong>RREF</strong> a dynamic<br />
formula that will be modified following the next census in August <strong>2001</strong><br />
and again after the next DAC Survey scheduled for 2003, and in the<br />
light <strong>of</strong> further developments in the measures such as the Burden <strong>of</strong><br />
Disease and other indexes <strong>of</strong> well-being.<br />
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Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
3. All data <strong>on</strong> need variables in the <strong>RREF</strong> are compiled at the LGA level.<br />
These data give an indicati<strong>on</strong> <strong>of</strong> the level <strong>of</strong> need am<strong>on</strong>g the whole<br />
populati<strong>on</strong>, using data <strong>on</strong> need characteristics taken from the full<br />
populati<strong>on</strong> count in the Census. The DACS survey does not collect<br />
data <strong>on</strong> the same range <strong>of</strong> need variables and hence this informati<strong>on</strong> is<br />
not available specifically for the DACS populati<strong>on</strong>. However, the need<br />
characteristics <strong>of</strong> the DACS populati<strong>on</strong> are reflected in pr<strong>of</strong>ile <strong>of</strong> the<br />
total populati<strong>on</strong> in any area, and at the same time, the level <strong>of</strong> need in<br />
the wider community in which individuals with disabilities live has a<br />
bearing <strong>on</strong> their well being and access to services.<br />
Box 1: Variables suggested for c<strong>on</strong>siderati<strong>on</strong> for inclusi<strong>on</strong> in <strong>RREF</strong><br />
Dimensi<strong>on</strong> <strong>of</strong><br />
No. Variables Suggested<br />
need<br />
Socio-ec<strong>on</strong>omic<br />
factors<br />
8<br />
<strong>Health</strong><br />
indicators 7<br />
Populati<strong>on</strong><br />
subgroups<br />
Service system<br />
factors<br />
7<br />
3<br />
Locati<strong>on</strong> factors 4<br />
Public housing, Household income,<br />
Living al<strong>on</strong>e,<br />
Carer availability, Carer Payment, Carer Allowance<br />
Index <strong>of</strong> Relative Socio-Ec<strong>on</strong>omic Disadvantage<br />
Take up <strong>of</strong> benefits: combining Disability Support Pensi<strong>on</strong>, Child<br />
Disability Allowance and full rate Age Pensi<strong>on</strong>.<br />
Handicap by age,<br />
Excess morbidity,<br />
Mortality-all causes, Mortality-selected causes, Premature mortality<br />
Life expectancy,<br />
Self reported health/well being<br />
Frail aged 85+, Total aged 70+, Frail aged 70+<br />
Eligible veterans<br />
N<strong>on</strong>-English speaking birthplace,<br />
Cultural diversity (fluency in English),<br />
Koori populati<strong>on</strong><br />
Use <strong>of</strong> aged residential care,<br />
Use <strong>of</strong> disability accommodati<strong>on</strong><br />
Shortfall in access to aged residential care/CACPs<br />
Rural populati<strong>on</strong> density/dispersi<strong>on</strong> and reduced access to HACC<br />
related services,<br />
Rural-urban fringe,<br />
Retirement villages,<br />
Accessibility/Remoteness Index for Australia (ARIA)<br />
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Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
Chart 2: Assessment and eliminati<strong>on</strong> <strong>of</strong> variables for weighting<br />
29 variables proposed<br />
8 taken into account in c<strong>on</strong>sidering<br />
opti<strong>on</strong>s for Base Populati<strong>on</strong><br />
21 variables<br />
for c<strong>on</strong>siderati<strong>on</strong> for weighting<br />
6 variables eliminated<br />
as not meeting key criteria<br />
and redundant/duplicative<br />
10 variables eliminated<br />
as redundant / duplicative<br />
and <strong>on</strong> other criteria<br />
5 variables identified as appropriate<br />
for c<strong>on</strong>siderati<strong>on</strong> for weighting<br />
2.2 CRITERIA FOR ASSESSING VARIABLES FOR INCLUSION<br />
Given the large number <strong>of</strong> possible variables that could be selected for weighting the <strong>RREF</strong>, a<br />
set <strong>of</strong> criteria was developed to assess each variable. The first six criteria address issues raised<br />
in the c<strong>on</strong>sultati<strong>on</strong>s and submissi<strong>on</strong>s, and by the Reference Group, Steering Committee and<br />
Review team.<br />
They are that any variable c<strong>on</strong>sidered for weighting in the <strong>RREF</strong> should:<br />
• have a dem<strong>on</strong>strated relati<strong>on</strong>ship to need for HACC services, <strong>on</strong> the basis <strong>of</strong><br />
research findings and experience in practice;<br />
• be primarily an indicator <strong>of</strong> need for HACC services;<br />
• be available at individual LGA level, that is, the <strong>RREF</strong> has to be built “bottom-up”<br />
and not use variables that are generalised across all LGAs in a regi<strong>on</strong> and so<br />
obscure local variati<strong>on</strong>;<br />
• have a sufficient range <strong>of</strong> variati<strong>on</strong> to bring about a significant change in weighting<br />
(that is, the variable has to vary);<br />
• have been used in other accepted formulas, and<br />
• composite indexes were recognised as possibly being useful.<br />
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Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
As well as these criteria, two technical c<strong>on</strong>siderati<strong>on</strong>s need to be taken into account:<br />
• The data have to be collected systematically and be available from a reliable source;<br />
and<br />
• There is minimum duplicati<strong>on</strong> or redundancy with other variables.<br />
The first seven criteria are self-explanatory. The last criteri<strong>on</strong>, assessment <strong>of</strong> duplicati<strong>on</strong> or<br />
redundancy, can be d<strong>on</strong>e in descriptive terms and/or statistically, and can especially assist in<br />
selecti<strong>on</strong> between alternative variables as indicators <strong>of</strong> similar aspects <strong>of</strong> need.<br />
2.3 ASSESSMENT OF VARIABLES<br />
It should be emphasised that all the variables identified in the c<strong>on</strong>sultati<strong>on</strong>s were recognised as<br />
having a bearing <strong>on</strong> need for HACC services, and that eliminati<strong>on</strong> <strong>of</strong> any variable for<br />
c<strong>on</strong>siderati<strong>on</strong> for inclusi<strong>on</strong> for weighting the <strong>RREF</strong> is not a denial <strong>of</strong> this relevance. Rather<br />
than including all possible variables however, the revised <strong>RREF</strong> has to include a careful<br />
selecti<strong>on</strong> <strong>of</strong> a smaller number <strong>of</strong> variables that are str<strong>on</strong>gly related to need and that are<br />
statistically sound. Appropriate variables were assessed against the criteria set out above and<br />
identified by a process <strong>of</strong> eliminati<strong>on</strong> as set out in Chart 2.<br />
29 variables were proposed<br />
⇒ 6 variables were c<strong>on</strong>sidered and adopted as opti<strong>on</strong>s for the <strong>RREF</strong> base populati<strong>on</strong>.<br />
⇒ The residential care shortfall variable and the veteran populati<strong>on</strong> have also been covered<br />
in discussi<strong>on</strong> <strong>of</strong> the base populati<strong>on</strong>.<br />
21 variables remained<br />
⇒<br />
6 were eliminated as not meeting the key criteria <strong>of</strong> being available at LGA level, being<br />
available from a reliable source and / or duplicati<strong>on</strong> or redundancy with other variables.<br />
These 6 variables and reas<strong>on</strong>s for eliminati<strong>on</strong> were:<br />
Retirement village residents were excluded <strong>on</strong> grounds <strong>of</strong> data not being available at LGA<br />
level, from a reliable source; as well as the definiti<strong>on</strong> <strong>of</strong> “retirement village” being problematic<br />
in relati<strong>on</strong> to inclusi<strong>on</strong> <strong>of</strong> some nursing home and hostel residents. This variable failed to meet<br />
most <strong>of</strong> the other criteria. Residents <strong>of</strong> retirement villages are <strong>of</strong> course included in the base<br />
populati<strong>on</strong>s as part <strong>of</strong> total LGA populati<strong>on</strong>s.<br />
Carer availability failed the criteria <strong>of</strong> LGA level data being available from a reliable source<br />
and also has a high level <strong>of</strong> duplicati<strong>on</strong> with living al<strong>on</strong>e. Self evidently, those living al<strong>on</strong>e do<br />
not have a co-resident carer, and the majority, but certainly not all, n<strong>on</strong>-co-resident carers are<br />
able to provide less intensive support. Further, higher needs for support from services <strong>on</strong> the<br />
part <strong>of</strong> those living al<strong>on</strong>e are counterbalanced by the needs for carer support <strong>on</strong> the part <strong>of</strong> those<br />
who live with or have n<strong>on</strong>-co-resident carers. There is thus c<strong>on</strong>siderable duplicati<strong>on</strong> between<br />
the variables living al<strong>on</strong>e and lack <strong>of</strong> a carer, and at the same time, having a carer and not<br />
having a carer both create needs for support from services.<br />
Take up rates <strong>of</strong> Carer Payment and Carer Allowance were excluded <strong>on</strong> grounds <strong>of</strong><br />
duplicati<strong>on</strong> and redundancy, and apparent under-take up. Recipients <strong>of</strong> Carer Payment, which is<br />
means tested as an income support payment, can also receive Carer Allowance, but the level <strong>of</strong><br />
take up <strong>of</strong> Carer Allowance appears to be below the level <strong>of</strong> eligible recipients. There is also<br />
potential for duplicati<strong>on</strong> between income variables and the Carer Payment.<br />
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Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
Self reported health/well-being was excluded because no data is available at the LGA level<br />
from a reliable source.<br />
15 variables remained<br />
<strong>Health</strong> status indicators accounted for five <strong>of</strong> these. Four <strong>of</strong> the indicators suggested are<br />
essentially alternative measures <strong>of</strong> aspects <strong>of</strong> mortality; hence there is a high level <strong>of</strong> duplicati<strong>on</strong><br />
between them, and also with the fifth indicator <strong>of</strong> excess morbidity. It is appropriate to include<br />
<strong>on</strong>ly <strong>on</strong>e health indicator for weighting in the <strong>RREF</strong> and life expectancy was c<strong>on</strong>sidered the<br />
most appropriate variable as it captures the effects <strong>of</strong> excess morbidity and premature mortality<br />
<strong>on</strong> the dependency and therefore need for HACC services.<br />
⇒Life expectancy to be c<strong>on</strong>sidered as a need variable<br />
10 variables remained<br />
Locati<strong>on</strong> factors accounted for a further three variables (retirement villages already being<br />
excluded). These were populati<strong>on</strong> density, access and rural-urban fringe locati<strong>on</strong>, and the<br />
Accessibility/ Remoteness Index for Australia (ARIA). The newly developed ARIA is based <strong>on</strong><br />
actual travel distance from small local areas to populati<strong>on</strong> centres <strong>of</strong> different sizes, and so<br />
provides a measure <strong>of</strong> accessibility rather than just populati<strong>on</strong> density or straight line distance.<br />
ARIA is a more comprehensive and relevant indicator <strong>of</strong> need in rural areas than the measure <strong>of</strong><br />
populati<strong>on</strong> density used in the current <strong>RREF</strong>. It defines 15 levels <strong>of</strong> access/remoteness across<br />
Australia, with Victorian LGAs extending across the first five levels. These five levels give a<br />
finer breakdown than the previous three tier rural weighting.<br />
⇒<br />
Accessibility/Remoteness Index for Australia (ARIA) to be c<strong>on</strong>sidered as a need<br />
variable<br />
7 variables remained, <strong>on</strong>e <strong>of</strong> which was the composite index IRSED<br />
IRSED – the Index <strong>of</strong> Relative Socio-Ec<strong>on</strong>omic Disadvantage is <strong>on</strong>e <strong>of</strong> five Socio-Ec<strong>on</strong>omic<br />
Indexes for Australia (SEIFA) and is a composite <strong>of</strong> 20 variables. IRSED has been developed<br />
by the ABS and is widely used in health and community services planning. IRSED is built up<br />
from Census data at LGA level and each LGA obtains an IRSED “score” which reflects the<br />
interacti<strong>on</strong> <strong>of</strong> the 20 variables within the LGA. One advantage <strong>of</strong> IRSED is that it gives a<br />
measure <strong>of</strong> the overall social envir<strong>on</strong>ment in which residents <strong>of</strong> any area live rather than just<br />
reporting individual data; thus, individuals <strong>of</strong> any given socio-ec<strong>on</strong>omic status who live in better<br />
<strong>of</strong>f areas will experience less disadvantage than individuals <strong>of</strong> the same socio-ec<strong>on</strong>omic status<br />
who live in a worse <strong>of</strong>f area because <strong>of</strong> opportunities afforded by the general social<br />
envir<strong>on</strong>ment.<br />
The ABS stresses that IRSED should <strong>on</strong>ly be used when its comp<strong>on</strong>ent variables are relevant to<br />
the program under c<strong>on</strong>siderati<strong>on</strong>. Many <strong>of</strong> the employment related variables in IRSED may be<br />
<strong>of</strong> less relevance to HACC than to programs providing assistance with training and<br />
employment, such as the Comm<strong>on</strong>wealth State Disability Program, and it was c<strong>on</strong>sidered that<br />
aspects <strong>of</strong> socio-ec<strong>on</strong>omic status relevant to HACC would be better represented in the <strong>RREF</strong> by<br />
separate variables. For example, cultural diversity and the Koori populati<strong>on</strong> were widely<br />
recognised as relevant to HACC, but these two variables made relatively little c<strong>on</strong>tributi<strong>on</strong> to<br />
the IRSED. The preferred opti<strong>on</strong> for the <strong>RREF</strong> is to use separate variables to weight for socioec<strong>on</strong>omic<br />
status, cultural diversity and Koori populati<strong>on</strong>.<br />
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Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
6 variables remained covering four broad dimensi<strong>on</strong>s <strong>of</strong> need.<br />
Two variables were indicators <strong>of</strong> cultural diversity:<br />
• fluency in English/speaking a language other than English at home<br />
• n<strong>on</strong>-English speaking birthplace.<br />
As the correlati<strong>on</strong> between these two variables for LGAs is .99, the choice <strong>of</strong> <strong>on</strong>e or other will<br />
make no difference statistically. As use <strong>of</strong> a language other than English at home gives a better<br />
indicator <strong>of</strong> the home situati<strong>on</strong> and adherence to culture, and especially the likelihood <strong>of</strong><br />
needing to use interpreters or staff <strong>of</strong> the same cultural background in provisi<strong>on</strong> <strong>of</strong> HACC<br />
services, it is seen as a more appropriate indicator <strong>of</strong> cultural diversity.<br />
⇒ Speaking a language other than English at home to be c<strong>on</strong>sidered as a need variable<br />
Three variables apart from the IRSED were indicators <strong>of</strong> socio-ec<strong>on</strong>omic status. As well as<br />
socio-ec<strong>on</strong>omic status being an indicator <strong>of</strong> reliance <strong>on</strong> HACC services, inclusi<strong>on</strong> <strong>of</strong> an SES<br />
indicator in weighting the <strong>RREF</strong> was seen as the most appropriate way <strong>of</strong> taking capacity to pay<br />
fees into account.<br />
Median household income<br />
Public housing<br />
Take up <strong>of</strong> benefits: Disability Support Pensi<strong>on</strong>, Child Disability Allowance, full-rate Age<br />
Pensi<strong>on</strong><br />
As <strong>on</strong>ly a small proporti<strong>on</strong> <strong>of</strong> the populati<strong>on</strong> reside in public housing, household income is seen<br />
as a more appropriate indicator <strong>of</strong> socio-ec<strong>on</strong>omic status as it show a wider range <strong>of</strong> variati<strong>on</strong><br />
across the whole populati<strong>on</strong>. Not <strong>on</strong>ly does the household income variable include those with<br />
low incomes in public housing but it also includes low income private renters. Further, assets<br />
are not taken into account, so rural areas with many households having c<strong>on</strong>siderable assets in<br />
land but low incomes record low median household incomes.<br />
Careful c<strong>on</strong>siderati<strong>on</strong> was given to the choice between median household income and a variable<br />
based <strong>on</strong> take up <strong>of</strong> benefits. The variable to be included needs to be a broad indicator <strong>of</strong> socioec<strong>on</strong>omic<br />
status, which will also reflect capacity <strong>of</strong> individuals to pay fees for HACC services<br />
or to make choices to pay for alternative services. Five sets <strong>of</strong> factors have a bearing <strong>on</strong> the<br />
choice <strong>of</strong> the variable:<br />
• Differences in focus. In c<strong>on</strong>trast to the broad eligibility criteria for HACC, the DSP<br />
and CDA are both highly targeted through eligibility based <strong>on</strong> both means testing and<br />
disability. Take up <strong>of</strong> these two benefits identifies a very small populati<strong>on</strong> with a high<br />
level <strong>of</strong> need <strong>on</strong> both these grounds, but this stringent definiti<strong>on</strong> excludes those disabled<br />
individuals whose parents or partners have income in excess <strong>of</strong> mean test limits.<br />
Inclusi<strong>on</strong> <strong>of</strong> full-rate Age Pensi<strong>on</strong>ers <strong>on</strong>ly excludes part pensi<strong>on</strong>ers who have some<br />
level <strong>of</strong> handicap and who would pay <strong>on</strong>ly limited fees for HACC services.<br />
• Eligibility for DSP and CDA is based <strong>on</strong> handicap, and so eligible individuals are<br />
covered by the definiti<strong>on</strong> <strong>of</strong> handicap used in DACS. Research commissi<strong>on</strong>ed by the<br />
DHS Disability Program reports that DACS data corresp<strong>on</strong>d much more closely with<br />
the program client populati<strong>on</strong> than DSP and CDA beneficiaries. As DSP and CDA are<br />
both means tested, there is duplicati<strong>on</strong> with income variables. Both also have age limits<br />
and other eligibility criteria and so do not cover the whole populati<strong>on</strong> c<strong>on</strong>sistently.<br />
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Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
• Stability. A variable based <strong>on</strong> take up <strong>of</strong> <strong>on</strong>e or a combinati<strong>on</strong> <strong>of</strong> benefits is subject to<br />
instability arising from changes to eligibility c<strong>on</strong>diti<strong>on</strong>s, and a degree <strong>of</strong> substituti<strong>on</strong><br />
between different benefits that individuals can receive; aboliti<strong>on</strong> <strong>of</strong> the Mature Age<br />
Allowance for example diverted beneficiaries to DSP or unemployment benefits. There<br />
is also the prospect <strong>of</strong> c<strong>on</strong>siderable welfare reform in the next 12 to 18 m<strong>on</strong>ths. The<br />
short term and l<strong>on</strong>ger term instability make projecti<strong>on</strong> <strong>on</strong> the basis <strong>of</strong> a benefit based<br />
variable particularly problematic<br />
• Quality <strong>of</strong> data. While a statewide data set suitable for use in the <strong>RREF</strong> would be<br />
available at suitable intervals, there are issues <strong>of</strong> quality <strong>of</strong> a data set that has to<br />
combine data from all Centrelink <strong>of</strong>fices, and from different benefit payment systems.<br />
Assembling such a data set involves c<strong>on</strong>siderably more computati<strong>on</strong> and hence risk <strong>of</strong><br />
error, and would be very difficult for others to replicate.<br />
• Close correlati<strong>on</strong>. The relati<strong>on</strong>ship between median household income and the<br />
proporti<strong>on</strong> <strong>of</strong> residents in each LGA in receipt <strong>of</strong> DSP and the full rate age pensi<strong>on</strong> was<br />
tested by correlati<strong>on</strong>. The result <strong>of</strong> .79 shows that the populati<strong>on</strong> in receipt <strong>of</strong> benefits<br />
is distributed between LGAs in accord with median household incomes. In making the<br />
choice between median household income or a variable based <strong>on</strong> benefit take-up, it has<br />
to be remembered that either will serve to rank LGAs from high to low <strong>on</strong> the basis <strong>of</strong><br />
their relative socio-ec<strong>on</strong>omic status.<br />
⇒ Median household income is the preferred opti<strong>on</strong> for the socio-ec<strong>on</strong>omic indicator.<br />
1 variable remained<br />
These two single variables were both identified in the c<strong>on</strong>sultati<strong>on</strong>s, and both remain for<br />
c<strong>on</strong>siderati<strong>on</strong> as variables for weighting the <strong>RREF</strong>.<br />
⇒ Koori populati<strong>on</strong> to be c<strong>on</strong>sidered as a need variable<br />
2.4 OPTIONS FOR CONSIDERATION FOR NEED VARIABLES<br />
The process <strong>of</strong> eliminati<strong>on</strong> and selecti<strong>on</strong> between alternative variables resulted in identificati<strong>on</strong><br />
<strong>of</strong> five possible need variables for weighting the <strong>RREF</strong> in additi<strong>on</strong> to those included in the Base<br />
Populati<strong>on</strong>s. The C<strong>on</strong>sultati<strong>on</strong>s sought views <strong>on</strong> these opti<strong>on</strong>s.<br />
What are the • Have the final range <strong>of</strong> variables adequately addressed your c<strong>on</strong>cerns<br />
opti<strong>on</strong>s for<br />
about factors for inclusi<strong>on</strong> in the <strong>RREF</strong>?<br />
variables for • Of the 28 variables identified from c<strong>on</strong>sultati<strong>on</strong>s for possible inclusi<strong>on</strong><br />
weighting the for weighting the <strong>RREF</strong>, 12 have been taken into account:<br />
<strong>RREF</strong>? 1 1. 7 c<strong>on</strong>sidered in base populati<strong>on</strong> opti<strong>on</strong>s<br />
2. 5 identified as appropriate for c<strong>on</strong>siderati<strong>on</strong> in weighting the <strong>RREF</strong>:<br />
3. Socio-ec<strong>on</strong>omic status: Median household income<br />
4. <strong>Health</strong> indicators: Life expectancy<br />
5. Cultural diversity: Use <strong>of</strong> a language other than English at home<br />
6. Koori populati<strong>on</strong><br />
7. Locati<strong>on</strong> factors: Accessibility/Remoteness Index <strong>of</strong> Australia<br />
(ARIA)<br />
1 : Residential care shortfall was initially included as a need variable in the Opti<strong>on</strong>s Paper but the issues raised and<br />
their resoluti<strong>on</strong> has been dealt with in Secti<strong>on</strong> 1.8<br />
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Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
2.5 FURTHER ISSUES AND PREFERRED OPTIONS FOR NEED VARIABLES<br />
• No further variables were identified for inclusi<strong>on</strong> in the <strong>RREF</strong> <strong>on</strong> a statewide basis but<br />
the need to take account <strong>of</strong> factors such as development <strong>of</strong> retirement villages in<br />
regi<strong>on</strong>al and local planning was reiterated.<br />
• Each <strong>of</strong> the proposed variables was reviewed in the c<strong>on</strong>sultati<strong>on</strong>s and clarificati<strong>on</strong> <strong>on</strong><br />
some aspects <strong>of</strong> particular variables was provided, mainly by reference back to details<br />
in the Opti<strong>on</strong>s Paper. It was emphasised that the variables drawn from Census data<br />
would all be updated following the <strong>2001</strong> Census.<br />
• There was c<strong>on</strong>siderable interest in maps <strong>of</strong> the variables presented in the Round 2<br />
C<strong>on</strong>sultati<strong>on</strong>s; rather than showing a rural-urban divide, the maps highlighted the extent<br />
<strong>of</strong> variati<strong>on</strong> within rural and urban regi<strong>on</strong>s <strong>on</strong> all the variables; these maps are included<br />
in the pr<strong>of</strong>ile <strong>of</strong> variables presented below.<br />
• The discussi<strong>on</strong> <strong>of</strong> the variable Service system factor: Shortfall in aged residential care<br />
places has been detailed above.<br />
• There was no change in three further variables:<br />
Socio-ec<strong>on</strong>omic status: Median Household Income<br />
Cultural Diversity: Language other than English spoken at home<br />
Locati<strong>on</strong> factors: Accessibility/Remoteness Index <strong>of</strong> Australia (ARIA)<br />
• Changes were canvassed for the two remaining variables:<br />
Koori Populati<strong>on</strong><br />
<strong>Health</strong> Indicator: Life expectancy<br />
• Two comments were made <strong>on</strong> the Koori populati<strong>on</strong>:<br />
1. Undercounting <strong>of</strong> the Koori populati<strong>on</strong> was noted in the Opti<strong>on</strong>s Paper and<br />
reiterated in the c<strong>on</strong>sultati<strong>on</strong>s. Comparis<strong>on</strong> <strong>of</strong> the results <strong>of</strong> the forthcoming<br />
<strong>2001</strong> Census with the number and age distributi<strong>on</strong> <strong>of</strong> the Koori populati<strong>on</strong><br />
reported in the 1996 Census will give some indicati<strong>on</strong> as to whether this<br />
problem has been moderated.<br />
2. As the Koori populati<strong>on</strong> is small in total and very unevenly distributed across<br />
the state, it was proposed that the number <strong>of</strong> Kooris in each LGA rather than the<br />
proporti<strong>on</strong> they comprised <strong>of</strong> the total LGA populati<strong>on</strong> would provide a better<br />
indicator <strong>of</strong> the impact <strong>on</strong> the service system. Further analysis <strong>of</strong> this<br />
alternative approach showed a “swings and round abouts” effect, and for other<br />
technical reas<strong>on</strong>s, the use <strong>of</strong> the proporti<strong>on</strong> Koori in LGA populati<strong>on</strong>s is<br />
preferred. Other issues <strong>of</strong> Koori service delivery also need to be addressed<br />
through regi<strong>on</strong>al and local planning and <strong>on</strong>-going service development<br />
initiatives.<br />
• There was str<strong>on</strong>g support for inclusi<strong>on</strong> <strong>of</strong> a health indicator, and discussi<strong>on</strong> focused <strong>on</strong><br />
the choice between Life Expectancy and <strong>on</strong>e <strong>of</strong> the measures developed in the DHS<br />
Burden <strong>of</strong> Disease study. Points c<strong>on</strong>sidered in resolving this issue were:<br />
1. The questi<strong>on</strong> that arose with regard to the selecti<strong>on</strong> <strong>of</strong> life expectancy was<br />
whether higher or lower life expectancy indicated an increased need for HACC<br />
services. The ambivalent nature <strong>of</strong> this relati<strong>on</strong>ship was canvassed in the<br />
Opti<strong>on</strong>s Paper.<br />
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Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
2. The relati<strong>on</strong>ships between premature mortality, poorer health status and higher<br />
levels <strong>of</strong> activity restricti<strong>on</strong>, and the need for HACC services have been<br />
dem<strong>on</strong>strated in the AIHW reports <strong>on</strong> health differentials am<strong>on</strong>g older<br />
Australians (Mathers, 1990). While there is close relati<strong>on</strong>ship between median<br />
household income and life expectancy, inclusi<strong>on</strong> <strong>of</strong> a separate health indicator<br />
is c<strong>on</strong>sidered preferable to simply doubling the socio-ec<strong>on</strong>omic status variable<br />
as it captures a somewhat different perspective <strong>on</strong> need and draws <strong>on</strong> a different<br />
source <strong>of</strong> data than the Census.<br />
3. The Burden <strong>of</strong> Disease Study (DHS, <strong>2001</strong>) provides four measures <strong>of</strong> Disability<br />
Adjusted Life Years (DALY), Disability Adjusted Life Expectancy (DALE),<br />
Years <strong>of</strong> life Lost (YLL) and <strong>Health</strong>y Years <strong>of</strong> Life Lost to Disability (YLD).<br />
Discussi<strong>on</strong> with staff involved in the Burden <strong>of</strong> Disease study identified YLD<br />
as the most appropriate measure for inclusi<strong>on</strong> in the <strong>RREF</strong> as it measures the<br />
years <strong>of</strong> healthy life that are lost to disability associated with chr<strong>on</strong>ic disease<br />
separately to mortality. The impact <strong>of</strong> chr<strong>on</strong>ic disease is measured as the years<br />
<strong>of</strong> life spent living with a chr<strong>on</strong>ic c<strong>on</strong>diti<strong>on</strong> rather than in terms <strong>of</strong> reduced life<br />
expectancy. The major diseases c<strong>on</strong>tributing to YLD are depressi<strong>on</strong>, dementia,<br />
osteoarthritis, asthma, diabetes mellitus, breast cancer, stroke, chr<strong>on</strong>ic<br />
obstructive pulm<strong>on</strong>ary disease, and ischaemic heart disease, as well as sight and<br />
hearing loss. These c<strong>on</strong>diti<strong>on</strong>s are readily recognised as characterising the<br />
HACC target populati<strong>on</strong> and corresp<strong>on</strong>d closely with the c<strong>on</strong>diti<strong>on</strong>s causing<br />
activity restricti<strong>on</strong>s as defined by the ABS.<br />
4. At the LGA level, the high inverse correlati<strong>on</strong> between YLD and life<br />
expectancy (-.71) shows that YLD is associated with premature mortality and<br />
the inverse correlati<strong>on</strong> with median household income (-0.67) shows that higher<br />
YLD is also associated with lower socio-ec<strong>on</strong>omic status. The lower<br />
correlati<strong>on</strong> <strong>of</strong> YLD and DALYs for all age groups (0.48) compared to older age<br />
groups (0.53) reflects the difference in the focus <strong>of</strong> YLD <strong>on</strong> the prevalence <strong>of</strong><br />
n<strong>on</strong>-fatal chr<strong>on</strong>ic disease whereas the DALY also reflects fatal c<strong>on</strong>diti<strong>on</strong>s.<br />
5. Inclusi<strong>on</strong> <strong>of</strong> YLD as developed in the Burden <strong>of</strong> Disease study in the <strong>RREF</strong><br />
will be the first use <strong>of</strong> the study results in a resource allocati<strong>on</strong> tool in Victoria.<br />
C<strong>on</strong>tinuing development <strong>of</strong> the Burden <strong>of</strong> Disease measures will provide for<br />
review <strong>of</strong> YLD in the future.<br />
2.6 RESOLUTION OF NEED VARIABLES FOR INCLUSION IN <strong>RREF</strong><br />
Of the six need variables initially presented as opti<strong>on</strong>s for inclusi<strong>on</strong> in the <strong>RREF</strong>, the residential<br />
care shortfall has been set aside and the five variables remaining to be included in the <strong>RREF</strong> as<br />
need variables are:<br />
1. median household income<br />
2. years lived with disability<br />
3. access and remoteness as measured by the ARIA<br />
4. language other than English spoken at home<br />
5. Koori populati<strong>on</strong> as a proporti<strong>on</strong> <strong>of</strong> each LGA populati<strong>on</strong>.<br />
Pr<strong>of</strong>iles <strong>of</strong> these variables are presented at the end <strong>of</strong> Part B <strong>of</strong> the <str<strong>on</strong>g>Report</str<strong>on</strong>g>.<br />
Models <strong>of</strong> resource allocati<strong>on</strong>s under the <strong>RREF</strong> using these five need variables and base<br />
populati<strong>on</strong>s 2 and 3 are presented in Step 7.<br />
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Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
Availability <strong>of</strong> high quality data was a criteri<strong>on</strong> for selecti<strong>on</strong> <strong>of</strong> need variables for inclusi<strong>on</strong> in<br />
the <strong>RREF</strong> and the data used is the best currently available. Further development <strong>of</strong> measures <strong>of</strong><br />
disability, burden <strong>of</strong> disease and refinement <strong>of</strong> the ARIA as a measure <strong>of</strong> access may lead to<br />
inclusi<strong>on</strong> <strong>of</strong> other variables in future as well as updating with data from the next Census and<br />
next DACS. Improvements in the enumerati<strong>on</strong> <strong>of</strong> the Koori populati<strong>on</strong> in the next Census<br />
would also have an impact <strong>on</strong> this variable.<br />
STEP 3: OPTIONS FOR SCALING NEED VARIABLES<br />
3.1 NEED FOR A STANDARD RULER FOR DIFFERENT VARIABLES<br />
Trying to take account <strong>of</strong> the effects <strong>of</strong> the six variables identified as indicators <strong>of</strong> the need for<br />
HACC services is an “apples and oranges” task. For example:<br />
• how can the effect <strong>of</strong> having 50% <strong>of</strong> the populati<strong>on</strong> in <strong>on</strong>e LGA speak a<br />
language other than English at home be compared to the effect <strong>of</strong> remoteness<br />
<strong>on</strong> another LGA that is 300 km from Melbourne?<br />
• how can the effect <strong>of</strong> a c<strong>on</strong>centrati<strong>on</strong> <strong>of</strong> Koori populati<strong>on</strong> in a rural LGA be<br />
compared to the effect <strong>of</strong> remoteness <strong>on</strong> delivering services to all who need<br />
services in the same area?<br />
• how can the effect <strong>of</strong> low incomes in an outer suburban LGA be compared with<br />
the effect <strong>of</strong> a high proporti<strong>on</strong> <strong>of</strong> the populati<strong>on</strong> in the same LGA speaking a<br />
language other than English at home?<br />
This “apples and oranges” problem is comm<strong>on</strong>ly solved by scaling the variables <strong>on</strong> the same<br />
scale. By using the same “ruler”, scaling preserves the relative positi<strong>on</strong> <strong>of</strong> each LGA, but fits<br />
the different distributi<strong>on</strong> <strong>on</strong> each variable to the same scale.<br />
Scaling involves dividing the distributi<strong>on</strong> <strong>of</strong> each variable into 10 categories or deciles that each<br />
span an equal interval <strong>of</strong> the total range <strong>of</strong> the variable. All variables are ranked so that a high<br />
value indicates a high need for HACC services. Each LGA is then given a score corresp<strong>on</strong>ding<br />
to the decile in which it falls. The LGAs that are in the lowest decile <strong>on</strong> any variable get a score<br />
<strong>of</strong> 0 and will not get any weighting for that variable. C<strong>on</strong>versely, all LGAs in the top decile get<br />
a score <strong>of</strong> 9 and so get a high weighting for that variable.<br />
Scaling in this way accords with the <strong>RREF</strong> allocating resources <strong>on</strong> the basis <strong>of</strong> relative need as<br />
it ranks LGAs by relative need <strong>on</strong> each variable. By rating all LGAs between 0 and 9 <strong>on</strong> all<br />
variables, each variable is scored as having equal relative weight. Thus, not <strong>on</strong>ly is there a<br />
relativity between the scores 0 to 9 <strong>on</strong> any <strong>on</strong>e variable, but a score <strong>of</strong> say, 5 or 9 <strong>on</strong> any <strong>on</strong>e<br />
variable carries the same weight as a score <strong>of</strong> 5 or 9 <strong>on</strong> all the other variables. Thus, following<br />
<strong>on</strong> the examples above:<br />
• the LGAs with the highest proporti<strong>on</strong> <strong>of</strong> people speaking a language other than<br />
English at home, around 50%, receive a scaled score <strong>of</strong> 9;<br />
• the most remote LGAs which have ARIA indexes around 5, also get a scaled<br />
score <strong>of</strong> 9;<br />
• the LGAs with the highest proporti<strong>on</strong>s <strong>of</strong> Kooris in their populati<strong>on</strong>s, about<br />
3.5%, receive a scaled score <strong>of</strong> 9; and<br />
• the LGAs with the lowest median incomes receive a scaled score <strong>of</strong> 9.<br />
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Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
The scaled scores <strong>on</strong> the different variables can be added together to give a combined score for<br />
each LGA. In a <strong>RREF</strong> opti<strong>on</strong> with 6 variables, the maximum score for any LGA would be 54;<br />
with 4 variables, it would be 36. The combined score for each LGA can then be readily<br />
expressed as a percentage <strong>of</strong> the maximum possible score.<br />
Statistical transformati<strong>on</strong> is a sec<strong>on</strong>d method <strong>of</strong> standardising scores to a mean <strong>of</strong> 100 and a<br />
specified standard deviati<strong>on</strong>. This method preserves the relative positi<strong>on</strong> <strong>of</strong> each LGA, but<br />
produces different results for variables where the distributi<strong>on</strong>s are skewed in different ways. In<br />
the case <strong>of</strong> most <strong>of</strong> the variables under c<strong>on</strong>siderati<strong>on</strong> for weighting the <strong>RREF</strong>, there is no need<br />
to transform the distributi<strong>on</strong>s. This opti<strong>on</strong> is also less transparent and actual values <strong>of</strong> data for<br />
LGAs are obscured at an earlier stage in the scaling and weighting process.<br />
3.2 OPTIONS FOR SCALING NEED VARIABLES FOR INCLUSION IN THE<br />
<strong>RREF</strong><br />
The opti<strong>on</strong>s for scaling the variables identified for inclusi<strong>on</strong> in the <strong>RREF</strong> are summarised<br />
below. The C<strong>on</strong>sultati<strong>on</strong>s sought views <strong>on</strong> these opti<strong>on</strong>s.<br />
What are the<br />
opti<strong>on</strong>s for<br />
scaling the<br />
variables<br />
Do the<br />
rati<strong>on</strong>ales for<br />
inclusi<strong>on</strong> set<br />
out in the<br />
pr<strong>of</strong>iles <strong>of</strong><br />
variables<br />
cover all<br />
relevant<br />
issues?<br />
• Scaling variables into deciles and scoring 0 to 9, from lowest to<br />
highest need, is the identified opti<strong>on</strong>.<br />
• Each LGA to receive a score <strong>on</strong> each variable to reflect relative<br />
need<br />
• Do you agree with the rati<strong>on</strong>ales for inclusi<strong>on</strong> <strong>of</strong> median<br />
household income, language other than English spoken at home,<br />
Koori populati<strong>on</strong> and ARIA as weighting variables?<br />
• As Life Expectancy correlates highly with median household<br />
income, and because <strong>of</strong> the ambivalent relati<strong>on</strong>ship <strong>of</strong> Life<br />
Expectancy to need for HACC services, should Life Expectancy<br />
be included as a variable?<br />
• Should the shortfall in residential care be included as a variable<br />
for weighting, based <strong>on</strong> operati<strong>on</strong>al rather than approved beds?<br />
3.3 FURTHER ISSUES AND PREFERRED OPTIONS<br />
Using a scale from 0 to 9 was accepted as providing a comm<strong>on</strong> ruler for all the need variables<br />
Scaled scores <strong>of</strong> LGAs <strong>on</strong> individual variables were seen to accord with views <strong>of</strong> need in the<br />
field.<br />
There was very keen interest in having access to these data for use in regi<strong>on</strong>al planning, with<br />
data <strong>on</strong> these basic need indicators to be combined with more local quantitative data, including<br />
data from the HACC MDS, and qualitative informati<strong>on</strong>.<br />
3.4 RESOLUTION OF SCALING OF NEED VARIABLES<br />
Scaling the five need variables 0 to 9 was adopted as the preferred opti<strong>on</strong>.<br />
The data <strong>on</strong> need variables and the scaled scores is included in Appendix 3 and is to be made<br />
available by DHS for use in regi<strong>on</strong>al planning <strong>of</strong> HACC services.<br />
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Step 4: Opti<strong>on</strong>s for weighting need variables<br />
Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
4.1 WEIGHTING OF NEED VARIABLES IN RELATED FORMULAS<br />
Weighting to take account <strong>of</strong> the relative effects <strong>of</strong> different variables is <strong>on</strong>e <strong>of</strong> the most<br />
difficult tasks for any resource allocati<strong>on</strong> formula. Ideally, the effect <strong>of</strong> each variable <strong>on</strong> overall<br />
need would be assessed through statistical analysis <strong>of</strong> the relati<strong>on</strong>ships between the variables<br />
and a summary measure <strong>of</strong> need, or at least the cost or time <strong>of</strong> service required to meet need.<br />
The following examples dem<strong>on</strong>strate how different formulas have dealt with this issue.<br />
In the Resident Classificati<strong>on</strong> Scale<br />
The relati<strong>on</strong>ship between a number <strong>of</strong> resident characteristics that affect need for care and the<br />
cost and time inputs from care staff has been analysed and each questi<strong>on</strong> <strong>on</strong> the RCS carries a<br />
different weighting that reflects its effect <strong>on</strong> care needs. Each resident then receives an RCS<br />
score that takes account <strong>of</strong> their care needs, as measured and weighted by the questi<strong>on</strong>s <strong>on</strong> the<br />
RCS score.<br />
No such summary measure <strong>of</strong> need for HACC services is available by LGA however. No<br />
measure <strong>of</strong> need for post acute services was available for the development <strong>of</strong> the Post Acute<br />
Care Resource Allocati<strong>on</strong> Model, nor was a measure <strong>of</strong> need for disability services available for<br />
the Disability Program resource allocati<strong>on</strong> formula. Instead, as with the 1992 <strong>RREF</strong>, these two<br />
formulas have adopted arbitrary weightings <strong>on</strong> the recommendati<strong>on</strong> <strong>of</strong> advisory groups involved<br />
in developing the formula.<br />
In the 1992 <strong>RREF</strong><br />
• The <strong>on</strong>ly weighting was for rurality.<br />
• While density <strong>of</strong> populati<strong>on</strong> was measured, the decisi<strong>on</strong> to weight this variable by<br />
10, 20 or 30% was essentially an arbitrary resp<strong>on</strong>se to the view that rurality affected<br />
the need for services, but there was no clear evidence that did so by a factor <strong>of</strong> as<br />
much as 30%.<br />
• Although most <strong>of</strong> the LGAs in rural Victoria received the full 30% weighting, the<br />
effect <strong>on</strong> overall resource allocati<strong>on</strong> was <strong>on</strong>ly 6.8% as these LGAs accounted for<br />
<strong>on</strong>ly a small share <strong>of</strong> the total <strong>RREF</strong> base populati<strong>on</strong>.<br />
In the PACRAM<br />
• The PACRAM Reference Group recognised that older age and socio-ec<strong>on</strong>omic<br />
status affected the need for post acute services<br />
• The decisi<strong>on</strong> was made to double the weighting for these two variables in the<br />
PACRAM formula. However, there was no clear evidence to say that the two<br />
variables should be given the same extra weight or that they should be given twice<br />
as much weight as all the other variables.<br />
In the Disability Program<br />
• The Disability Program formula applies <strong>on</strong>ly to the populati<strong>on</strong> to age 65.<br />
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Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
• The weight for the Koori populati<strong>on</strong> is doubled as the Comm<strong>on</strong>wealth provides<br />
double the per capita funding for the Koori populati<strong>on</strong> in each state;<br />
• The five n<strong>on</strong>-metropolitan regi<strong>on</strong>s get a rural weighting <strong>of</strong> 5%, an arbitrary<br />
decisi<strong>on</strong>;<br />
• The two regi<strong>on</strong>s <strong>of</strong> greatest socio-ec<strong>on</strong>omic disadvantage, as measured by the<br />
IRSED, are weighted by 10%; the decisi<strong>on</strong> to give these regi<strong>on</strong>s a weighting<br />
recognises the effect <strong>of</strong> socio-ec<strong>on</strong>omic disadvantage <strong>on</strong> need for disability<br />
services, but the decisi<strong>on</strong> to weight <strong>on</strong>ly two regi<strong>on</strong>s, and both by 10%, is arbitrary.<br />
4.2 PRINCIPAL COMPONENTS ANALYSIS<br />
In c<strong>on</strong>sidering opti<strong>on</strong>s for relative weighting <strong>of</strong> the variables, the <strong>RREF</strong> Review undertook a<br />
principal comp<strong>on</strong>ents analysis (PCA). PCA can provide an indicati<strong>on</strong> <strong>of</strong> the c<strong>on</strong>tributi<strong>on</strong> that<br />
each variable makes to the total variati<strong>on</strong> am<strong>on</strong>g all the variables when they are c<strong>on</strong>sidered<br />
together. PCA is especially useful when there are a large number <strong>of</strong> possible c<strong>on</strong>tributory<br />
variables and the impact <strong>of</strong> each is not readily apparent.<br />
PCA was carried out to test the relati<strong>on</strong>ships between five <strong>of</strong> the weighting variables. The<br />
ARIA was excluded as in preliminary analysis it was found to swamp the effect <strong>of</strong> all other<br />
variables. The residential care shortfall variable was also excluded as it did not correlate with<br />
any <strong>of</strong> the other variables and so did not c<strong>on</strong>tribute to any comp<strong>on</strong>ent. Two principal<br />
comp<strong>on</strong>ents were identified:<br />
1. The two variables that c<strong>on</strong>tributed most to the first comp<strong>on</strong>ent were median<br />
household income and life expectancy. High correlati<strong>on</strong> between these two<br />
variables indicated a substantial overlap and rather than using this first<br />
comp<strong>on</strong>ent in the <strong>RREF</strong>, the preferred opti<strong>on</strong> is to use each separately and to<br />
model <strong>on</strong>e opti<strong>on</strong> including both variables and <strong>on</strong>e including median household<br />
income <strong>on</strong>ly.<br />
2. The two variables that c<strong>on</strong>tributed most to the sec<strong>on</strong>d comp<strong>on</strong>ent were Koori<br />
populati<strong>on</strong> and populati<strong>on</strong> speaking a language other than English at home.<br />
The c<strong>on</strong>tributi<strong>on</strong>s <strong>of</strong> these variables were inversely correlated, and it can be<br />
c<strong>on</strong>cluded that each c<strong>on</strong>tributes to the comp<strong>on</strong>ent in a different way and that<br />
including each in the <strong>RREF</strong> as a separate variable has a similar effect to<br />
including the sec<strong>on</strong>d comp<strong>on</strong>ent.<br />
The first comp<strong>on</strong>ent explained 50% <strong>of</strong> the total variance and the sec<strong>on</strong>d comp<strong>on</strong>ent 25%.<br />
Inclusi<strong>on</strong> <strong>of</strong> the three variables that c<strong>on</strong>tributed str<strong>on</strong>gly to the two principal comp<strong>on</strong>ents -<br />
median household income, cultural diversity and Koori populati<strong>on</strong> - in the <strong>RREF</strong> captures a<br />
large proporti<strong>on</strong> <strong>of</strong> the total variance. The comp<strong>on</strong>ent loadings did not however give any clear<br />
guidance that any <strong>on</strong>e variable should be weighted more than the others.<br />
4.3 EXPERT ADVICE<br />
Expert advice was received from both the <strong>Department</strong>al Steering Committee and the wider<br />
Reference Group <strong>of</strong> representatives <strong>of</strong> provider and c<strong>on</strong>sumer groups. These two groups<br />
brought together a wide range <strong>of</strong> statistical skills and practical experience in the field.<br />
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Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
Both groups c<strong>on</strong>sidered that the range <strong>of</strong> variables that had been c<strong>on</strong>sidered had covered the<br />
main factors affecting need for HACC services and that inclusi<strong>on</strong> <strong>of</strong> six variables in the base<br />
populati<strong>on</strong>s and six need factors for weighting would give appropriate recogniti<strong>on</strong> to these<br />
factors in the <strong>RREF</strong>.<br />
With regard to grounds for weighting any <strong>on</strong>e <strong>of</strong> these variables more than another, the expert<br />
opini<strong>on</strong> was that opti<strong>on</strong>s should be modelled to illustrate the effects <strong>of</strong> weighting, with the<br />
unadjusted variables providing the basis for comparis<strong>on</strong>.<br />
4.4 EFFECTS OF WEIGHTING OF VARIABLES<br />
There are a variety <strong>of</strong> opti<strong>on</strong>s for weighting variables and it was c<strong>on</strong>sidered useful to model<br />
some opti<strong>on</strong>s for the <strong>RREF</strong> without adjusting the weighting <strong>of</strong> need variables and to provide<br />
examples with adjusted weightings to dem<strong>on</strong>strate the impact <strong>of</strong> such adjustments.<br />
With unadjusted weighting, the c<strong>on</strong>tributi<strong>on</strong> that each variable makes to the overall outcome<br />
reflects the distributi<strong>on</strong> <strong>of</strong> scores across LGAs. For all variables, the highest need LGA gets a<br />
score <strong>of</strong> 9, and the lowest get a score <strong>of</strong> 0, but variable A <strong>on</strong> which a large number <strong>of</strong> LGAs get<br />
a low score and a few get a high score will have less impact overall than variable B <strong>on</strong> which a<br />
large number <strong>of</strong> LGAs get a high score and a few get a low score.<br />
If it is c<strong>on</strong>sidered that variable A has a markedly str<strong>on</strong>ger impact <strong>on</strong> the need for HACC<br />
services than variable B, there may be grounds for adjusting the weighting for variable A to take<br />
account <strong>of</strong> this relati<strong>on</strong>ship. Reas<strong>on</strong>s that might be c<strong>on</strong>sidered for varying the weighting <strong>of</strong><br />
different variables were canvassed in the C<strong>on</strong>sultati<strong>on</strong>s and are noted below.<br />
Modelling <strong>of</strong> opti<strong>on</strong>s with and without adjustments to the weighting <strong>of</strong> the need variables is<br />
useful for illustrating the effects <strong>of</strong> varying the weighting between variables. It should however<br />
be noted that the effects <strong>of</strong> changing the weighting <strong>of</strong> any <strong>on</strong>e variable are c<strong>on</strong>strained as the<br />
weightings for all variables have to total 100%. Increasing the weighting <strong>of</strong> <strong>on</strong>e variable thus<br />
reduces the weighting <strong>of</strong> others; for example, in a five variable model in which each variable<br />
happened to c<strong>on</strong>tribute 20%, doubling <strong>of</strong> <strong>on</strong>e variable would increase that variable to 33% and<br />
reduce the other four to 16.6% each.<br />
4.5 OPTIONS FOR CONSIDERATION FOR WEIGHTING OF NEED<br />
VARIABLES<br />
The Opti<strong>on</strong>s Paper illustrated two sets <strong>of</strong> opti<strong>on</strong>s for adjusting the weightings <strong>of</strong> the need<br />
variables, by way <strong>of</strong> (1) reducing the number <strong>of</strong> variables to be included in the <strong>RREF</strong> from 6 to<br />
4, and (2) by doubling the weighting <strong>of</strong> some variables. The C<strong>on</strong>sultati<strong>on</strong>s sought views <strong>on</strong><br />
these opti<strong>on</strong>s.<br />
What are the<br />
opti<strong>on</strong>s for<br />
weighting the<br />
variables?<br />
• Should all variables evenly weighted?<br />
• Which if any <strong>of</strong> the variables should be weighted more than<br />
others, and for what reas<strong>on</strong>s?<br />
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Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
4.6 FURTHER ISSUES AND PREFERRED OPTIONS<br />
Two aspects <strong>of</strong> differential weighting <strong>of</strong> the need variables were canvassed<br />
in the c<strong>on</strong>sultati<strong>on</strong>s:<br />
1. views as to the variables that warranted greater weight <strong>on</strong> the basis <strong>of</strong><br />
making a greater c<strong>on</strong>tributi<strong>on</strong> to need for HACC services, and<br />
2. the actual weight that each variable c<strong>on</strong>tributed to the model.<br />
Variables warranting greater weighting<br />
Participants in the Round 2 c<strong>on</strong>sultati<strong>on</strong>s expressed the view that some variables were seen to<br />
have a greater bearing <strong>on</strong> need than others. The two variables that were most widely seen to<br />
warrant more weight were rurality and socio-ec<strong>on</strong>omic status, each identified in around 40% <strong>of</strong><br />
resp<strong>on</strong>ses, followed by the health indicator and the residential care shortfall variable, each<br />
identified in around 20% <strong>of</strong> resp<strong>on</strong>ses. Only a minority <strong>of</strong> resp<strong>on</strong>ses, around 10%, identified<br />
cultural diversity and the Koori variable as warranting additi<strong>on</strong>al weighting.<br />
At the same time, it was recognised that there were no clear empirical grounds for adjusting the<br />
weightings and it was noted that any weighting based <strong>on</strong> arbitrary decisi<strong>on</strong>s would complicate<br />
the process; even those who favoured giving additi<strong>on</strong>al weighting to some variables commented<br />
that the process was imprecise. The opti<strong>on</strong> <strong>of</strong> further statistical modelling bey<strong>on</strong>d the principal<br />
comp<strong>on</strong>ents analysis already carried out was precluded by the lack <strong>of</strong> a measure <strong>of</strong> need that<br />
could be used as the independent variable in methods such as regressi<strong>on</strong> analysis.<br />
Actual c<strong>on</strong>tributi<strong>on</strong> <strong>of</strong> variables to model<br />
The scaling <strong>of</strong> all variables from 0 to 9 treats each variable as having an equal relati<strong>on</strong>ship to<br />
need for HACC services. This equal treatment or equal weighting does not however mean that<br />
each variable does in fact make the same c<strong>on</strong>tributi<strong>on</strong> to overall need. The c<strong>on</strong>tributi<strong>on</strong> that<br />
each variable makes depends <strong>on</strong> the distributi<strong>on</strong> <strong>of</strong> LGAs across the range <strong>of</strong> scores from 0 to 9.<br />
A variable <strong>on</strong> which many LGAs receive a high scaled score will make a greater c<strong>on</strong>tributi<strong>on</strong> to<br />
the overall outcome than <strong>on</strong>e <strong>on</strong> which <strong>on</strong>ly a few LGAs have a high scaled score and most<br />
have lower scores.<br />
Thus, as a large number <strong>of</strong> LGAs have a relatively high scaled score <strong>on</strong> median household<br />
income, reflecting low socio-ec<strong>on</strong>omic status, this variable c<strong>on</strong>tributes a large part <strong>of</strong> the overall<br />
model. Similarly, a large number <strong>of</strong> LGAs receive a relatively high YLD and ARIA scores. In<br />
c<strong>on</strong>trast, <strong>on</strong>ly a small number <strong>of</strong> LGAs have a high proporti<strong>on</strong> <strong>of</strong> their populati<strong>on</strong> that is Koori<br />
and many LGAs receive a low scaled score <strong>on</strong> this variable.<br />
The c<strong>on</strong>tributi<strong>on</strong> that each variable makes to the revised <strong>RREF</strong> model is shown in Table 4.1 in<br />
which the total points that each variable actually c<strong>on</strong>tributes are also expressed as a percentage<br />
<strong>of</strong> the actual total <strong>of</strong> 1293.<br />
Even without any further adjustment to take account <strong>of</strong> perceived relati<strong>on</strong>ships to need, it is<br />
evident that each variable makes a different c<strong>on</strong>tributi<strong>on</strong> to the overall model and so carries a<br />
different weight. Thus, the Household Income variable c<strong>on</strong>tributes 494 points, 38.2% <strong>of</strong> the<br />
total actual points, while the cultural diversity variable c<strong>on</strong>tributes 136 points and 10.5% <strong>of</strong> total<br />
need. Given these differences, it may be more appropriate to refer to “unadjusted” weightings<br />
rather than “even” weightings.<br />
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Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
The overall effect <strong>of</strong> doubling the two selected variables is shown in Table 4.1, but the impact<br />
<strong>on</strong> regi<strong>on</strong>s is affected by the distributi<strong>on</strong> <strong>of</strong> the scores <strong>on</strong> these variables across LGAs and the<br />
size <strong>of</strong> the LGA populati<strong>on</strong>s to which the adjusted weightings apply.<br />
Table 4.1: C<strong>on</strong>tributi<strong>on</strong> <strong>of</strong> need variables to overall need weighting in five<br />
variable model<br />
C<strong>on</strong>tributi<strong>on</strong> to<br />
overall need<br />
weighting<br />
Median<br />
H’hold<br />
Income<br />
Years<br />
Life<br />
Disability<br />
ARIA<br />
Cultural<br />
Diversity<br />
Koori<br />
Populati<strong>on</strong><br />
Total<br />
Unadjusted:<br />
Total Score 494 387 209 136 67 1293<br />
% c<strong>on</strong>tributi<strong>on</strong> 38.2 29.9 16.2 10.5 5.2 100.0<br />
Doubling <strong>of</strong> Median<br />
H’hold Income<br />
Total score 988 387 209 136 67 1787<br />
% c<strong>on</strong>tributi<strong>on</strong> 55.3 21.7 11.7 7.6 3.7 100.0<br />
Doubling ARIA<br />
Total score 494 387 418 136 67 1502<br />
% c<strong>on</strong>tributi<strong>on</strong> 32.9 25.8 27.8 9.1 4.5 100.0<br />
Impact <strong>of</strong> adjusting weightings<br />
The household income variable already carries the greatest weight in the model, followed by the<br />
health indicator. Doubling the weight for the household income variable increases the total<br />
actual points to 1787 and increases the c<strong>on</strong>tributi<strong>on</strong> <strong>of</strong> this variable to 55.3%, but as shown in<br />
Table 4.1 above, the weightings for all the other variables decrease.<br />
The Round 2 C<strong>on</strong>sultati<strong>on</strong>s attached c<strong>on</strong>siderable importance to inclusi<strong>on</strong> <strong>of</strong> the separate health<br />
indicator and as it was seen as a candidate for increased weighting, it is seen to be more<br />
appropriate to include the two separate variables, which together c<strong>on</strong>tribute 68.1% <strong>of</strong> the total<br />
need weighting in the revised model, than to double the income variable and exclude the health<br />
indicator. With doubling <strong>of</strong> the socio-ec<strong>on</strong>omic variable, it together with the health indicator<br />
account for 77% <strong>of</strong> the total need weighting.<br />
The ARIA c<strong>on</strong>tributes the third highest weight to the overall model, 16.2%. Doubling the<br />
ARIA suggests that its c<strong>on</strong>tributi<strong>on</strong> to the overall model increases to 27.8%, but the size <strong>of</strong> the<br />
base populati<strong>on</strong>s in LGAs to which the increased weighting is applied is an important factor in<br />
determining the actual outcome for regi<strong>on</strong>s. Whether adjusted or not, the weightings for rurality<br />
as the single need variable in the current <strong>RREF</strong> cannot be compared with the weightings for the<br />
ARIA as <strong>on</strong>e <strong>of</strong> several variables in a multi-variable model.<br />
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Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
Extensive modelling reported in the Opti<strong>on</strong>s Paper indicated that doubling the ARIA did not<br />
bring about a significant change in overall outcomes as the additi<strong>on</strong>al weighting applied<br />
generally to <strong>on</strong>ly small rural populati<strong>on</strong>s. While the c<strong>on</strong>sultati<strong>on</strong>s identified rurality as a factor<br />
warranting additi<strong>on</strong>al weight, it was also recognised that increases in resource allocati<strong>on</strong><br />
flowing <strong>on</strong> from increased weighting <strong>of</strong> the ARIA in the <strong>RREF</strong> would result in higher<br />
performance targets for rural service providers rather than addressing the additi<strong>on</strong>al costs <strong>of</strong><br />
service delivery associated with greater travel distances. It is seen as preferable to address these<br />
cost issues through other measures rather than increasing the weight <strong>of</strong> the ARIA in the <strong>RREF</strong><br />
model, and this issue is discussed further in Part D <strong>of</strong> the <str<strong>on</strong>g>Report</str<strong>on</strong>g>.<br />
4.7 RESOLUTION OF OPTIONS FOR WEIGHTING OF NEED VARIABLES<br />
Given the five variables make different c<strong>on</strong>tributi<strong>on</strong>s to the overall need weighting, reflecting<br />
the distributi<strong>on</strong> <strong>of</strong> the scaled scores across LGAs, <strong>RREF</strong> opti<strong>on</strong>s are prepared first without any<br />
further adjustment to weightings.<br />
To dem<strong>on</strong>strate the effects <strong>of</strong> adjusting weightings for selected variables, and to present a wider<br />
range <strong>of</strong> opti<strong>on</strong>s for a revised <strong>RREF</strong>, models are also prepared in which the weightings for the<br />
socio-ec<strong>on</strong>omic status variable: median household income, and the rurality variable: the ARIA,<br />
are doubled.<br />
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Pr<strong>of</strong>iles <strong>of</strong> Need Variables<br />
Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
This secti<strong>on</strong> presents a pr<strong>of</strong>ile <strong>of</strong> each <strong>of</strong> the five need variables. Each pr<strong>of</strong>ile covers:<br />
• Full variable name and sources <strong>of</strong> data<br />
• A brief discussi<strong>on</strong> <strong>of</strong> the main issues taken into account in the decisi<strong>on</strong> to include the<br />
variable, including issues <strong>of</strong> data availability and measurement;<br />
• A tabulati<strong>on</strong> <strong>of</strong> scaled scores <strong>on</strong> each variable: this data is set out in full in Appendix 3<br />
which detailed LGA scaled scores <strong>on</strong> each <strong>of</strong> the five variables; and<br />
• A map <strong>of</strong> each variable by LGAs; note that the variables are plotted <strong>on</strong> the maps in five<br />
categories, so that each category corresp<strong>on</strong>ds to two <strong>of</strong> the categories used in scaling the<br />
variables.<br />
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Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
VARIABLE 1: MEDIAN HOUSEHOLD INCOME - MHHY<br />
Data Source:<br />
Census, updated every five years<br />
Issues:<br />
• Median household income (MHHY) reports the middle weekly income level for each<br />
LGA, that is, 50% <strong>of</strong> households in the LGA have a higher income and 50% have a<br />
lower income. Each LGA thus has a different median income.<br />
• This variable has been reversed as a weighting variable, so that LGAs with the lowest<br />
incomes score 9, and receive the highest weighting, and those with the highest incomes<br />
score 0 and receive no weighting.<br />
• The distributi<strong>on</strong> <strong>of</strong> incomes by LGAs is skewed, with <strong>on</strong>ly 5 LGAs in the three lowest<br />
deciles (high income), 27 in the middle four deciles, and 46 in the three highest (low<br />
incomes).<br />
• As a large number <strong>of</strong> LGAs receive a high or moderate weighting <strong>on</strong> MHHY, weighting<br />
for MHHY has a major effect in redistributi<strong>on</strong> <strong>of</strong> growth funds.<br />
• A large number <strong>of</strong> LGAs receive a high or moderate weighting <strong>on</strong> MHHY.<br />
Variable 1: Median Household Income<br />
Decile score Income $ per week No <strong>of</strong> LGAs % <strong>of</strong> LGAs<br />
0 922.601-980.000 1 1.28<br />
1 865.201-922.600 2 2.56<br />
2 807.801-865.200 2 2.56<br />
3 750.401-807.800 5 6.41<br />
4 693.001-750.400 8 10.26<br />
5 635.601-693.000 9 11.54<br />
6 578.201-635.600 5 6.41<br />
7 520.801-578.200 13 16.67<br />
8 463.401-520.800 22 28.21<br />
9 406.001-463.400 11 14.10<br />
Minimum $406 Bass Coast<br />
Median $546.5 Wangaratta,<br />
Darebin<br />
Maximum $980 Nillumbik<br />
Range $574<br />
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Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
VARIABLE 2: HEALTHY YEARS OF LIFE LOST TO DISABILITY – YLD<br />
Data Source:<br />
Disease Study<br />
Victorian <strong>Department</strong> <strong>of</strong> Human Services, Burden <strong>of</strong><br />
Issues:<br />
• <strong>Health</strong>y years <strong>of</strong> life lost to disability (YLD) is included as the measure <strong>of</strong> health status<br />
that is most relevant to HACC services as it captures the burden <strong>of</strong> chr<strong>on</strong>ic disease <strong>on</strong><br />
well-being and functi<strong>on</strong>ing. YLD is reported as the rate at which years <strong>of</strong> healthy life<br />
are lost to disability per 1000 populati<strong>on</strong> in each LGA, so that a higher YLD represents<br />
a greater burden <strong>of</strong> disease in terms <strong>of</strong> more years <strong>of</strong> healthy life being lost to disability.<br />
• YLD is seen to be the most appropriate <strong>of</strong> the four measures <strong>of</strong> the Burden <strong>of</strong> Disease<br />
developed by DHS as it c<strong>on</strong>centrates <strong>on</strong> the impact <strong>of</strong> chr<strong>on</strong>ic disease separately to<br />
mortality whereas the other three measures <strong>of</strong> Life Expectancy (LE), Disability<br />
Adjusted Life Years and Disability Adjusted Life Expectancy all included some<br />
measure <strong>of</strong> mortality.<br />
• YLD especially avoided the difficulty <strong>of</strong> interpreting the ambivalent relati<strong>on</strong>ship <strong>of</strong> LE<br />
to need for HACC services that posed a problem for scaling scores. It can be argued<br />
that areas with low LE experience higher rates <strong>of</strong> disability and hence have an increased<br />
need for HACC services associated with premature mortality, but at the same time,<br />
LGAs with very high LE can argue the need for more HACC services <strong>on</strong> the grounds <strong>of</strong><br />
having more very old people.<br />
• The high but inverse correlati<strong>on</strong>s between the raw scores for LGAs for YLD and<br />
median household income (-0.67) and with life expectancy (-0.71) show that the<br />
variables measure related but somewhat different dimensi<strong>on</strong>s <strong>of</strong> well-being.<br />
• YLD is a normally distributed variable, with 5 LGAs in the two lowest and two highest<br />
deciles.<br />
• The chr<strong>on</strong>ic c<strong>on</strong>diti<strong>on</strong>s that c<strong>on</strong>tribute most to the burden <strong>of</strong> disability in YLDs are<br />
depressi<strong>on</strong>, dementia, arthritis, asthma, diabetes, respiratory disease, stroke and<br />
ischaemic heart disease, and breast cancer for women. These c<strong>on</strong>diti<strong>on</strong>s are readily<br />
recognised in the HACC target populati<strong>on</strong>.<br />
• The development <strong>of</strong> YLDs to date has been fully reported in the Victorian Burden <strong>of</strong><br />
Disease Study (DHS, <strong>2001</strong>). The proposed use <strong>of</strong> YLD in the <strong>RREF</strong> would be the first<br />
applied use <strong>of</strong> this work in a resource allocati<strong>on</strong> formula, and the measure could be<br />
reviewed in future as the work <strong>on</strong> Burden <strong>of</strong> Disease proceeds.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 52
Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
Variable 2: <strong>Health</strong>y Life Years Lost to Disability<br />
Decile score Years <strong>of</strong> healthy life No <strong>of</strong> LGAs % <strong>of</strong> LGAs<br />
0 53.705-55.013 2 2.56<br />
1 55.014-56.321 3 3.85<br />
2 56.322-57.630 4 5.13<br />
3 57.631-58.938 5 6.41<br />
4 58.939-60.246 14 17.95<br />
5 60.247-61.554 21 26.92<br />
6 61.555-62.862 10 12.82<br />
7 62.863-64.170 14 17.95<br />
8 64.171-65.478 3 3.85<br />
9 65.479-66.786 2 2.56<br />
Minimum 53.705 Manningham<br />
Median 61.391 Wangaratta, Delatite<br />
Maximum 66.786 Hume<br />
Range 13.081<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 53
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 54
Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
VARIABLE 3: CULTURAL DIVERSITY: % OF POPULATION IN LGA SPEAKING<br />
A LANGUAGE OTHER THAN ENGLISH AT HOME<br />
Data Source:<br />
Census, updated every 5 years<br />
Issues:<br />
• There is a widespread percepti<strong>on</strong> and experience in service delivery that points to<br />
cultural diversity being associated with increased need for HACC services, due to health<br />
and disability status, strength <strong>of</strong> family roles and hence need for carer support, need for<br />
interpreters and other factors that increase hours <strong>of</strong> service that have to be provided.<br />
Cultural diversity is thus a need factor as it leads to additi<strong>on</strong>al hours <strong>of</strong> service inputs as<br />
much as extra costs per hour <strong>of</strong> service.<br />
• Cultural factors pose barriers to use <strong>of</strong> residential care and as a result, more <strong>of</strong> the frail<br />
older people from these backgrounds remain in the community, and to higher levels <strong>of</strong><br />
dependency, and thus require higher levels <strong>of</strong> service. Only 9% <strong>of</strong> those in residential<br />
care in Victoria had a preferred language other than English, compared to 17% <strong>of</strong> the<br />
populati<strong>on</strong> born in a n<strong>on</strong>-English speaking country.<br />
• This lower use <strong>of</strong> residential care is important in interpreting the HACC User Data that<br />
show those born overseas are represented am<strong>on</strong>g HACC clients in proporti<strong>on</strong> to their<br />
share <strong>of</strong> the populati<strong>on</strong>. The HACC data are a simple count <strong>of</strong> clients using any service<br />
and do not show adequacy <strong>of</strong> services used in relati<strong>on</strong> to cultural appropriateness or<br />
level <strong>of</strong> service needed. The level <strong>of</strong> services used is especially c<strong>on</strong>strained where<br />
communities do not have access to services such as day care that <strong>of</strong>fer relevant social<br />
and cultural support. These factors together with higher levels <strong>of</strong> dependency<br />
associated with lower use <strong>of</strong> residential care means that these groups need a share <strong>of</strong><br />
HACC resources that is above that indicated by their numeric representati<strong>on</strong> in the<br />
populati<strong>on</strong>.<br />
• 22% <strong>of</strong> Victoria’s populati<strong>on</strong> speak a language other than English (LOTE) at home;<br />
cultural diversity thus has the potential to have a substantial impact <strong>on</strong> need for HACC<br />
services.<br />
• Cultural diversity differs very markedly from LGA to LGA and presents HACC<br />
services with very different needs in different areas. In 42 LGAs, less than 8% <strong>of</strong> the<br />
populati<strong>on</strong> speaks a language other than English at home, and these LGAs receive no<br />
weighting.<br />
• The impact <strong>of</strong> cultural diversity <strong>on</strong> weighting is greatest in the small number <strong>of</strong> LGAs<br />
in which high proporti<strong>on</strong>s <strong>of</strong> the populati<strong>on</strong> speak a language other than English at<br />
home; in 10 LGAs, this proporti<strong>on</strong> was over <strong>on</strong>e third <strong>of</strong> the populati<strong>on</strong>.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 55
Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
Variable 3: Cultural Diversity<br />
Decile score % speaking LOTE No <strong>of</strong> LGAs % <strong>of</strong> LGAs<br />
0 2.66-7.80 42 53.85<br />
1 7.81-12.93 11 14.10<br />
2 12.94-18.07 4 5.13<br />
3 18.08-23.20 5 6.41<br />
4 23.21-28.33 3 3.85<br />
5 28.34-33.46 3 3.85<br />
6 33.47-38.60 4 5.13<br />
7 38.61-43.82 0 0<br />
8 43.83-48.86 3 3.85<br />
9 48.87-54.00 3 3.85<br />
Minimum 2.66 Moyne<br />
Median 7.35 Hepburn, Bass Coast<br />
Maximum 53.99 Brimbank<br />
Range 51.33<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 56
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 57
Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
VARIABLE 4: KOORI POPULATION - % OF LGA POPULATION IDENTIFYING<br />
AS KOORI<br />
Data Source:<br />
Census, updated every 5 years<br />
Issues:<br />
• The lower health status <strong>of</strong> Koori people has been widely documented. Many <strong>of</strong> these<br />
health problems are associated with chr<strong>on</strong>ic diseases, with Koori people experiencing<br />
earlier <strong>on</strong>set and more severe levels <strong>of</strong> illness and resulting disability than the rest <strong>of</strong> the<br />
populati<strong>on</strong>. For example, diabetes, heart disease and stroke are more comm<strong>on</strong> at early<br />
ages am<strong>on</strong>g the Koori populati<strong>on</strong> and all give rise to <strong>on</strong>-going need for nursing,<br />
pers<strong>on</strong>al care and allied health care and associated disability gives rise to a need for<br />
further assistance in activities <strong>of</strong> daily living.<br />
• Many Kooris require complex care and packages <strong>of</strong> services; these needs add to the<br />
volume <strong>of</strong> service required.<br />
• Recruitment and training <strong>of</strong> Koori staff and small scale <strong>of</strong> agencies serving Koori<br />
clients may also add to costs and are more appropriately dealt with through service<br />
development grants.<br />
• The Koori populati<strong>on</strong> accounts for approximately 1% <strong>of</strong> Victoria’s total populati<strong>on</strong>, but<br />
it is widely c<strong>on</strong>sidered that Koori identity is under-reported. The post census count<br />
increased the number <strong>of</strong> Kooris in Victoria by some 3000, an increase <strong>of</strong> around 16%.<br />
• The Koori populati<strong>on</strong> is very unevenly spread across the state. A large number <strong>of</strong><br />
LGAs have very small Koori populati<strong>on</strong>s; the 41 LGAs in the lowest decile receive no<br />
weighting for Koori populati<strong>on</strong>.<br />
• Only 3 LGAs have more than 2% Koori populati<strong>on</strong> and receive high weightings. These<br />
are all rural LGAs and have small total populati<strong>on</strong>s, so while the overall impact <strong>of</strong><br />
weighting for Koori populati<strong>on</strong> <strong>on</strong> the redistributi<strong>on</strong> <strong>of</strong> growth funds will be small; it<br />
will be resp<strong>on</strong>sive to localised need.<br />
• C<strong>on</strong>siderati<strong>on</strong> was given to using the number <strong>of</strong> Kooris in each LGA rather than the<br />
percentage share <strong>of</strong> the populati<strong>on</strong>. While the ranking <strong>of</strong> LGAs <strong>on</strong> both measures<br />
corresp<strong>on</strong>ded closely, use <strong>of</strong> absolute numbers meant that more LGAs received a higher<br />
scaled score and the c<strong>on</strong>tributi<strong>on</strong> <strong>of</strong> the Koori variable to the total model increased to a<br />
level equal to the cultural diversity variable; this outcome was seen to be<br />
disproporti<strong>on</strong>ate to the relative size <strong>of</strong> the Koori populati<strong>on</strong> and the populati<strong>on</strong> from<br />
culturally and linguistically diverse background. Use <strong>of</strong> percentage shares was<br />
therefore adopted, and gave c<strong>on</strong>sistency with other variables.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 58
Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
Variable 4: Koori Populati<strong>on</strong><br />
Decile score % Koori No <strong>of</strong> LGAs % <strong>of</strong> LGAs<br />
0 0.096-0.449 41 52.56<br />
1 0.450-0.802 26 33.33<br />
2 0.803-1.155 6 7.69<br />
3 1.156-1.507 1 1.28<br />
4 1.508-1.860 1 1.28<br />
5` 1.861-2.212 0 0<br />
6 2.213-2.565 1 1.28<br />
7 2.566-2.918 1 1.28<br />
8 2.919-3.270 0 0<br />
9 3.271-3.623 1 1.28<br />
Minimum 0.096 Manningham<br />
Median 0.422 Corangamite, Greater Danden<strong>on</strong>g<br />
Maximum 3.622 Swan Hill<br />
Range 3.526<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 59
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 60
Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
VARIABLE 5: ACCESSIBILITY AND REMOTENESS INDEX FOR AUSTRALIA -<br />
ARIA<br />
Data Source: Comm<strong>on</strong>wealth Dept. <strong>of</strong> <strong>Health</strong> and Aged Care and<br />
Centre for Social Applicati<strong>on</strong>s <strong>of</strong> Geographic Informati<strong>on</strong> Systems<br />
Issues:<br />
• Individual LGA scores <strong>on</strong> ARIA replace the 3 tier rural density weighting in the 1992<br />
<strong>RREF</strong>.<br />
• The 15 level ARIA provides a very discerning measure <strong>of</strong> accessibility and rurality<br />
across the whole state. The way the Index is c<strong>on</strong>structed, using a grid <strong>of</strong> local areas<br />
smaller than LGAs, captures travel distance to centres <strong>of</strong> difference sizes and so gives a<br />
good indicator <strong>of</strong> access to services that locate <strong>on</strong>ly in centres above certain sizes, such<br />
as Aged Care Assessment Services. It is a much more effective “real-world” measure<br />
<strong>of</strong> rurality than the arbitrary measure <strong>of</strong> density used in the 1992 <strong>RREF</strong>.<br />
• ARIA does not simply average the density <strong>of</strong> populati<strong>on</strong> across LGAs, but measures<br />
travel distance to centres <strong>of</strong> different sizes. A n<strong>on</strong>-metropolitan LGA in which most <strong>of</strong><br />
the populati<strong>on</strong> was located in a large provincial centre would rank as more accessible<br />
than an LGA with the same populati<strong>on</strong> but dispersed more evenly across the whole area.<br />
• Accessibility and remoteness is included as a variable associated with need for higher<br />
levels <strong>of</strong> service am<strong>on</strong>g the rural populati<strong>on</strong>, due to health status and limited access to<br />
alternative services, such as private allied health and social support services.<br />
• As performance targets are based <strong>on</strong> the level <strong>of</strong> funding made available through the<br />
<strong>RREF</strong>, any additi<strong>on</strong>al funding through the <strong>RREF</strong> lead to a higher performance target<br />
and so did not take account <strong>of</strong> higher costs associated with travel and other factors.<br />
• Low ARIA scores indicate low remoteness/high accessibility, and high scores show<br />
high remoteness/low accessibility.<br />
! 24 LGAs comprising the inner and middle distance suburbs <strong>of</strong> Melbourne have<br />
ARIA scores <strong>of</strong> 1 and so are scored 0 and receive no weighting.<br />
! urban fringe LGAs are well differentiated and have higher ARIA scores and so<br />
receive some weighting.<br />
! rural LGAs in which large provincial centres are located have higher accessibility to<br />
these centres and are less remote than more distant surrounding LGAs and so<br />
receive lower weightings.<br />
! the most distant and least accessible parts <strong>of</strong> the state receive the highest weighting.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 61
Part B: Development <strong>of</strong> Opti<strong>on</strong>s for a Revised <strong>RREF</strong><br />
Variable 5: Accessibility and Remoteness – ARIA<br />
Decile score ARIA Score No <strong>of</strong> LGAs % <strong>of</strong> LGAs<br />
0 0.00-0.55 24 30.77<br />
1 0.56-1.11 9 11.54<br />
2 1.12-1.67 10 12.82<br />
3 1.68-2.23 9 11.54<br />
4 2.24-2.79 9 11.54<br />
5 2.80-3.35 3 3.85<br />
6 3.36-3.91 7 8.97<br />
7 3.92-4.47 0 0<br />
8 4.48-5.03 3 3.85<br />
9 5.04-5.60 4 5.13<br />
Minimum 0 16 LGAs<br />
Median 1.37 Maced<strong>on</strong> Ranges<br />
Hepburn<br />
Maximum 5.59 Hindmarsh<br />
Range 5.59<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 62
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 63
PART C: OUTCOMES<br />
The Opti<strong>on</strong>s Paper presented results for modelling the <strong>RREF</strong> in three steps as set out in Chart 3<br />
below. A number <strong>of</strong> issues were raised in the Round 2 c<strong>on</strong>sultati<strong>on</strong>s and this secti<strong>on</strong> reports <strong>on</strong><br />
those discussi<strong>on</strong> and presents revised outcomes for Step 5,6 and 7, incorporating the preferred<br />
opti<strong>on</strong>s identified in Steps 1-4 and reference is made to marked differences between these<br />
revised outcomes and the initial outcomes where relevant.<br />
Chart 3: Modelling <strong>of</strong> Opti<strong>on</strong>s<br />
STEP 5: OUTCOMES OF OPTIONS<br />
FOR<br />
STEP 6: REGIONAL OUTCOMES OF<br />
WEIGHTING FOR NEED VARIABLES<br />
5.1 Base populati<strong>on</strong> opti<strong>on</strong>s<br />
compared to current <strong>RREF</strong><br />
5.2 Projecti<strong>on</strong>s to 2006<br />
< OPTIONS ><br />
6.1 Regi<strong>on</strong>al Outcomes<br />
compared to current <strong>RREF</strong><br />
STEP 7: OPTIONS FOR REGIONAL ALLOCATION OF<br />
GROWTH FUNDS<br />
7.1 Changes in overall allocati<strong>on</strong>s<br />
7.2 Changes in Regi<strong>on</strong>al Allocati<strong>on</strong>s<br />
< OPTIONS ><br />
7.3 6 and 4 variable models<br />
7.4 Even or different weighting<br />
OUTCOMES FOR REVISED <strong>RREF</strong><br />
INCORPORATING PREFERRED OPTIONS<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 64
Part C: Outcomes<br />
In the initial modelling, all data sets were compiled at LGA level before being aggregated to the<br />
regi<strong>on</strong>al level, and LGA level data were retained in all the revised modelling. The size <strong>of</strong> these<br />
data sets and the complexity <strong>of</strong> modelling is again emphasised:<br />
• there are 78 LGAs in Victoria;<br />
• there are 20 age groups in each LGA;<br />
• each with a different age-specific rate <strong>of</strong> handicap;<br />
• each LGA is scored for five variables;<br />
• projecti<strong>on</strong>s are then made for each LGA to take account <strong>of</strong> total populati<strong>on</strong> growth and<br />
changes in age structure, and c<strong>on</strong>sequent changes in handicap over the period 2002-<br />
2006;<br />
• the current <strong>RREF</strong> and three further base populati<strong>on</strong> opti<strong>on</strong>s are modelled, with<br />
modificati<strong>on</strong>s made to two <strong>of</strong> the base populati<strong>on</strong> opti<strong>on</strong>s in revised modelling;<br />
• initial opti<strong>on</strong>s were modelled with six variables and with <strong>on</strong>ly four variables, and<br />
• the effects <strong>of</strong> giving double weighting to selected variables are also modelled for the<br />
initial and revised opti<strong>on</strong>s.<br />
All modelling has been carried out independently by the two members <strong>of</strong> the Review Team with<br />
statistical and actuarial skills and then cross-checked. Small differences will however remain<br />
due to rounding and other mathematical aspects <strong>of</strong> data processing<br />
The revised results presented in the next steps should not be taken as final. Even when a<br />
decisi<strong>on</strong> is made <strong>on</strong> the <strong>RREF</strong> that is to be used in future, new data may become available and<br />
further refinements made before any revised <strong>RREF</strong> is implemented.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 65
Part C: Outcomes<br />
Step 5: Outcomes for Base Populati<strong>on</strong> Opti<strong>on</strong>s and Projecti<strong>on</strong>s<br />
5.1 FACTORS AFFECTING OUTCOMES<br />
Initial outcomes for modelling three base populati<strong>on</strong>s were presented in the Opti<strong>on</strong>s Paper and<br />
compared to the current <strong>RREF</strong> base populati<strong>on</strong> without the weighting for rurality. This baseline<br />
is labelled Base <strong>RREF</strong>. Differences between the initial outcomes and revised outcomes were<br />
minor and <strong>on</strong>ly the revised outcomes are reported here.<br />
The factors affecting outcomes were identified as:<br />
1. the more accurate definiti<strong>on</strong> <strong>of</strong> those living in the community by<br />
exclusi<strong>on</strong> <strong>of</strong> residents in aged residential care and disability<br />
accommodati<strong>on</strong>, and exclusi<strong>on</strong> <strong>of</strong> the veteran populati<strong>on</strong> eligible for the<br />
DVA Home Care Program in all opti<strong>on</strong>s, compared to Base <strong>RREF</strong><br />
which excludes <strong>on</strong>ly those 85 and over in aged residential care;<br />
2. the adjustments made for the frail aged in each opti<strong>on</strong> compared to<br />
Base <strong>RREF</strong>, which includes all those aged 85 and over living in the<br />
community with or without any level <strong>of</strong> handicap.<br />
Two provisos have to be kept in mind in c<strong>on</strong>sidering both the results reported in Tables 5.1 and<br />
5.2:<br />
1. the comparis<strong>on</strong>s did not include any weighting for need factors.<br />
2. the total base populati<strong>on</strong> given in the tables are for “pers<strong>on</strong>s”, but the<br />
figures do not corresp<strong>on</strong>d to individuals in the HACC target populati<strong>on</strong><br />
but reflect the different comp<strong>on</strong>ents taken into account in defining each<br />
opti<strong>on</strong> and the adjustment for the frail aged.<br />
5.2 OPTIONS FOR CONSIDERATION FOR BASE POPULATIONS AND<br />
PROJECTIONS<br />
The results <strong>of</strong> the initial modelling for three opti<strong>on</strong>s for the <strong>RREF</strong> base populati<strong>on</strong> were<br />
presented in the Opti<strong>on</strong>s Paper and views <strong>on</strong> these outcomes were sought in the Round 2<br />
C<strong>on</strong>sultati<strong>on</strong>s. The opti<strong>on</strong>s for discussi<strong>on</strong> were presented as follows:<br />
How different are<br />
the base<br />
populati<strong>on</strong><br />
opti<strong>on</strong>s?<br />
• Comparis<strong>on</strong>s are made with the current <strong>RREF</strong> without the<br />
weighting for rurality, labelled Base <strong>RREF</strong><br />
• Differences between the opti<strong>on</strong>s reflect<br />
- the adjustment made for the frail aged in each opti<strong>on</strong><br />
- the age structure <strong>of</strong> each regi<strong>on</strong>.<br />
How do the <strong>RREF</strong><br />
base populati<strong>on</strong>’s<br />
change by 2006?<br />
• Outcomes <strong>of</strong> projecti<strong>on</strong>s for regi<strong>on</strong>s reflect underlying<br />
demographic trends, particularly the absolute and relative<br />
growth <strong>of</strong> the populati<strong>on</strong> aged 70 and over and the old-old.<br />
• Underlying demographic trends will have a significant effect<br />
throughout all further opti<strong>on</strong>s.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 66
Part C: Outcomes<br />
5.3 FURTHER ISSUES AND VIEWS ON OUTCOMES<br />
The <strong>on</strong>ly issue arising from the results <strong>of</strong> the base populati<strong>on</strong>s presented in the Opti<strong>on</strong>s Paper<br />
was some discussi<strong>on</strong> about the relevance <strong>of</strong> the size <strong>of</strong> the different base populati<strong>on</strong>s. As<br />
already noted, while some preference was expressed for Base 2 as it produced a larger<br />
populati<strong>on</strong>, the absolute size <strong>of</strong> the populati<strong>on</strong> does not have a bearing <strong>on</strong> the total level <strong>of</strong><br />
resources made available to HACC or regi<strong>on</strong>al shares <strong>of</strong> those resources.<br />
5.4 MODELING REVISED OPTIONS FOR BASE POPULATIONS<br />
• In line with the balance <strong>of</strong> preferences for Base 2 and Base 3 with regard to the<br />
adjustment for the frail aged, both opti<strong>on</strong>s for the revised <strong>RREF</strong> in 2002 are presented<br />
in Table 5.1 and projecti<strong>on</strong>s to 2006 in Table 5.2.<br />
• The Base 2 and Base 3 Opti<strong>on</strong>s include the other adjustments in the base populati<strong>on</strong>s as<br />
detailed in Step 1.<br />
• Two provisos should be noted for the current <strong>RREF</strong> base populati<strong>on</strong>:<br />
1. The figures are not weighted for rurality.<br />
2. The veteran populati<strong>on</strong> eligible for the VHC has not been deducted for either 2002<br />
or for 2006. However, such an adjustment would be highly likely in the event <strong>of</strong><br />
c<strong>on</strong>tinuati<strong>on</strong> <strong>of</strong> the current <strong>RREF</strong>.<br />
5.5 REVISED OUTCOMES FOR BASE POPULATIONS<br />
Comparis<strong>on</strong> <strong>of</strong> the revised outcomes for the base populati<strong>on</strong>s shows:<br />
Base 1 which includes <strong>on</strong>ly those with moderate, severe and pr<strong>of</strong>ound levels <strong>of</strong> handicap at all<br />
ages, with no adjustment for the frail aged, generated a smaller total base populati<strong>on</strong>, 20.3% less<br />
than Base <strong>RREF</strong>. Base 1 was included to this point to illustrate the impact <strong>of</strong> adjustments for the<br />
frail aged comp<strong>on</strong>ent <strong>of</strong> the HACC target populati<strong>on</strong> in Base 2 and 3. As there was str<strong>on</strong>g<br />
support for adjusting for the frail aged populati<strong>on</strong> to a greater extent than in the current <strong>RREF</strong>,<br />
no further results are presented for modelling <strong>on</strong> Base 1.<br />
Base 2 generates a much larger total base populati<strong>on</strong>, 47.3% larger than Base <strong>RREF</strong>, because it<br />
includes the populati<strong>on</strong> with moderate, severe or pr<strong>of</strong>ound handicap to age 70, plus the total<br />
populati<strong>on</strong> aged 70 and over.<br />
Base 3 generates an intermediate total base populati<strong>on</strong>, 18.1% larger than Base <strong>RREF</strong>, because<br />
it includes the populati<strong>on</strong> with moderate, severe or pr<strong>of</strong>ound handicap to age 70, plus double the<br />
handicapped populati<strong>on</strong> aged 70 and over. The smaller overall difference shows that doubling<br />
the handicapped aged in the community makes a more substantial adjustment for the frail aged<br />
comp<strong>on</strong>ent <strong>of</strong> the base populati<strong>on</strong> than the subtracti<strong>on</strong> <strong>on</strong>ly <strong>of</strong> residents aged 85 and over in<br />
Base <strong>RREF</strong> then inclusi<strong>on</strong> <strong>of</strong> the balance <strong>of</strong> all those aged 85 and over. Base 3 represent the<br />
starting point closest to the current <strong>RREF</strong> (without the rural weighting).<br />
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Several features <strong>of</strong> the base populati<strong>on</strong> opti<strong>on</strong>s warrant note:<br />
Part C: Outcomes<br />
• The differences between the regi<strong>on</strong>al shares are very minor, for both years. This<br />
outcome means that weighting the base populati<strong>on</strong>s for need will potentially have a<br />
greater difference in regi<strong>on</strong>al shares <strong>of</strong> resource than differences in the definiti<strong>on</strong> <strong>of</strong> the<br />
base populati<strong>on</strong>s.<br />
• Rates <strong>of</strong> growth to 2006 are given in Table 5.2. The higher rate <strong>of</strong> increase for Base 3,<br />
8.2% overall, reflects the more rapid growth <strong>of</strong> the old-old populati<strong>on</strong>, am<strong>on</strong>g which<br />
prevalence <strong>of</strong> handicap is higher, whereas the lower growth for Base 2, 6.3% overall,<br />
reflects the lower rate <strong>of</strong> increase in the young-old populati<strong>on</strong>. Again, there are some<br />
rural and some metropolitan regi<strong>on</strong>s with above and below average growth rates.<br />
• The higher rate <strong>of</strong> growth <strong>of</strong> Base Populati<strong>on</strong> 3 means it is likely to bring greater<br />
changes in resource allocati<strong>on</strong> over time than Base Populati<strong>on</strong> 2 which changes more<br />
slowly.<br />
Table 5.1: Comparis<strong>on</strong> <strong>of</strong> Opti<strong>on</strong>s for revised <strong>RREF</strong> Base Populati<strong>on</strong>, 2002<br />
Base Populati<strong>on</strong> Base <strong>RREF</strong> Base 1 Base 2 Base 3<br />
A: Number 424,100 337,946 624,771 500,838<br />
Compared to Base <strong>RREF</strong> -20.3% +47.3% +18.1%<br />
B. Regi<strong>on</strong>al Shares % share % share % share % share<br />
Barw<strong>on</strong> South Western 7.5 7.2 7.8 7.6<br />
Grampians 4.5 4.2 4.6 4.5<br />
Lodd<strong>on</strong> Mallee 6.4 6.0 6.4 6.3<br />
Hume 5.3 5.2 5.3 5.3<br />
Gippsland 5.4 5.5 5.8 5.6<br />
Western 11.5 12.4 11.3 11.5<br />
Northern 15.1 15.6 14.8 14.9<br />
Eastern 20.2 20.5 20.0 20.3<br />
Southern 24.0 23.5 24.0 24.0<br />
Total % 100.0 100.0 100.0 100.0<br />
Table 5.2: Growth <strong>of</strong> Base Populati<strong>on</strong>s, 2002 to 2006<br />
Regi<strong>on</strong> Regi<strong>on</strong>al share in 2006 % growth 2002 to 2006<br />
Base Base 2 Base 3 Base Base 2 Base 3<br />
<strong>RREF</strong><br />
<strong>RREF</strong><br />
No. 450,185 664,545 539,677<br />
Barw<strong>on</strong> South<br />
7.4 7.7 7.6 5.1 5.1 7.0<br />
West<br />
Grampians 4.5 4.5 4.5 4.7 5.8 6.7<br />
Lodd<strong>on</strong> Mallee 6.4 6.4 6.3 5.8 6.4 7.7<br />
Hume 5.4 5.4 5.3 6.6 7.5 8.4<br />
Gippsland 5.5 5.9 5.8 7.5 8.2 9.9<br />
Western 11.7 11.5 11.7 8.3 8.6 9.8<br />
Northern 15.1 14.9 14.9 6.2 6.8 7.9<br />
Eastern 19.9 19.7 20.0 4.8 5.1 6.1<br />
Southern 24.1 23.9 24.0 6.5 5.9 7.8<br />
Total 100.0 100.0 100.0 6.2 6.4 7.8<br />
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Part C: Outcomes<br />
Step 6: Outcomes <strong>of</strong> weighting for need variables<br />
6.1 METHOD AND OUTCOMES REPORTED<br />
Two sets <strong>of</strong> results were reported in the Opti<strong>on</strong>s Paper for the initial opti<strong>on</strong>s <strong>of</strong> weighting for six<br />
need variables, and the same results are reported here for the revised opti<strong>on</strong>s for the five<br />
variables selected for weighting for need, namely average need weightings for regi<strong>on</strong>s in Table<br />
6.1 and comparis<strong>on</strong>s with weightings for the current <strong>RREF</strong> in Table 6.2. In additi<strong>on</strong>, the scaled<br />
need scores for LGAs and percentage weightings are reported in Appendix 3.<br />
Weighting for the five need variables involved three steps:<br />
1. Scoring each variable for each LGA <strong>on</strong> a scale from 0 to 9, with high scores<br />
representing high need for HACC services.<br />
2. Adding the scaled scores from 0 to 9 for each LGA to obtain a total score for<br />
each LGA out <strong>of</strong> a possible maximum <strong>of</strong> 45 (5 x 9);<br />
3. C<strong>on</strong>verting these scores out <strong>of</strong> 45 to percentages.<br />
6.2 OPTIONS FOR CONSIDERATION FOR WEIGHTING OF NEED<br />
VARIABLES<br />
The outcomes <strong>of</strong> taking the initial six need variables into account were reported at regi<strong>on</strong>al level<br />
in the Opti<strong>on</strong>s Paper and LGA level data were also presented at the Round 2 c<strong>on</strong>sultati<strong>on</strong>s. The<br />
c<strong>on</strong>sultati<strong>on</strong>s sought views <strong>on</strong> the outcomes as follow:<br />
The <strong>RREF</strong> allocates<br />
resources <strong>on</strong> the basis <strong>of</strong><br />
relative need, and weighting<br />
for the six need factors<br />
shows variati<strong>on</strong>s in relative<br />
need<br />
• Do the regi<strong>on</strong>al weightings accord with your<br />
understanding <strong>of</strong> variati<strong>on</strong>s in need?<br />
Opti<strong>on</strong>s for even and<br />
different weighting <strong>of</strong> the<br />
need variables are to be<br />
modelled to illustrate the<br />
effects <strong>of</strong> these approaches<br />
to weighting<br />
• It is important to understand that even<br />
weighting does not mean that all need<br />
variables make the same c<strong>on</strong>tributi<strong>on</strong> to the<br />
model, but that this depends <strong>on</strong> the actual<br />
distributi<strong>on</strong> <strong>of</strong> scaled scores at LGA level.<br />
• Have the opti<strong>on</strong>s for weighting <strong>of</strong> need<br />
variable been adequately explained?<br />
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Part C: Outcomes<br />
6.3 FURTHER ISSUES AND VIEWS ON OUTCOMES<br />
• There was wide agreement in the Round 2 C<strong>on</strong>sultati<strong>on</strong>s that the patterns <strong>of</strong> need shown by<br />
the need weightings at regi<strong>on</strong>al level and for LGAs reflected experience in the field. Three<br />
aspects <strong>of</strong> the results were noted in particular:<br />
1. The relatively limited gradati<strong>on</strong> in the average need weightings across the nine<br />
regi<strong>on</strong>s;<br />
2. The more marked variati<strong>on</strong>s between LGAs within regi<strong>on</strong>s; and<br />
3. The insights into variati<strong>on</strong>s in need within regi<strong>on</strong>s provided by the LGA data<br />
compiled for the <strong>RREF</strong> and the value <strong>of</strong> having this data available for use in<br />
regi<strong>on</strong>al and local planning.<br />
6.4 REVISED REGIONAL OUTCOMES OF WEIGHTING FOR NEED VARIABLES<br />
Average weightings across all LGAs in each regi<strong>on</strong> are ranked as set out in Table 6.1. While<br />
there was a 29% difference between the lowest and highest average percentage weightings, from<br />
18% to 47%, seven <strong>of</strong> the nine regi<strong>on</strong>s were within a range <strong>of</strong> 13%. All rural regi<strong>on</strong>s receive a<br />
weighting <strong>of</strong> at least 30%.<br />
Table 6.1: Average Weightings for Regi<strong>on</strong>s<br />
Rank<br />
Regi<strong>on</strong><br />
Weighting<br />
Average for all Lowest Highest Range<br />
LGAs<br />
LGA LGA<br />
Lowest Eastern Metropolitan 18 11 27 16<br />
Southern Metropolitan 26 9 51 42<br />
Northern Metropolitan 35 ) 9 56 47<br />
Western Metropolitan 36 ) 18 58 40<br />
Barw<strong>on</strong> South Western 39 ) 7 regi<strong>on</strong>s 29 44 15<br />
Hume 39 ) within 12% 29 47 18<br />
Grampians 43 ) range 29 58 29<br />
Gippsland 44 ) 34 67 33<br />
Highest Lodd<strong>on</strong>-Mallee 47 ) 24 71 47<br />
The highest and lowest LGA weightings within each regi<strong>on</strong> show that there is as much variati<strong>on</strong><br />
between LGAs within each regi<strong>on</strong> as between regi<strong>on</strong>s. The highest score for any individual<br />
LGA was 32/45, giving a weighting <strong>of</strong> 71%, and the lowest was 4/45, giving a weighting <strong>of</strong> 9%.<br />
Comparis<strong>on</strong>s that highlight this intra-regi<strong>on</strong>al variati<strong>on</strong>s are:<br />
• The Eastern Metropolitan regi<strong>on</strong> is characterised by less variati<strong>on</strong> within the regi<strong>on</strong>;<br />
further, the highest need weighting for any LGA in this regi<strong>on</strong>, 24%, is comparable<br />
to the lowest need weighting in the five rural regi<strong>on</strong>s.<br />
• Barw<strong>on</strong> South Western and Hume have similar lowest and highest LGA need<br />
weightings and there is less variati<strong>on</strong> between LGAs within these regi<strong>on</strong>s, less than<br />
20%.<br />
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Part C: Outcomes<br />
• The Northern and Southern Metropolitan Regi<strong>on</strong>s and Lodd<strong>on</strong> Mallee are<br />
characterised by extreme variati<strong>on</strong>, more than 40%, between LGAs within each<br />
regi<strong>on</strong>;<br />
• Gippsland stands out as having similarly high levels <strong>of</strong> need across all LGAs,<br />
starting from a highest base, 31%, with a range <strong>of</strong> 33%.<br />
In applying the need weightings to determine regi<strong>on</strong>al allocati<strong>on</strong>s <strong>of</strong> growth funds, it needs to be<br />
emphasised that:<br />
• The share <strong>of</strong> growth funds received will depend <strong>on</strong> the size <strong>of</strong> the total populati<strong>on</strong><br />
<strong>of</strong> each LGA as well as the weighting.<br />
• The average <strong>of</strong> the weightings across the LGAs in each regi<strong>on</strong> is given for<br />
comparis<strong>on</strong> purposes <strong>on</strong>ly and does not translate into the weighted populati<strong>on</strong> for<br />
the regi<strong>on</strong>, nor can growth funds for regi<strong>on</strong>s be estimated simply by applying the<br />
average weighting to the base resources currently received. The weighted regi<strong>on</strong>al<br />
populati<strong>on</strong>s for the <strong>RREF</strong> are built by adding the weighted base populati<strong>on</strong> for each<br />
LGA, these regi<strong>on</strong>al totals are then calculated as a share <strong>of</strong> the total <strong>RREF</strong> weighted<br />
base populati<strong>on</strong> for the state, and growth funds are allocated in proporti<strong>on</strong> to those<br />
shares.<br />
6.5 COMPARISON WITH CURRENT <strong>RREF</strong><br />
The distributi<strong>on</strong> <strong>of</strong> weightings in the revised <strong>RREF</strong> set out in Table 6.2 show that it provides a<br />
much more fine-grained recogniti<strong>on</strong> <strong>of</strong> need than the current <strong>RREF</strong>.<br />
Table 6.2: Comparis<strong>on</strong> <strong>of</strong> need weightings for rural and metropolitan regi<strong>on</strong>s<br />
Weighting Metropolitan LGAs Rural LGAs Total<br />
Revised Revised Revised<br />
Under 10% 2 2<br />
10-19% 7 7<br />
20-29% 10 5 15<br />
30-39% 6 15 21<br />
40-49% 3 19 22<br />
50-59% 3 5 8<br />
Over 60% 3 3<br />
Total 31 47 78<br />
Under the current <strong>RREF</strong>: Metropolitan LGAs and regi<strong>on</strong>s received no weighting for any need<br />
factors and <strong>on</strong>ly a few fringe areas rural areas received a weighting <strong>on</strong>ly for rurality, with most<br />
rural LGAs receiving the maximum weighting <strong>of</strong> close to 30%. The result was that the State<br />
was effectively divided into two – metropolitan areas with no weightings, and rural areas with a<br />
high and fairly uniform weighting. That outcome gave <strong>on</strong>ly a very crude recogniti<strong>on</strong> to<br />
variati<strong>on</strong>s in need between rural and metropolitan areas and failed to recognise variati<strong>on</strong>s within<br />
either. While the 30% rural weighting was arbitrary, it provides a c<strong>on</strong>venient benchmark for<br />
reporting outcomes <strong>of</strong> the revised <strong>RREF</strong>, as set out in Table 6.2.<br />
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Part C: Outcomes<br />
Under the revised <strong>RREF</strong>: 24 LGAs have weightings <strong>of</strong> less than 30%; <strong>of</strong> these, 19 are in<br />
metropolitan regi<strong>on</strong>s and <strong>on</strong>ly 5 are in rural regi<strong>on</strong>s, reflecting the locati<strong>on</strong> <strong>of</strong> large provincial<br />
centres.<br />
54 LGAs have weightings <strong>of</strong> 30% <strong>of</strong> more; <strong>of</strong> these, <strong>on</strong>ly 12 are in metropolitan regi<strong>on</strong>s and 42<br />
are in rural regi<strong>on</strong>s.<br />
6.6 DETAILED LGA SCALED SCORES AND NEED WEIGHTINGS<br />
• The LGA scaled scores <strong>on</strong> the five need variables, total scores and percentage weightings<br />
used to compile Tables 6.1 and 6.2 are set out in full in Appendix 3.<br />
• These results are useful in dem<strong>on</strong>strating the way in which different need variables<br />
c<strong>on</strong>tributed to overall need in each LGA and highlight the need factors that c<strong>on</strong>tribute to<br />
variati<strong>on</strong>s in need between LGAs within any <strong>on</strong>e regi<strong>on</strong> as well as between regi<strong>on</strong>s.<br />
Step 7: Outcomes for Regi<strong>on</strong>al Allocati<strong>on</strong> <strong>of</strong> Growth Funds<br />
7.1 DEVELOPMENT OF INITIAL AND REVISED <strong>RREF</strong> OPTIONS<br />
Methods<br />
The modelling procedures used to develop the opti<strong>on</strong>s presented in the Opti<strong>on</strong>s Paper and for<br />
the subsequent revisi<strong>on</strong>s are the same, and involved three steps bey<strong>on</strong>d the development <strong>of</strong> the<br />
base populati<strong>on</strong>s and projecti<strong>on</strong>s already reported:<br />
1. Calculating the base populati<strong>on</strong>s in each LGA, weighted for need,<br />
2. Adding LGA results to give regi<strong>on</strong>al totals and the state total,<br />
3. Allocating the available growth funds in proporti<strong>on</strong> to the weighted base populati<strong>on</strong> in<br />
each regi<strong>on</strong>.<br />
The Opti<strong>on</strong>s Paper provided illustrative examples <strong>of</strong> models with all six <strong>of</strong> the initial variables<br />
or <strong>on</strong>ly four, and with and without adjustment to the weighting <strong>of</strong> selected need variables.<br />
Preferred opti<strong>on</strong>s for the number <strong>of</strong> variables and adjustment to need weightings were<br />
canvassed in the Round 2 C<strong>on</strong>sultati<strong>on</strong>s, and revised models then prepared incorporating these<br />
preferences.<br />
<str<strong>on</strong>g>Report</str<strong>on</strong>g>ing <strong>of</strong> outcomes<br />
Outcomes <strong>of</strong> the models are reported in terms <strong>of</strong> the share <strong>of</strong> growth funds allocated to regi<strong>on</strong>s.<br />
Outcomes as regi<strong>on</strong>al shares <strong>of</strong> growth funds were adopted because <strong>of</strong> the uncertainties in<br />
predicting actual dollar allocati<strong>on</strong>s, which are dependent <strong>on</strong> both the level <strong>of</strong> growth funds made<br />
available in both Comm<strong>on</strong>wealth and State budget processes.<br />
The percentage shares predicted under different <strong>RREF</strong> models provide <strong>on</strong>ly a guide to the actual<br />
amounts <strong>of</strong> HACC funds that regi<strong>on</strong>s will receive in any year as there will be <strong>on</strong>-going change<br />
due to the available growth funds, c<strong>on</strong>tinuing change in populati<strong>on</strong>s and projecti<strong>on</strong>s, and the<br />
scores <strong>on</strong> need variables included in the models. Further, additi<strong>on</strong>al funding may be available<br />
for special initiatives; the priority areas and amounts <strong>of</strong> these funds will vary from year to year.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 72
Part C: Outcomes<br />
By way <strong>of</strong> illustrati<strong>on</strong>, the distributi<strong>on</strong> <strong>of</strong> HACC funds in 2000-01 above the previous year’s<br />
base funding is shown in Table 7.1.<br />
Table 7.1: HACC growth funds and other funding above base funds, 2000-01<br />
Regi<strong>on</strong> $’000 % share<br />
Barw<strong>on</strong> South Western 1,081 8.5<br />
Grampians 684 5.4<br />
Lodd<strong>on</strong>-Mallee 985 7.8<br />
Hume 808 6.4<br />
Gippsland 805 6.4<br />
Western 1,319 10.4<br />
Northern 1,762 13.9<br />
Eastern 2,410 19.0<br />
Southern 2,805 22.2<br />
Regi<strong>on</strong>al Total 12,659 100.00<br />
The regi<strong>on</strong>al shares do not corresp<strong>on</strong>d exactly to the shares <strong>of</strong> growth funds allocated via the<br />
<strong>RREF</strong> as the funds include the adjustment factor for bringing per capita allocati<strong>on</strong>s to equity<br />
under the current <strong>RREF</strong> and also a special State <strong>on</strong>ly funding for Adult Day Activity Services<br />
(ADAS) which was allocated <strong>on</strong> the basis <strong>of</strong> the populati<strong>on</strong> aged 70 years and over who were<br />
living in the community and received the Age Pensi<strong>on</strong>. At the same time, cross-regi<strong>on</strong>al<br />
allocati<strong>on</strong>s, statewide and central <strong>of</strong>fice funded projects are excluded.<br />
In additi<strong>on</strong> to possible future adjustments to any <strong>RREF</strong> formula, regi<strong>on</strong>al funding levels will<br />
also be affected by a number <strong>of</strong> factors external to the <strong>RREF</strong> that relate to the cost <strong>of</strong> service<br />
delivery and which need to be c<strong>on</strong>sidered in the distributi<strong>on</strong> <strong>of</strong> funds. The <strong>RREF</strong> is used <strong>on</strong>ly to<br />
determine how available growth funds should be shared between regi<strong>on</strong>s, and other mechanisms<br />
are used to establish unit pricing and performance targets for different HACC services. The<br />
view clearly expressed in the first round <strong>of</strong> c<strong>on</strong>sultati<strong>on</strong>s was that other measures besides the<br />
<strong>RREF</strong> were required to deal with these cost drivers and other particular aspects <strong>of</strong> service<br />
delivery. These factors were raised in the C<strong>on</strong>sultati<strong>on</strong> Paper and discussed further in the last<br />
secti<strong>on</strong> <strong>of</strong> the Opti<strong>on</strong>s Paper and in the Round 2 C<strong>on</strong>sultati<strong>on</strong>s, and are taken up again in<br />
Secti<strong>on</strong> 8 <strong>of</strong> this <str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g>.<br />
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Part C: Outcomes<br />
7.2 COMPARISON OF CONTINUATION OF CURRENT <strong>RREF</strong> AND INITIAL<br />
OPTIONS<br />
Range <strong>of</strong> initial opti<strong>on</strong>s<br />
A total <strong>of</strong> 12 initial opti<strong>on</strong>s were modelled to illustrate how different approaches to adjusting the<br />
weighting <strong>of</strong> need factors and inclusi<strong>on</strong> <strong>of</strong> 4 or 6 variables affected the regi<strong>on</strong>al allocati<strong>on</strong> <strong>of</strong><br />
growth funds. These opti<strong>on</strong>s were modelled for the initial Base Populati<strong>on</strong>s 2 and 3, as follow:<br />
Opti<strong>on</strong> Initial Base<br />
Populati<strong>on</strong><br />
Weighting <strong>of</strong> need<br />
variables<br />
Number <strong>of</strong> need<br />
variables<br />
Current <strong>RREF</strong> Rurality <strong>on</strong>ly<br />
(1) Base 2 Even 4<br />
(2) Base 2 Even 6<br />
(3) Base 2 SES x 2 4<br />
(4) Base 2 SES x 2 6<br />
(5) Base 2 ARIA x 2 4<br />
(6) Base 2 ARIA x 2 6<br />
(7) Base 3 Even 4<br />
(8) Base 3 Even 6<br />
(9) Base 3 SES x 2 4<br />
(10) Base 3 SES x 2 6<br />
(11) Base 3 ARIA x 2 4<br />
(12) Base 3 ARIA x 2 6<br />
One <strong>of</strong> the rati<strong>on</strong>ales in modelling opti<strong>on</strong>s with <strong>on</strong>ly four variable models was that while<br />
recognising that a great many variables c<strong>on</strong>tribute to differences in the need for HACC services<br />
between LGAs and regi<strong>on</strong>s, the <strong>RREF</strong> formula has to focus <strong>on</strong> a small number <strong>of</strong> key variables.<br />
The variables excluded from the four variable models were:<br />
1. life expectancy, <strong>on</strong> grounds <strong>of</strong> high correlati<strong>on</strong> and hence duplicati<strong>on</strong> with median<br />
household income; and<br />
2. residential care shortfall, <strong>on</strong> grounds <strong>of</strong> the difficulty <strong>of</strong> allocating excess beds in<br />
some LGAs to adjacent LGAs with shortfalls, and in projecting changes in<br />
residential care provisi<strong>on</strong>.<br />
Other models could have been developed with any <strong>of</strong> the other variables excluded. However, as<br />
the remaining variables c<strong>on</strong>tributed less to the overall model, as detailed in Step 4 above, there<br />
would be less change in outcomes.<br />
The current <strong>RREF</strong> and all the other opti<strong>on</strong>s are c<strong>on</strong>strained by the total amount <strong>of</strong> growth funds<br />
being fixed, so that redistributi<strong>on</strong> <strong>of</strong> funds am<strong>on</strong>g regi<strong>on</strong>s has to balance out. The result is that<br />
all regi<strong>on</strong>s c<strong>on</strong>tinue to receive growth funds, however the 12 opti<strong>on</strong>s show different regi<strong>on</strong>al<br />
shares than would be expected under the c<strong>on</strong>tinuati<strong>on</strong> <strong>of</strong> the current <strong>RREF</strong>.<br />
Outcomes <strong>of</strong> initial opti<strong>on</strong>s<br />
Whilst, the regi<strong>on</strong>al shares <strong>of</strong> growth funds projected for 2002 under the current <strong>RREF</strong> provide<br />
a basis for comparis<strong>on</strong> <strong>of</strong> outcomes <strong>of</strong> other models, it should be remembered that the outcome<br />
under the current <strong>RREF</strong> is not fixed and that there would be further changes in the allocati<strong>on</strong> <strong>of</strong><br />
resources between regi<strong>on</strong>s if the current <strong>RREF</strong> were to c<strong>on</strong>tinue. C<strong>on</strong>tinuing reallocati<strong>on</strong> <strong>of</strong><br />
growth funds would come about due to changes in regi<strong>on</strong>al populati<strong>on</strong>s over time, and<br />
c<strong>on</strong>tinuing adjustments to achieve per capita equity as defined by the current <strong>RREF</strong>. Further,<br />
there would be likely to be an adjustment for the VHC in any c<strong>on</strong>tinuati<strong>on</strong> <strong>of</strong> the current <strong>RREF</strong>.<br />
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Part C: Outcomes<br />
The outcomes <strong>of</strong> the 12 initial opti<strong>on</strong>s were discussed in detail in the Opti<strong>on</strong>s Paper and are<br />
summarised here in Table 7.2. This summary table was presented and discussed at the Round 2<br />
C<strong>on</strong>sultati<strong>on</strong>s to illustrate the diversity <strong>of</strong> outcomes generated by different models. To highlight<br />
this diversity:<br />
• the maximum share for each regi<strong>on</strong> under any opti<strong>on</strong> is shown in bold.<br />
• the minimum share for each regi<strong>on</strong> under any opti<strong>on</strong> is shown in italics and underlined.<br />
Table 7.2: Comparis<strong>on</strong> <strong>of</strong> outcomes for current <strong>RREF</strong> and 12 initial opti<strong>on</strong>s<br />
Base Populati<strong>on</strong> Current Base Populati<strong>on</strong> 2 Base Populati<strong>on</strong> 3<br />
Weighting<br />
<strong>RREF</strong><br />
Even SES X 2 ARIA X 2 Even SES X 2 ARIA X 2<br />
No. <strong>of</strong> variables<br />
4 6 4 6 4 6 4 6 4 6 4 6<br />
Column number (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) (13)<br />
Refer to Table 10 11 10 12 12 13 13 11 10 12 12 13 13<br />
Barw<strong>on</strong> S-West 7.73 7.95 8.00 8.18 8.15 8.06 8.07 7.35 7.40 7.57 7.54 7.46 7.47<br />
Grampians 5.17 4.68 4.63 4.83 4.74 4.83 4.74 4.36 4.32 4.50 4.43 4.49 4.42<br />
Lodd<strong>on</strong> Mallee 7.59 6.96 6.78 7.07 6.89 7.20 6.97 6.37 6.21 6.48 6.32 6.60 6.39<br />
Hume 6.26 5.67 5.55 5.78 5.64 5.84 5.68 5.43 5.31 5.54 5.40 5.59 5.44<br />
Gippsland 6.37 6.38 6.48 6.49 6.54 6.63 6.64 6.21 6.31 6.32 6.37 6.45 6.46<br />
Western Metro 10.77 11.62 11.72 11.51 11.62 11.33 11.50 12.85 12.93 12.74 12.84 12.55 12.71<br />
Northern Metro 14.16 15.45 15.35 15.24 15.22 15.09 15.12 16.25 16.13 16.04 16.00 15.91 15.91<br />
Eastern Metro 19.35 18.28 17.99 17.84 17.73 18.28 18.03 18.53 18.23 18.11 17.99 18.56 18.29<br />
Southern Metro 22.60 23.01 23.49 23.07 23.46 22.75 23.25 22.64 23.15 22.71 23.11 22.39 22.91<br />
Total 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0<br />
Comparis<strong>on</strong> <strong>of</strong> the 12 opti<strong>on</strong>s with the current <strong>RREF</strong> (with eligible Veterans included in the<br />
base populati<strong>on</strong>) and with each other points to the following c<strong>on</strong>clusi<strong>on</strong>s:<br />
• The differences between the regi<strong>on</strong>al shares <strong>of</strong> growth funds are small overall. Compared<br />
to the current <strong>RREF</strong>, differences overall are less for Base Populati<strong>on</strong> 2 than for Base<br />
Populati<strong>on</strong> 3.<br />
• There is a change in the shares <strong>of</strong> growth funds for rural and metropolitan regi<strong>on</strong>s for all the<br />
opti<strong>on</strong>s compared to the current <strong>RREF</strong>. In the current <strong>RREF</strong>, <strong>on</strong>ly the five rural regi<strong>on</strong>s<br />
received a need weighting for rurality, whereas in all <strong>of</strong> the opti<strong>on</strong>s for a revised <strong>RREF</strong>, all<br />
metropolitan regi<strong>on</strong>s also received a weighting based <strong>on</strong> the need variables. When all<br />
LGAs and hence all regi<strong>on</strong>s are weighted <strong>on</strong> the same need variables, it is evident that no<br />
<strong>on</strong>e model c<strong>on</strong>sistently generates maximum or minimum shares for any set <strong>of</strong> regi<strong>on</strong>s. No<br />
<strong>on</strong>e model results in c<strong>on</strong>sistent differences between metropolitan regi<strong>on</strong>s vis-a-vis n<strong>on</strong>metropolitan<br />
regi<strong>on</strong>s indicating that patterns <strong>of</strong> need are more complex than a simple ruralurban<br />
divide.<br />
• Differences in populati<strong>on</strong> size mean that even where rural LGAs receive the same or higher<br />
need weighting than metropolitan areas, regi<strong>on</strong>al shares <strong>of</strong> growth funds will c<strong>on</strong>tinue to be<br />
smaller than the metropolitan regi<strong>on</strong>s due to smaller underlying populati<strong>on</strong>s and trends in<br />
these populati<strong>on</strong>s over time. The net effect is that as metropolitan regi<strong>on</strong>s receive increased<br />
shares <strong>of</strong> funds, rural regi<strong>on</strong>s receive smaller shares, but the extent and directi<strong>on</strong> <strong>of</strong> change<br />
varies between the opti<strong>on</strong>s.<br />
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Part C: Outcomes<br />
• Compared to the model with six variables with no adjustment in the weighting <strong>of</strong> the need<br />
variables, the effect <strong>of</strong> using <strong>on</strong>ly four variables or <strong>of</strong> adjusting the weighting <strong>of</strong> selected<br />
variables was to reduce the overall variability across all regi<strong>on</strong>s rather than bringing about<br />
significant changes in regi<strong>on</strong>al shares <strong>of</strong> growth funds. This outcome is largely because<br />
reducing the number <strong>of</strong> variables or increasing the weighting <strong>of</strong> selected variables has the<br />
effect <strong>of</strong> suppressing the c<strong>on</strong>tributi<strong>on</strong> <strong>of</strong> the other variables. While the impact <strong>of</strong> the<br />
variables that are retained or given increased weighting becomes more dominant, the<br />
capacity <strong>of</strong> the model to capture variati<strong>on</strong>s in need due to other variables is limited.<br />
• Further models could be developed including or excluding other need variables and<br />
applying different weightings. While further models are likely to show other variati<strong>on</strong>s in<br />
regi<strong>on</strong>al shares in growth funds, and possibly in different directi<strong>on</strong>s, the effects are likely to<br />
be even smaller as other variables did not make as large c<strong>on</strong>tributi<strong>on</strong>s to the overall model<br />
as those selected in the examples presented here.<br />
• A selecti<strong>on</strong> <strong>of</strong> the initial models was developed to show outcomes in 2006 and reported in<br />
the Opti<strong>on</strong>s Paper. The outcomes show that the <strong>RREF</strong> has an in-built dynamic through<br />
annual adjustment in line with populati<strong>on</strong> projecti<strong>on</strong>s and changes in the comp<strong>on</strong>ents <strong>of</strong> the<br />
base populati<strong>on</strong>s, and changes in the resource allocati<strong>on</strong>s are driven accordingly. The<br />
results <strong>of</strong> the projecti<strong>on</strong>s for the initial model are not reported here but projected outcomes<br />
for the revised modelling are detailed in Table 7.3.<br />
7.3 OPTIONS FOR CONSIDERATION FOR RESOURCE ALLOCATIONS<br />
The opti<strong>on</strong>s presented in Step 7 in the Opti<strong>on</strong>s Paper illustrated the impact <strong>of</strong> modelling a range<br />
<strong>of</strong> variables and different weightings, as summarised below. Views <strong>on</strong> these outcomes were<br />
sought in the Round 2 C<strong>on</strong>sultati<strong>on</strong>s.<br />
Opti<strong>on</strong>s for different<br />
base populati<strong>on</strong>s,<br />
with even weighting<br />
<strong>of</strong> variables<br />
The effects <strong>of</strong> underlying demographic trends are evident<br />
in c<strong>on</strong>tinuati<strong>on</strong> <strong>of</strong> the current <strong>RREF</strong> and carry through all<br />
opti<strong>on</strong>s.<br />
The effects <strong>of</strong> <strong>RREF</strong> opti<strong>on</strong>s <strong>on</strong> the distributi<strong>on</strong> <strong>of</strong> growth<br />
funds between regi<strong>on</strong>s will also affect performance targets.<br />
Opti<strong>on</strong>s for 4 or 6<br />
variable model<br />
Opti<strong>on</strong>s for<br />
unadjusted or<br />
adjusted weighting <strong>of</strong><br />
variables<br />
Is a 4 variable model preferred?<br />
Or is a 6 variable model preferred as being more<br />
comprehensive?<br />
Should models be prepared with different weightings for<br />
other variables – if so,<br />
which variables, and<br />
how much should they be weighted?<br />
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Part C: Outcomes<br />
7.4 FURTHER ISSUES AND VIEWS ON OUTCOMES<br />
• The outcomes <strong>of</strong> the 12 models developed in the Opti<strong>on</strong>s Paper were summarised as<br />
presenting the following choices:<br />
Opti<strong>on</strong>s that result in smaller differences overall generate smaller shifts between<br />
regi<strong>on</strong>s.<br />
Opti<strong>on</strong>s that result in larger differences overall c<strong>on</strong>centrate larger shifts <strong>on</strong> a smaller<br />
number <strong>of</strong> regi<strong>on</strong>s balanced by c<strong>on</strong>sequent shifts from more regi<strong>on</strong>s.<br />
• The comparis<strong>on</strong> <strong>of</strong> the 12 opti<strong>on</strong>s highlighted that no <strong>on</strong>e opti<strong>on</strong> c<strong>on</strong>sistently resulted in<br />
maximum or minimum outcomes for all rural or all metropolitan regi<strong>on</strong>s. The current<br />
<strong>RREF</strong> resulted in a maximum share for three <strong>of</strong> the five rural regi<strong>on</strong>s and <strong>on</strong>e metropolitan<br />
regi<strong>on</strong>, and minimum shares for two metropolitan regi<strong>on</strong>s.<br />
• The differences between the 4 and 6 variable models, and between models in which the<br />
socio-ec<strong>on</strong>omic variable or the ARIA were doubled were minor. In particular, it should be<br />
noted that in the four models in which the ARIA was doubled, a maximum share resulted<br />
for <strong>on</strong>ly <strong>on</strong>e rural regi<strong>on</strong>.<br />
• Four c<strong>on</strong>sistent views emerged from the assessment <strong>of</strong> the 12 opti<strong>on</strong>s compared to the<br />
current <strong>RREF</strong> in the Round 2 C<strong>on</strong>sultati<strong>on</strong>s:<br />
1. Opti<strong>on</strong>s to revise the <strong>RREF</strong> pointed to the regi<strong>on</strong>s which were relatively under<br />
or over-funded in the current <strong>RREF</strong>. Participants from the Northern and<br />
Western Metropolitan Regi<strong>on</strong>s especially felt that projected outcomes from<br />
opti<strong>on</strong>s for revisi<strong>on</strong> justified their claims <strong>of</strong> under-funding under the current<br />
<strong>RREF</strong>.<br />
2. While participants obviously preferred the model that gave the maximum share<br />
<strong>of</strong> resources to their regi<strong>on</strong>, there was wide acknowledgement <strong>of</strong> the need for<br />
the <strong>RREF</strong> to improve equity between regi<strong>on</strong>s and to be seen to be equitable.<br />
Some participants in rural regi<strong>on</strong>s, but not all, supported c<strong>on</strong>tinuati<strong>on</strong> <strong>of</strong> the<br />
current <strong>RREF</strong> because it maximised their regi<strong>on</strong>’s share <strong>of</strong> resources, but the<br />
current <strong>RREF</strong> was at the same time seen to be less equitable as a formula.<br />
Complementing any revised <strong>RREF</strong> with other measures that addressed the cost<br />
<strong>of</strong> travel in rural areas was widely seen as the preferred soluti<strong>on</strong>.<br />
3. Given the small differences between the 12 models and the current <strong>RREF</strong>, and<br />
that underlying demographic trends would lead to changes in future regi<strong>on</strong>al<br />
shares <strong>of</strong> resources, participants recognised that the model which gave an<br />
optimum outcome for their regi<strong>on</strong> in 2002 might not produce the optimum<br />
outcome in subsequent years.<br />
4. An overall preference was for a model with fewer rather than more variables,<br />
and while there was support for adjusting the weighting <strong>of</strong> some individual<br />
variables, this view was qualified in the absence <strong>of</strong> any clear rati<strong>on</strong>ales for<br />
adjusting <strong>on</strong>e variable rather than another, or for the extent <strong>of</strong> adjustment that<br />
might be warranted. The differing c<strong>on</strong>tributi<strong>on</strong>s that the variables actually<br />
made to the model was also recognised as moderating the need for further<br />
adjustment.<br />
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Part C: Outcomes<br />
7.5 REVISED OUTCOMES FOR REGIONAL RESOURCE ALLOCATION<br />
The revised outcomes for regi<strong>on</strong>al resource allocati<strong>on</strong>s presented in Table 7.3 incorporate the<br />
resoluti<strong>on</strong> <strong>of</strong> opti<strong>on</strong>s reported for Steps 1 to 4, in favour <strong>of</strong>:<br />
1. C<strong>on</strong>tinued modelling <strong>of</strong> Base 2 and Base 3 populati<strong>on</strong>s;<br />
2. Inclusi<strong>on</strong> <strong>of</strong> five need variables, and<br />
3. Weighting without adjustment, in accord with the distributi<strong>on</strong> <strong>of</strong> scaled scores, and<br />
double weighting <strong>of</strong> the SES and ARIA variables to illustrate the impact <strong>of</strong> differential<br />
weighting <strong>of</strong> variables. Maximum and minimum shares for each regi<strong>on</strong> are highlighted.<br />
Table 7.3: Revised outcomes for resource allocati<strong>on</strong>, 2002 and 2006<br />
Regi<strong>on</strong>al % share <strong>of</strong> growth funds under model<br />
Year 2002 Base Unadjusted SES variable x 2 ARIA x 2<br />
<strong>RREF</strong> Weighting<br />
Regi<strong>on</strong><br />
Base 2 Base 3 Base 2 Base 3 Base 2 Base 3<br />
Barw<strong>on</strong> SW 7.73 8.10 7.92 8.26 8.08 8.17 7.99<br />
Grampians 5.17 4.78 4.73 4.88 4.82 4.88 4.82<br />
Lodd<strong>on</strong> Mallee 7.59 7.02 6.91 7.12 7.01 7.21 7.09<br />
Hume 6.26 5.64 5.59 5.73 5.69 5.78 5.73<br />
Gippsland 6.37 6.32 6.16 6.43 6.27 6.52 6.36<br />
Western 10.77 11.79 12.00 11.66 11.87 11.53 11.74<br />
Northern 14.16 15.51 15.58 15.32 15.39 15.22 15.29<br />
Eastern 19.35 17.75 18.07 17.49 17.80 17.83 18.15<br />
Southern 22.60 23.08 23.05 23.11 23.08 22.86 22.83<br />
Total 100.0 100.0 100.0 100.0 100.0 100.0 100.0<br />
Year 2006<br />
Barw<strong>on</strong> SW 7.67 8.00 7.86 8.16 8.02 8.06 7.93<br />
Grampians 4.95 4.75 4.68 4.84 4.77 4.85 4.77<br />
Lodd<strong>on</strong> Mallee 7.58 7.02 6.90 7.12 7.00 7.21 7.09<br />
Hume 6.30 5.70 5.62 5.79 5.72 5.84 5.76<br />
Gippsland 6.47 6.43 6.29 6.54 6.40 6.64 6.49<br />
Western 11.04 12.00 12.20 11.87 12.07 11.75 11.94<br />
Northern 14.11 15.57 15.60 15.38 15.41 15.28 15.32<br />
Eastern 19.15 17.54 17.79 17.29 17.53 17.62 17.88<br />
Southern 22.73 22.98 23.05 23.01 23.08 22.76 22.83<br />
Total 100.0 100.0 100.0 100.0 100.0 100.0 100.0<br />
Note: Current <strong>RREF</strong> includes eligible Veterans in the base populati<strong>on</strong>.<br />
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Four features <strong>of</strong> the revised outcomes overall warrant comment:<br />
Part C: Outcomes<br />
1. The differences in regi<strong>on</strong>al shares <strong>of</strong> growth funds between all models are small.<br />
For Base 2 and Base 3, the shift between regi<strong>on</strong>s is in the order <strong>of</strong> <strong>on</strong>ly 3.25% <strong>of</strong><br />
growth funds. Assuming growth at 6% per annum, estimated growth funds for<br />
2002 would be some $15.7 milli<strong>on</strong>, and the amount reallocated would be in the<br />
order <strong>of</strong> <strong>on</strong>ly $500,000.<br />
2. It is apparent that no <strong>on</strong>e model shows a c<strong>on</strong>sistent pattern <strong>of</strong> maximum or<br />
minimum shares <strong>of</strong> growth funds to a particular set <strong>of</strong> regi<strong>on</strong>s but rather that<br />
marginal shifts occur between both rural and metropolitan regi<strong>on</strong>s under different<br />
opti<strong>on</strong>s.<br />
3. The most marked reallocati<strong>on</strong>s occur under Base 3, without adjustment <strong>of</strong> need<br />
weighting, which generates maximum shares for two large metropolitan regi<strong>on</strong>s,<br />
and larger shares than under the current <strong>RREF</strong> for two other regi<strong>on</strong>s; at the same<br />
time, about half the reallocati<strong>on</strong> comes from the fourth metropolitan regi<strong>on</strong>, with<br />
the balance spread across the other four rural regi<strong>on</strong>s.<br />
4. The impact <strong>of</strong> the changes in the share <strong>of</strong> resources allocated to rural regi<strong>on</strong>s under<br />
any revised <strong>RREF</strong> was widely remarked in the Round 2 c<strong>on</strong>sultati<strong>on</strong>s. Recognising<br />
that performance targets were tied to the level <strong>of</strong> resources allocated through the<br />
<strong>RREF</strong>, and that this outcome would not address the additi<strong>on</strong>al costs incurred in<br />
service delivery in rural regi<strong>on</strong>s, complementary measures were seen to be required.<br />
The kinds <strong>of</strong> measures suggested are noted in Secti<strong>on</strong> 8.<br />
Three aspects <strong>of</strong> the differences between the models warrant comment:<br />
1. The current <strong>RREF</strong> does not result in maximum shares for all rural<br />
regi<strong>on</strong>s.<br />
2. Comparis<strong>on</strong> <strong>of</strong> Base 2 and Base 3 with unadjusted weightings shows<br />
Base 2 results in a flat outcome, with no maximum or minimum shares<br />
for any regi<strong>on</strong>, and a lower reallocati<strong>on</strong> overall than Base 3.<br />
3. The effect <strong>of</strong> doubling the weighting <strong>of</strong> the SES and ARIA variables is<br />
to reduce the variati<strong>on</strong> in the outcomes <strong>of</strong> these models rather than to<br />
generate more marked changes in regi<strong>on</strong>al shares.<br />
7.6 ASSESSMENT OF OPTIONS<br />
The outcomes <strong>of</strong> different opti<strong>on</strong>s in terms <strong>of</strong> the extent <strong>of</strong> overall change in allocati<strong>on</strong>s <strong>of</strong><br />
growth funds and in shares allocated to regi<strong>on</strong>s are <strong>of</strong> most immediate interest. The overall<br />
differences are however small, and these outcomes will change from year to year given the<br />
dynamic nature <strong>of</strong> the variables included in the <strong>RREF</strong> and underlying populati<strong>on</strong> trends.<br />
Assessment <strong>on</strong> the basis <strong>of</strong> a single year outcome, or even a five year projecti<strong>on</strong>, is thus a<br />
limited view <strong>of</strong> the effectiveness <strong>of</strong> the <strong>RREF</strong> in achieving equity in HACC or the extent to<br />
which the opti<strong>on</strong>s developed in the Review are improvements over the current <strong>RREF</strong>.<br />
A sec<strong>on</strong>d level <strong>of</strong> assessment can be made in terms <strong>of</strong> the relative c<strong>on</strong>tributi<strong>on</strong> <strong>of</strong> the three<br />
elements <strong>of</strong> the <strong>RREF</strong> model - the base populati<strong>on</strong>, the adjustment for the frail aged, and the<br />
weighting for need - to the overall outcomes compared to the current <strong>RREF</strong>. This comparis<strong>on</strong><br />
for the current <strong>RREF</strong> and the Base 2 and Base 3 opti<strong>on</strong>s is presented in Table 7.4.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 79
Part C: Outcomes<br />
The c<strong>on</strong>tributi<strong>on</strong>s that the three comp<strong>on</strong>ents make to the current <strong>RREF</strong> are as reported in Part A.<br />
Three steps were required to estimate the c<strong>on</strong>tributi<strong>on</strong>s that the three comp<strong>on</strong>ents make to the<br />
Base 2 and Base 3 opti<strong>on</strong>s:<br />
1. The base populati<strong>on</strong>s reported in Table 5.1 were divided into a “core”<br />
base populati<strong>on</strong> <strong>of</strong> those with core activity restricti<strong>on</strong>s <strong>of</strong> all ages (that<br />
is, Base 1 in Table 5.1), with the balance comprising the additi<strong>on</strong>al<br />
adjustment made for the frail aged.<br />
2. The total base populati<strong>on</strong>s were then weighted by the average need<br />
weighting score for all LGAs, 36.6%, to produce a total for the<br />
weighted <strong>RREF</strong> base populati<strong>on</strong>s. It is the regi<strong>on</strong>al shares <strong>of</strong> this<br />
weighted <strong>RREF</strong> populati<strong>on</strong> that are the basis <strong>of</strong> allocati<strong>on</strong>s under the<br />
<strong>RREF</strong>.<br />
3. The c<strong>on</strong>tributi<strong>on</strong> <strong>of</strong> each <strong>of</strong> the three comp<strong>on</strong>ents was then calculated<br />
as a percentage <strong>of</strong> the total <strong>RREF</strong> weighted populati<strong>on</strong>. Because the<br />
same average weighting has been applied to both base populati<strong>on</strong>s, the<br />
need weighting makes the same c<strong>on</strong>tributi<strong>on</strong> to Base 2 and Base 3.<br />
Note that the c<strong>on</strong>tributi<strong>on</strong> <strong>of</strong> the 36.6% weighting to the total weighted<br />
populati<strong>on</strong> becomes 26.8%. It should also be noted here that the<br />
average need weighting is without adjustment to the weighting for any<br />
<strong>of</strong> the variables, and that any such adjustments would <strong>on</strong>ly change the<br />
balance <strong>of</strong> the variables within the total weighting and not change the<br />
c<strong>on</strong>tributi<strong>on</strong> <strong>of</strong> the total need weighting to the overall model.<br />
Table 7.4: Share <strong>of</strong> <strong>RREF</strong> outcomes attributable to base populati<strong>on</strong> comp<strong>on</strong>ents<br />
and need weightings<br />
“Core” base Adjustment Weighting for Total<br />
populati<strong>on</strong><br />
(those with core<br />
activity<br />
restricti<strong>on</strong>,<br />
all ages)<br />
for<br />
frail aged<br />
need variables<br />
Current <strong>RREF</strong> 87.7 5.5 6.8 100<br />
Revised <strong>RREF</strong> -Base 2 39.6 33.6 26.8 100<br />
Revised <strong>RREF</strong> - Base 3 49.4 23.8 26.8 100<br />
In a revised <strong>RREF</strong> using either Base 2 or Base 3, both the frail aged and the need weighting<br />
make a much greater c<strong>on</strong>tributi<strong>on</strong> than in the current <strong>RREF</strong>. The c<strong>on</strong>tributi<strong>on</strong> <strong>of</strong> the need<br />
weighting increases from 6.8% in the current <strong>RREF</strong> to 26.8% both the revised <strong>RREF</strong> models.<br />
The weighting in the revised <strong>RREF</strong> models encompasses five broad dimensi<strong>on</strong>s <strong>of</strong> need<br />
compared to weighting <strong>on</strong>ly for rurality in the current <strong>RREF</strong>. This multi-dimensi<strong>on</strong>al need<br />
weighting addresses the criticism <strong>of</strong> the restricted nature <strong>of</strong> the need weighting in the current<br />
<strong>RREF</strong>.<br />
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Part C: Outcomes<br />
The adjustment for the frail aged increases from 5.5% to 33.6% <strong>of</strong> the revised <strong>RREF</strong> using Base<br />
2 and 23.8% using Base 3; it needs to be remembered this adjustment is in additi<strong>on</strong> to the frail<br />
aged populati<strong>on</strong> included in the “core” <strong>of</strong> the base populati<strong>on</strong>. The c<strong>on</strong>tributi<strong>on</strong> <strong>of</strong> the “core”<br />
base populati<strong>on</strong> is reduced from 87.7% in the current <strong>RREF</strong> to just <strong>on</strong> 40% and 50% in the<br />
revised <strong>RREF</strong> using Base and Base 3 respectively. The relative merits <strong>of</strong> the adjustments for<br />
the frail aged in Base 2 and Base 3 have been discussed in detail in Part B, Step 1, but when<br />
these additi<strong>on</strong>al adjustments are taken together with the frail aged in the “core” base populati<strong>on</strong>,<br />
both make for an overall outcome that gives a much closer match to the importance <strong>of</strong> the frail<br />
aged in the HACC client populati<strong>on</strong> and so address this shortcoming in the current <strong>RREF</strong>.<br />
The increased c<strong>on</strong>tributi<strong>on</strong>s <strong>of</strong> the adjustments for the frail aged populati<strong>on</strong> and weighting for<br />
need variables in the revised <strong>RREF</strong> models indicate that the two major shortcomings identified<br />
in the current <strong>RREF</strong> have been addressed in the revised <strong>RREF</strong>. The revised <strong>RREF</strong> models<br />
thus provide the basis for more equitable outcomes in resource allocati<strong>on</strong> than c<strong>on</strong>tinuati<strong>on</strong> <strong>of</strong><br />
the current <strong>RREF</strong>.<br />
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PART D: ACHIEVING EQUITY IN THE HACC<br />
PROGRAM<br />
The <strong>RREF</strong> makes a major c<strong>on</strong>tributi<strong>on</strong> to achieving equity in HACC as the mechanism through<br />
which growth funds are allocated to regi<strong>on</strong>s, but a number <strong>of</strong> other factors also affect equity <strong>of</strong><br />
outcomes in service delivery. The Terms <strong>of</strong> Reference <strong>of</strong> the Review pointed to these factors,<br />
and they were raised in the c<strong>on</strong>sultati<strong>on</strong>s and in research c<strong>on</strong>ducted in the course <strong>of</strong> the Review.<br />
This part <strong>of</strong> the <str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> summarises four issues and identifies opti<strong>on</strong>s through which they<br />
could be addressed in c<strong>on</strong>juncti<strong>on</strong> with the implementati<strong>on</strong> <strong>of</strong> any revised <strong>RREF</strong>.<br />
Regi<strong>on</strong>al and local planning for HACC<br />
While the <strong>RREF</strong> is c<strong>on</strong>structed with data at the LGA level, it is applied by DHS <strong>on</strong>ly at regi<strong>on</strong>al<br />
level for state-wide resource allocati<strong>on</strong>. Some DHS Regi<strong>on</strong>al Offices however apply the <strong>RREF</strong><br />
at a sub-regi<strong>on</strong>al or local level to develop noti<strong>on</strong>al resource allocati<strong>on</strong>s but the <strong>RREF</strong> is not<br />
formally applied in this way.<br />
The variability in regi<strong>on</strong>al and local planning processes was a subject <strong>of</strong> major discussi<strong>on</strong> in the<br />
c<strong>on</strong>sultati<strong>on</strong>s, and a clearer relati<strong>on</strong>ship between the allocati<strong>on</strong> <strong>of</strong> resources to regi<strong>on</strong>s through<br />
the <strong>RREF</strong> and the processes by which resources were subsequently allocated within regi<strong>on</strong>s was<br />
seen to be desirable. It is not intended that any revised <strong>RREF</strong> be applied at the local level, but<br />
access to the basic statistical data compiled in the Review was widely sought and a standard<br />
data base that was regularly updated would make a major c<strong>on</strong>tributi<strong>on</strong> to more systematic<br />
planning in all regi<strong>on</strong>s. This data then needs to be c<strong>on</strong>sidered in c<strong>on</strong>juncti<strong>on</strong> with a range <strong>of</strong><br />
quantitative and qualitative informati<strong>on</strong> <strong>on</strong> local service provisi<strong>on</strong>, including reports using the<br />
HACC Minimum Data Set. As HACC services operate as part <strong>of</strong> local service systems, local<br />
knowledge is also required and Primary Care Partnerships now provide forums for the exchange<br />
<strong>of</strong> such informati<strong>on</strong>. By way <strong>of</strong> example, uneven access to regi<strong>on</strong>-wide services is a problem<br />
that has to be addressed at the regi<strong>on</strong>al and sub-regi<strong>on</strong>al level, with resoluti<strong>on</strong> depending <strong>on</strong> the<br />
particular c<strong>on</strong>figurati<strong>on</strong>s <strong>of</strong> local services and networks between providers.<br />
The Memorandum <strong>of</strong> Understanding between the Municipal Associati<strong>on</strong> <strong>of</strong> Victoria and DHS<br />
<strong>on</strong> local community services planning is another vehicle for advancing integrated regi<strong>on</strong>al and<br />
local planning. The level <strong>of</strong> participati<strong>on</strong> <strong>of</strong> Local Government in the Review C<strong>on</strong>sultati<strong>on</strong>s<br />
indicates the commitment to this goal <strong>on</strong> the part <strong>of</strong> Local Government as a major HACC<br />
provider<br />
While planning in c<strong>on</strong>juncti<strong>on</strong> with annual HACC funding rounds is focused <strong>on</strong> growth funds, it<br />
needs to be emphasised that the amount <strong>of</strong> these new funds is small compared to pre-existing<br />
levels <strong>of</strong> funding, and reviews <strong>of</strong> existing service arrangements are at least as important in<br />
regi<strong>on</strong>al and local planning as the development <strong>of</strong> new services at the margin.<br />
Four further issues relating to HACC planning processes that were canvassed in the Review and<br />
that need to be taken into account in implementing any revised <strong>RREF</strong> are:<br />
1. Having a statewide noti<strong>on</strong>al service mix for HACC was seen to be<br />
useful in providing a benchmark to which regi<strong>on</strong>al variati<strong>on</strong>s could be<br />
compared. Any noti<strong>on</strong>al service mix was not seen as a prescripti<strong>on</strong>, but<br />
would rather provide a basis for assessing the reas<strong>on</strong>s for variati<strong>on</strong>s that<br />
did arise. Some specificati<strong>on</strong> <strong>of</strong> benchmarks for service provisi<strong>on</strong><br />
would also c<strong>on</strong>tribute to assessing the adequacy <strong>of</strong> service provisi<strong>on</strong>.<br />
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Part D: Achieving Equity in the HACC Program<br />
2. The linking <strong>of</strong> HACC planning and resource allocati<strong>on</strong> through the<br />
<strong>RREF</strong> to planning and resource allocati<strong>on</strong> <strong>of</strong> related programs at subregi<strong>on</strong>al<br />
and local level was identified as a high priority. The analysis<br />
<strong>of</strong> resource allocati<strong>on</strong> formulas used in the Disability Services Program<br />
and in the Post Acute Care Program identified a number <strong>of</strong> comm<strong>on</strong><br />
elements with the <strong>RREF</strong>, at the same time as acknowledging that<br />
different elements were needs where target groups were different.<br />
Programs without formal formulas were <strong>of</strong> more c<strong>on</strong>cern, as there was<br />
a risk that resource allocati<strong>on</strong> in these programs could distort needs<br />
based allocati<strong>on</strong> through the <strong>RREF</strong>. C<strong>on</strong>siderati<strong>on</strong> <strong>of</strong> the applicability<br />
<strong>of</strong> the <strong>RREF</strong> or a similar formula to these program areas would go<br />
some way to achieving more c<strong>on</strong>sistency.<br />
3. The methods used by other State Governments to distribute HACC<br />
funds within each state were found to be less well developed then the<br />
current <strong>RREF</strong>, and rather than pointing to ways ahead for Victoria, the<br />
Review was likely to provide a lead to other States. DHS has the<br />
opportunity to take up several developments from the Review with the<br />
Comm<strong>on</strong>wealth in debate around the nati<strong>on</strong>al equalisati<strong>on</strong> strategy for<br />
HACC funding. Two areas <strong>of</strong> particular relevance to the nati<strong>on</strong>al scene<br />
are the opti<strong>on</strong>s developed for operati<strong>on</strong>alising the definiti<strong>on</strong> <strong>of</strong> the<br />
HACC target populati<strong>on</strong> and the need for c<strong>on</strong>tinuing liais<strong>on</strong> with the<br />
ABS in planning <strong>of</strong> the next DACS.<br />
4. C<strong>on</strong>sultati<strong>on</strong>s <strong>on</strong> targeting in HACC were held in c<strong>on</strong>juncti<strong>on</strong> with the<br />
first round <strong>of</strong> c<strong>on</strong>sultati<strong>on</strong>s in the Review. Targeting is c<strong>on</strong>cerned with<br />
the allocati<strong>on</strong> <strong>of</strong> resources between clients <strong>on</strong> the basis <strong>of</strong> relative need<br />
and so complements the operati<strong>on</strong> <strong>of</strong> the <strong>RREF</strong> at regi<strong>on</strong>al level.<br />
There was support for further development <strong>of</strong> the c<strong>on</strong>cept <strong>of</strong> a special<br />
mechanism for funding clients needing excepti<strong>on</strong>ally high levels <strong>of</strong><br />
support and funding, al<strong>on</strong>g the lines <strong>of</strong> the High Care Pool that has<br />
been operated by the NSW Home Care Services since late 1998. A<br />
report <strong>of</strong> the High Care Pool presented in early <strong>2001</strong> showed that it had<br />
met the objectives set in relati<strong>on</strong> to service mix targets, client<br />
satisfacti<strong>on</strong>, enabling HACC to maintain service levels <strong>of</strong> lower needs<br />
clients and providing portability <strong>of</strong> service if clients relocated within<br />
the state (Hetheringt<strong>on</strong>, <strong>2001</strong>). These positive outcomes indicate that<br />
the High Care Pool made an effective c<strong>on</strong>tributi<strong>on</strong> to achieving equity<br />
in HACC, and further the need to c<strong>on</strong>sider the opti<strong>on</strong> in Victoria.<br />
Funding measures complementary to the <strong>RREF</strong><br />
Throughout the c<strong>on</strong>sultati<strong>on</strong>s and the subsequent modelling <strong>of</strong> opti<strong>on</strong>s, it became clear that<br />
while the current <strong>RREF</strong> and any revised <strong>RREF</strong> operates effectively as a tool for statewide<br />
allocati<strong>on</strong> <strong>on</strong> the basis <strong>of</strong> a c<strong>on</strong>sistent definiti<strong>on</strong> <strong>of</strong> need, it cannot address other factors that<br />
have an impact <strong>on</strong> the cost <strong>of</strong> service delivery and hence <strong>on</strong> resource requirements, nor can it<br />
address special cases that may arise in some areas but do not have statewide implicati<strong>on</strong>s. Four<br />
aspects <strong>of</strong> HACC funding arrangements outside the <strong>RREF</strong> were raised.<br />
Part D: Achieving Equity in the HACC Program<br />
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Additi<strong>on</strong>al costs <strong>of</strong> service delivery in rural areas<br />
While the rurality weighting in the current <strong>RREF</strong> was intended to address costs associated with<br />
delivery <strong>of</strong> services to clients living in rural and remote areas, it has proved to be a “catch 22”.<br />
Participants in the c<strong>on</strong>sultati<strong>on</strong>s pointed out that additi<strong>on</strong>al funding through the <strong>RREF</strong> led to<br />
increased performance targets at the same unit price, and so was an ineffective means <strong>of</strong><br />
recognising higher costs per unit <strong>of</strong> service delivered. There was also some debate as to the<br />
overall balance <strong>of</strong> different cost factors in rural and metropolitan regi<strong>on</strong>s. Given that an<br />
analysis <strong>of</strong> cost differences carried out by DHS in preparati<strong>on</strong> for the introducti<strong>on</strong> <strong>of</strong> unit<br />
costing in 1998 produced ambivalent results about cost differentials between rural and<br />
metropolitan areas, there was seen to be a need to update that work.<br />
A revised <strong>RREF</strong> would take account <strong>of</strong> need factors in additi<strong>on</strong> to rurality that affect the volume<br />
<strong>of</strong> service need, but would not address other factors that affect the cost <strong>of</strong> service delivery in<br />
rural areas. Factors relating to scale <strong>of</strong> service operati<strong>on</strong> may be more appropriately addressed<br />
by service development strategies that bring providers together, for example, to share<br />
informati<strong>on</strong> technology and staff training, than through the <strong>RREF</strong>. In any measures to address<br />
travel costs, it was c<strong>on</strong>sidered important to separate clients who lived in major rural centres and<br />
larger towns from “distant” clients so that any supplementary measures could be targeted to<br />
meeting the extra costs <strong>of</strong> service delivery to the latter group.<br />
A related issue c<strong>on</strong>cerned the need to ensure access to regi<strong>on</strong>-wide services, but which could not<br />
deliver at the same level to all local areas. This uneven access is partly a matter <strong>of</strong> funding<br />
matter but also relates to service development and planning.<br />
Service development grants for special needs groups<br />
Koori services<br />
Provisi<strong>on</strong> <strong>of</strong> services to Koori clients can mean increased costs where relatively<br />
small scale Koori specific agencies have catchment areas that extend across<br />
several LGAs, and even across regi<strong>on</strong>al boundaries, whether in rural or<br />
metropolitan areas. This scale factor is similar to the issues affecting service<br />
availability for remote clients, and can result in workers from small agencies<br />
seeing <strong>on</strong>ly a few clients per day. Other issues affecting delivery <strong>of</strong> services to<br />
Koori clients, whether by Koori specific agencies or other agencies, such as<br />
awareness <strong>of</strong> family roles in Koori culture and recruitment and training <strong>of</strong><br />
Koori staff, could be further addressed through c<strong>on</strong>tinuing the kinds <strong>of</strong> service<br />
development initiatives that have already been undertaken.<br />
Services for culturally diverse client groups<br />
Delivery <strong>of</strong> services to culturally diverse client groups was also seen to carry<br />
additi<strong>on</strong>al costs, such as provisi<strong>on</strong> <strong>of</strong> interpreter services, for general HACC<br />
agencies that serve large numbers <strong>of</strong> clients from particular n<strong>on</strong>-English<br />
speaking backgrounds. Service development grants are again a means <strong>of</strong><br />
promoting strategies that can enhance the capacity <strong>of</strong> general agencies to meet<br />
the needs <strong>of</strong> these clients. Such strategies include closer liais<strong>on</strong> with ethnospecific<br />
providers to foster provisi<strong>on</strong> <strong>of</strong> more culturally appropriate services<br />
wherever possible, recruitment <strong>of</strong> staff from relevant cultural backgrounds and<br />
for training <strong>of</strong> all staff. However, where numbers <strong>of</strong> particular groups are small<br />
and/or no workers <strong>of</strong> the same cultural background as the client are available,<br />
the requirement for access to interpreter services needs to be recognised.<br />
Part D: Achieving Equity in the HACC Program<br />
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Unit cost structure<br />
The unit cost structure for HACC services was seen as providing insufficient funding for<br />
providers to maintain levels and standards <strong>of</strong> service provisi<strong>on</strong> in the face <strong>of</strong> rising costs and<br />
c<strong>on</strong>tinually growing demand. Inc<strong>on</strong>sistencies between HACC unit prices and pricing under<br />
other related programs were also noted.<br />
It was understood that the absolute level <strong>of</strong> funding for HACC and issues <strong>of</strong> unit pricing were<br />
bey<strong>on</strong>d the scope <strong>of</strong> the Review but were being addressed within the overall funding strategy <strong>of</strong><br />
the Aged, Community and Mental <strong>Health</strong> Divisi<strong>on</strong> <strong>of</strong> DHS.<br />
C<strong>on</strong>sistency in fees policy<br />
While the issue <strong>of</strong> capacity to raise fees has been substantially addressed by inclusi<strong>on</strong> <strong>of</strong> a<br />
socio-ec<strong>on</strong>omic indicator in the revised <strong>RREF</strong>, the questi<strong>on</strong> <strong>of</strong> c<strong>on</strong>sistency in fees policies<br />
remains. Although a standard fees policy has been applied in the administrati<strong>on</strong> <strong>of</strong> HACC in<br />
Victoria since 1998, it was c<strong>on</strong>sidered that there was c<strong>on</strong>siderable variati<strong>on</strong> in practices <strong>of</strong><br />
individual providers and that this variati<strong>on</strong> affected both equity <strong>of</strong> access for users and revenue<br />
raised by providers.<br />
Relati<strong>on</strong>shiop <strong>of</strong> Growth Funds to HACC Base funds<br />
While the Review focused <strong>on</strong> the <strong>RREF</strong> as a mechanism for allocating HACC growth funds<br />
between regi<strong>on</strong>s, the <strong>RREF</strong> brings about changes in the shares <strong>of</strong> HACC base funds that regi<strong>on</strong>s<br />
receive through two means:<br />
1. Each year’s growth funds are incorporated into the recurrent base funding that agencies<br />
in each regi<strong>on</strong> receive in the next year; and<br />
2. By defining the level <strong>of</strong> per capita funding that represents equity across regi<strong>on</strong>s, the<br />
<strong>RREF</strong> identifies the extent to which each regi<strong>on</strong>’s base funding varies for equity and the<br />
extent <strong>of</strong> possible adjustment needed to bring all regi<strong>on</strong>s to within 5% <strong>of</strong> equity..<br />
The need for adjustment to bring base funding into line with equity as defined by the <strong>RREF</strong> is<br />
recognised in the provisi<strong>on</strong> made in the current <strong>RREF</strong> for reserving a proporti<strong>on</strong> <strong>of</strong> growth<br />
funds for reallocati<strong>on</strong> to regi<strong>on</strong>s that all more than 5% below the level <strong>of</strong> equitable funding they<br />
should receive. In effect, growth funds are divided into a “normal growth” comp<strong>on</strong>ent and an<br />
“equity adjustment” comp<strong>on</strong>ent. These two comp<strong>on</strong>ents were identified in the C<strong>on</strong>sultati<strong>on</strong><br />
Paper (p. 8):<br />
1. The <strong>RREF</strong> is used to measure the share <strong>of</strong> resources currently allocated to the nine DHS<br />
regi<strong>on</strong>s against an “equity” distributi<strong>on</strong> in which any regi<strong>on</strong> would receive the same<br />
number <strong>of</strong> dollars per pers<strong>on</strong> in the Target Populati<strong>on</strong>. Where any regi<strong>on</strong> is more than<br />
5% below “equity” some <strong>of</strong> the annual growth funds are set aside for a special<br />
allocati<strong>on</strong> to these under funded regi<strong>on</strong>s to bring them closer to the statewide level <strong>of</strong><br />
equity funding (ie. the equity adjustment comp<strong>on</strong>ent as above).<br />
2. The remaining growth funds (ie the normal growth comp<strong>on</strong>ent as above) are then<br />
allocated to all regi<strong>on</strong>s in accord with each regi<strong>on</strong>’s proporti<strong>on</strong> <strong>of</strong> the State’s total<br />
Target Populati<strong>on</strong>. The size <strong>of</strong> each regi<strong>on</strong>al HACC Target Populati<strong>on</strong> is built up from<br />
estimates <strong>of</strong> the HACC Target populati<strong>on</strong> in each LGA.<br />
Part D: Achieving Equity in the HACC Program<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 85
Opti<strong>on</strong>s for revising the <strong>RREF</strong> do not result in dramatic shifts in resources between regi<strong>on</strong>s<br />
because the differences are relatively minor. There are greater differences between Local<br />
Government Areas in regi<strong>on</strong>s than between regi<strong>on</strong>s. Participants in both rounds <strong>of</strong><br />
C<strong>on</strong>sultati<strong>on</strong>s pointed out that such gradual changes would achieve <strong>on</strong>ly limited progress<br />
towards overall regi<strong>on</strong>al equity and that underlying inequities in base funding would persist<br />
unless further acti<strong>on</strong> was taken.<br />
As adopti<strong>on</strong> <strong>of</strong> any revised <strong>RREF</strong> would redraw the equity line, it was argued that the equity<br />
comp<strong>on</strong>ent needs to be adjusted accordingly. Once a decisi<strong>on</strong> is made <strong>on</strong> a revised <strong>RREF</strong>, it<br />
will be possible to identify the scale <strong>of</strong> the equity comp<strong>on</strong>ent required and the time frame over<br />
which equity in regi<strong>on</strong>al shares <strong>of</strong> HACC funding could be realised, taking account <strong>of</strong> available<br />
resources. It should be stressed that, as with past equity adjustments, funds for this purpose<br />
would be set aside before the amount <strong>of</strong> growth funds to be allocated through the <strong>RREF</strong> was<br />
determined and would not affect the absolute amount <strong>of</strong> base funding that regi<strong>on</strong>s c<strong>on</strong>tinued to<br />
receive or the shares <strong>of</strong> growth funds allocated through the <strong>RREF</strong>.<br />
In c<strong>on</strong>sidering the relati<strong>on</strong>ship between annual HACC growth funds and existing base funds<br />
received by regi<strong>on</strong>s, it needs to be emphasised that there is <strong>on</strong>ly a limited nexus between the<br />
share <strong>of</strong> base funds and the share <strong>of</strong> growth funds that any regi<strong>on</strong> receives. The share <strong>of</strong> growth<br />
funds is projected forward for the coming year by the <strong>RREF</strong>, independently <strong>of</strong> the pre-existing<br />
share <strong>of</strong> base funding that any regi<strong>on</strong> receives which reflects historical trends and the<br />
incorporati<strong>on</strong> <strong>of</strong> growth funds over many years. Rather than growth funds following the<br />
existing shares <strong>of</strong> base funding, it is the <strong>RREF</strong> that leads the determinati<strong>on</strong> <strong>of</strong> equitable shares<br />
<strong>of</strong> growth funding and base funding.<br />
There was support for acti<strong>on</strong> to address inequities in HACC base funding as part <strong>of</strong> the<br />
implementati<strong>on</strong> strategy for any revised <strong>RREF</strong>. C<strong>on</strong>tinuing to identify an annual equity<br />
adjustment would provide the means <strong>of</strong> bringing base funding into line with equity as defined<br />
by the a revised <strong>RREF</strong>. The scale <strong>of</strong> adjustment required would be indicated by the different<br />
between the shares <strong>of</strong> base funding and the equitable shares defined by the revised <strong>RREF</strong>, as for<br />
growth funds.<br />
Future review and <strong>on</strong>-going development <strong>of</strong> the <strong>RREF</strong><br />
Opti<strong>on</strong>s for future review and <strong>on</strong>-going development <strong>of</strong> the <strong>RREF</strong> were identified at two levels.<br />
First, new data for updating the data used in the <strong>RREF</strong> will become available from three sources<br />
in the next two years:<br />
1. The next nati<strong>on</strong>al census is to be held in August <strong>2001</strong>. As well as<br />
providing new data for updating <strong>of</strong> the base populati<strong>on</strong>s for the <strong>RREF</strong><br />
with new DOI projecti<strong>on</strong>s developed after the census, the census will<br />
enable updating and refinement <strong>of</strong> the four need variables that use<br />
census data, namely median household income, cultural diversity, the<br />
Koori populati<strong>on</strong> and the ARIA. Updating will take account <strong>of</strong> the<br />
combined effect <strong>of</strong> different rates <strong>of</strong> populati<strong>on</strong> growth between LGAs,<br />
associated changes in age structures, and changing characteristics <strong>of</strong><br />
local populati<strong>on</strong>s.<br />
2. Implementati<strong>on</strong> <strong>of</strong> the HACC Minimum Data Set will generate a<br />
c<strong>on</strong>siderable amount <strong>of</strong> relevant data at LGA level over the next 12<br />
m<strong>on</strong>ths. These data will be especially useful for comparing estimates<br />
<strong>of</strong> the size and characteristics <strong>of</strong> local HACC target populati<strong>on</strong>s based<br />
<strong>on</strong> the DAC Survey with clients using services.<br />
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Part D: Achieving Equity in the HACC Program<br />
3. The next DAC Survey is planned for 2003 and together with <strong>on</strong>going<br />
work in DHS <strong>on</strong> the burden <strong>of</strong> disease, alternative measures should<br />
then become available for defining the populati<strong>on</strong> in need <strong>of</strong> HACC<br />
services <strong>on</strong> the basis <strong>of</strong> disability, limitati<strong>on</strong>s in social participati<strong>on</strong> and<br />
need for assistance in activities <strong>of</strong> daily living.<br />
Apart from these specific opportunities for updating the data which is used in c<strong>on</strong>structing the<br />
<strong>RREF</strong>, there is a need for <strong>on</strong>-going m<strong>on</strong>itoring <strong>of</strong> the outcomes <strong>of</strong> any revised <strong>RREF</strong> that is<br />
implemented. It will be some time before such outcomes are apparent, and while a nine year<br />
interval without review as has occurred for the current <strong>RREF</strong> is too l<strong>on</strong>g, too frequent review<br />
can lead to instability. Updating <strong>of</strong> the need variables in the revised <strong>RREF</strong> when data become<br />
available from the <strong>2001</strong> Census is a relatively straightforward procedure and it is proposed that<br />
a full review <strong>of</strong> the structure <strong>of</strong> the revised <strong>RREF</strong> be made at the time that data from the next<br />
DACS survey becomes available, probably around late 2003 or early 2004. C<strong>on</strong>siderati<strong>on</strong> <strong>of</strong><br />
new DACS data in c<strong>on</strong>juncti<strong>on</strong> with data from the HACC Minimum Data Set could lead to<br />
more significant changes in c<strong>on</strong>structi<strong>on</strong> <strong>of</strong> the <strong>RREF</strong> rather than just updating <strong>of</strong> data.<br />
In the meantime, DHS should c<strong>on</strong>tinue to liaise with the ABS through the User Group for the<br />
DACS to ensure maximum usefulness <strong>of</strong> the survey results for administrati<strong>on</strong> <strong>of</strong> HACC and<br />
other departmental programs. There is also a need for research that combines “top down”<br />
estimates derived from the DACS survey with “bottom-up” local area surveys using the current<br />
DACS schedule, and drawing <strong>on</strong> HACC MDS data from local providers. This work would<br />
inform the development <strong>of</strong> community care client classificati<strong>on</strong>s.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 87
APPENDIX 1: Inputs to the Review Process<br />
APPENDIX 1.1: THE REVIEW REFERENCE GROUP<br />
Chair<br />
C<strong>on</strong>sumer Organisati<strong>on</strong>s<br />
ACROD Ltd Victorian Divisi<strong>on</strong><br />
Acti<strong>on</strong> <strong>on</strong> Disability within Ethnic<br />
Communities<br />
Alzheimer’s Associati<strong>on</strong> <strong>of</strong> Victoria<br />
Ms Patricia Reeve,<br />
Council <strong>on</strong> the Ageing, Victoria<br />
Ms Sue Kirkegarde, Executive Officer<br />
Ms Licia Kokocinski<br />
Ms Phillipa Angley, Policy Officer<br />
Associati<strong>on</strong> for Children with a Disability Inc Michael Gourlay, Chief Executive Officer<br />
Carers Victoria Inc<br />
Council <strong>of</strong> Intellectual Disability Agencies<br />
Council <strong>on</strong> the Ageing (Vic) Inc<br />
Ethnic Communities Council <strong>of</strong> Victoria<br />
Older Pers<strong>on</strong>s Acti<strong>on</strong> Centre (OPAC)<br />
Victorian Aboriginal Community C<strong>on</strong>trolled<br />
Housing Organisati<strong>on</strong><br />
Uni<strong>on</strong> and Pr<strong>of</strong>essi<strong>on</strong>al Organisati<strong>on</strong>s<br />
Australian Nursing Federati<strong>on</strong> (Vic. Branch)<br />
Australian Services Uni<strong>on</strong> –<br />
MEU/Private Sector Victoria Branch<br />
General Practice Divisi<strong>on</strong> Victoria<br />
<strong>Health</strong> Services Uni<strong>on</strong> Australia No. 1 Branch<br />
Australian Council <strong>of</strong> Community Nurses<br />
Local Government<br />
Municipal Associati<strong>on</strong> <strong>of</strong> Victoria<br />
Local Government Pr<strong>of</strong>essi<strong>on</strong>als Group<br />
Ms Maria Bohan, Executive Officer<br />
Mr Robert Pascoe<br />
Mr John Wise, Treasurer<br />
Mr Hakan Akyol/Ms Miriam Suss, Executive<br />
Officer<br />
Ms Susan Healey, Chairpers<strong>on</strong><br />
Mrs Bess Yarram, Chairpers<strong>on</strong><br />
Ms Jill Clutterbuck, Pr<strong>of</strong>essi<strong>on</strong>al Officer<br />
Ms Joan Price, Organiser<br />
Ms Lenora Lippman<br />
David Haynes, Industrial Officer<br />
Ms Marie-Louise Tucker, C<strong>on</strong>venor<br />
Clare Hargreaves,<br />
Senior Policy Advisor – Social Policy<br />
Ms Jan C<strong>on</strong>sedine, City <strong>of</strong> Greater Sheppart<strong>on</strong><br />
Ms Derryn Wills<strong>on</strong>, City <strong>of</strong> Moreland<br />
Ms Darnelle Eckersall, Banyule City Council<br />
Mr Paul O’Brien/Ms Anne Waters, City <strong>of</strong><br />
Warrnambool<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 88
APPENDIX 1.1 c<strong>on</strong>tinued<br />
Comm<strong>on</strong>wealth Government<br />
<strong>Department</strong> <strong>of</strong> <strong>Health</strong> and Aged Care<br />
<strong>Department</strong> <strong>of</strong> Veterans’ Affairs<br />
Provider Representative Bodies<br />
La Trobe Community <strong>Health</strong> Service<br />
Royal District Nursing Service<br />
Victorian Assoc. <strong>of</strong> <strong>Health</strong> & Extended<br />
Care<br />
Victorian Community <strong>Health</strong> Associati<strong>on</strong><br />
VHA<br />
Ms Margaret O’Loughlin, Assistant Director,<br />
Planning & Community Programs<br />
Ms Wendy Allan<br />
Asst. Director, Veterans’ Home Care Team<br />
Val Callister, Chief Executive Officer<br />
Ms Fi<strong>on</strong>a Hearn<br />
Ms Mary Barry, Chief Executive Officer/<br />
Ms Shar<strong>on</strong> D’Rosario<br />
Ms Linda West, President<br />
Ms Anne Fox, Bundoora Extended Care/<br />
Ms Fi<strong>on</strong>a McKinn<strong>on</strong>, Western <strong>Health</strong><br />
APPENDIX 1.2: DEPARTMENTAL STEERING COMMITTEE<br />
Aged, Community and Mental <strong>Health</strong><br />
Divisi<strong>on</strong><br />
Angela Jurjevic , Director<br />
Coordinated and Home Care Branch<br />
Jeannine Jacobs<strong>on</strong><br />
Alexandra Hurley<br />
Jane Heringt<strong>on</strong><br />
Kriss McKie<br />
Jeremy Maddox<br />
Justin McDermott<br />
Lisa Lane<br />
Carol Pyke<br />
Viki Perre<br />
Other Branches and Divisi<strong>on</strong>s<br />
Michael Ackland<br />
Jane Bennett<br />
Jacinta Bleeser<br />
Felicity Is<strong>on</strong><br />
Holly Pi<strong>on</strong>tek-Walker<br />
Sim<strong>on</strong> Moy<br />
Julie Walsh<br />
Brenda Whitmore-Seidel<br />
Noble Tabe<br />
Regi<strong>on</strong>al Offices<br />
Richard Deyell, Northern Metro<br />
Phil McCann, Lodd<strong>on</strong> Mallee<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 89
APPENDIX 1.3: CONSULTATION SCHEDULES<br />
Round 1: November-December 2000<br />
Date Metro/Rural DHS Regi<strong>on</strong> Locati<strong>on</strong><br />
23 November Metro Northern Coburg<br />
27 November Rural Barw<strong>on</strong> South Western Warnambool<br />
28 November Rural Grampians Ararat<br />
30 November Metro Southern Frankst<strong>on</strong><br />
1 st December Metro Western Footscray<br />
4 December Rural Gippsland Traralg<strong>on</strong><br />
5 December Rural Hume Benalla<br />
6 December Rural Lodd<strong>on</strong> Mallee Bendigo<br />
7 December Metro Eastern Nunawading<br />
20 December Rural Lodd<strong>on</strong> Mallee Mildura<br />
Rural Barw<strong>on</strong>-South West Geel<strong>on</strong>g<br />
Koori Groups<br />
Round 2: March –April <strong>2001</strong><br />
Date Metro/Rural DHS Regi<strong>on</strong> Locati<strong>on</strong><br />
26 March Rural Hume Benalla<br />
27 March Rural Gipplsand Traralg<strong>on</strong><br />
29 March Rural Barw<strong>on</strong>-South West Warrnambool<br />
30 March Metro Eastern Nunawading<br />
3 April Metro Western Footscray<br />
4 April Metro Southern Frankst<strong>on</strong><br />
4 April Rural Lodd<strong>on</strong> Mallee Mildura<br />
9 April Rural Lodd<strong>on</strong> Mallee Bendigo<br />
10 April Metro Northern Coburg<br />
11 April Rural Grampians Ararat<br />
Rural Barw<strong>on</strong>-South West Geel<strong>on</strong>g<br />
Koori Groups<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 90
APPENDIX 1.4: SUBMISSIONS RECEIVED<br />
Local Government<br />
Statewide 1. Municipal Associati<strong>on</strong> <strong>of</strong> Victoria<br />
Metropolitan 2. Darebin City Council and Darebin Community <strong>Health</strong> Centre<br />
3. Kingst<strong>on</strong> City Council<br />
4. Maribyn<strong>on</strong>g Council and Western Regi<strong>on</strong> <strong>Health</strong> Centre<br />
5. Moreland<br />
6. Nillumbik<br />
7. Port Phillip Council<br />
8. Western Regi<strong>on</strong> Commissi<strong>on</strong> (Cities <strong>of</strong> Brimbank, Hobs<strong>on</strong>’s<br />
Bay, Maribyrn<strong>on</strong>g, Melbourne, Mo<strong>on</strong>ey Valley, ISIS, and<br />
Shire <strong>of</strong> Melt<strong>on</strong>)<br />
9. Whittlesea<br />
10. Wyndham City Council<br />
11. Yarra Ranges Shire Council<br />
Regi<strong>on</strong>al 12. Corangamite Shire Council<br />
13. Horsham Rural City Council<br />
14. Hindmarsh Shire Council<br />
15. Southern Grampians Shire Council<br />
16. Wangaratta Council<br />
17. Warrnambool City Council<br />
18. Yarriambiack Shire<br />
<strong>Health</strong> Services<br />
C<strong>on</strong>sumer Organisati<strong>on</strong>s<br />
Provider Agencies<br />
19. Barw<strong>on</strong> <strong>Health</strong><br />
20. Royal Children’s Hospital<br />
21. San Remo and District Community <strong>Health</strong> Centre<br />
22. Wimmera <strong>Health</strong> Group – Horsham<br />
23. Yarra Ranges Community <strong>Health</strong> Service<br />
24. Alzheimer’s Associati<strong>on</strong><br />
25. Australian Polish Society<br />
26. Associati<strong>on</strong> for Children with a Disability<br />
27. Carers Victoria<br />
28. Jewish Care<br />
29. Uniting Care<br />
30. Royal District Nursing Service<br />
31. Victorian <strong>Health</strong>care Associati<strong>on</strong> (VHA)<br />
32. Victorian Aged, <strong>Health</strong> and Extended Care (VAHEC)<br />
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Appendix 2: ABS Disability, Ageing and Carers Survey<br />
Definiti<strong>on</strong>s and Frequently Asked Questi<strong>on</strong>s<br />
1. Definiti<strong>on</strong>s used in the ABS Disability, Ageing and Carers Survey, 1998<br />
Source: Disability, Ageing and Carers: Summary <strong>of</strong> Findings. ABS Catalogue No. 4430.0<br />
A pers<strong>on</strong> has a disability<br />
If he/she has <strong>on</strong>e <strong>of</strong> the following, that has<br />
lasted or is likely to last for 6 m<strong>on</strong>ths or more<br />
• Loss <strong>of</strong> sight (not corrected by glasses)<br />
• Loss <strong>of</strong> hearing (with difficulty in<br />
communicating or use <strong>of</strong> aids)<br />
• Loss <strong>of</strong> speech<br />
• Chr<strong>on</strong>ic or recurring pain that restricts<br />
everyday activities<br />
• Breathing difficulties that restrict everyday<br />
activities<br />
• Blackouts, fits or loss <strong>of</strong> c<strong>on</strong>sciousness<br />
• Difficulty learning or understanding<br />
• Incomplete use <strong>of</strong> arms or fingers<br />
• Difficulty gripping<br />
• Incomplete use <strong>of</strong> feet or legs<br />
• A nervous or emoti<strong>on</strong>al c<strong>on</strong>diti<strong>on</strong> that<br />
restricts everyday activities<br />
• Restricti<strong>on</strong> in physical activities or physical<br />
work<br />
• Disfigurement or deformity<br />
• Needing help or supervisi<strong>on</strong> because <strong>of</strong> a<br />
mental illness or c<strong>on</strong>diti<strong>on</strong><br />
• Head injury, stroke or other brain damage<br />
with l<strong>on</strong>g terms effects that restrict<br />
everyday activities<br />
• Treatment for any other l<strong>on</strong>g term<br />
c<strong>on</strong>diti<strong>on</strong>, and still restricted in everyday<br />
activities<br />
• Any other l<strong>on</strong>g term c<strong>on</strong>diti<strong>on</strong> that restricts<br />
everyday activities<br />
Specific restricti<strong>on</strong>s are<br />
Core activity restricti<strong>on</strong>s; and/or<br />
Schooling or employment restricti<strong>on</strong>s<br />
Core activities are:<br />
Self care – bathing or showering, dressing, eating,<br />
using the toilet and managing inc<strong>on</strong>tinence;<br />
Mobility – moving around at home and away<br />
from home, getting into or out <strong>of</strong> bed or chair;<br />
and using public transport;<br />
Communicati<strong>on</strong> – understanding and being<br />
understood by others; strangers, family and<br />
friends<br />
Core activity restricti<strong>on</strong>s may be:<br />
Pr<strong>of</strong>ound – unable to perform a core activity, or<br />
always needing assistance;<br />
Severe – sometimes needing assistance to perform<br />
a core activity;<br />
Moderate – not needing assistance, but having<br />
difficulty performing a core activity; and<br />
Mild – having no difficulty performing a core<br />
activity, but using aids and equipment because <strong>of</strong><br />
disability<br />
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Frequently Asked Questi<strong>on</strong>s<br />
A number <strong>of</strong> FAQs that came up in the c<strong>on</strong>sultati<strong>on</strong>s are listed below. Resp<strong>on</strong>ses are drawn<br />
from the Explanatory Notes included in the ABS report Disability, Ageing and Carers:<br />
Summary <strong>of</strong> Findings (ABS Catalogue No. 4430.0, 1998). For those requiring further<br />
informati<strong>on</strong>, the ABS also publishes a comprehensive User Guide that gives detailed accounts<br />
<strong>of</strong> all aspects <strong>of</strong> the survey.<br />
FAQ 1:<br />
What c<strong>on</strong>stitutes moderate, severe and pr<strong>of</strong>ound disability and other elements in the<br />
survey so an informed judgement can be made about its use?<br />
Resp<strong>on</strong>ses: • definiti<strong>on</strong>s used in the 1998 DACS are given in the Box above. .<br />
• levels <strong>of</strong> disability are defined in terms <strong>of</strong> the impact <strong>on</strong> the individual’s<br />
capacity to perform or participate in a number <strong>of</strong> core activities, schooling or<br />
employment<br />
• details <strong>of</strong> core activities and levels <strong>of</strong> restricti<strong>on</strong> are given in the Box above.<br />
FAQ 2:<br />
What questi<strong>on</strong>s were asked in the survey?<br />
Resp<strong>on</strong>ses: • A screening questi<strong>on</strong> is first asked to identify whether any individuals in the<br />
household has a disability.<br />
• Further questi<strong>on</strong>s are then asked about the extent to which the disability restricts<br />
the individual’s capacity to carry out core activities (See User Guide for full<br />
schedule)<br />
a Questi<strong>on</strong>s are asked about help needed, help received from informal sources and<br />
from formal services from subsidised and private providers, and unmet need for<br />
care.<br />
• DACS also asks questi<strong>on</strong>s <strong>on</strong> accommodati<strong>on</strong>, educati<strong>on</strong>, employment, income,<br />
and provisi<strong>on</strong> <strong>of</strong> care.<br />
• Further questi<strong>on</strong>s are asked <strong>of</strong> carers <strong>of</strong> people with disabilities.<br />
FAQ 3:<br />
Was data collected from individuals or provider organisati<strong>on</strong>s? If data was<br />
collected <strong>on</strong>ly from those receiving services, it is not an adequate measure <strong>of</strong> all<br />
need?<br />
Resp<strong>on</strong>ses: • DACS involves a household survey <strong>of</strong> those living in the community.<br />
• A survey <strong>of</strong> “cared accommodati<strong>on</strong>” is carried out to collect data <strong>on</strong> those <strong>of</strong><br />
any age in residential care <strong>of</strong> any kind.<br />
FAQ 4:<br />
Do the survey definiti<strong>on</strong>s reflect c<strong>on</strong>sumers’ perspectives and do the definiti<strong>on</strong>s<br />
capture informati<strong>on</strong> adequately?<br />
Resp<strong>on</strong>ses: • Informati<strong>on</strong> is collected through pers<strong>on</strong>al interviews with people with<br />
disabilities and with carers, c<strong>on</strong>ducted by trained interviewers.<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 93
• In cases where the pers<strong>on</strong> with a disability is unable to answer, informati<strong>on</strong> is<br />
sought from another appropriate member <strong>of</strong> the household, <strong>of</strong>ten a co-resident<br />
carer<br />
• When necessary, interpreters were supplied wherever possible.<br />
• The ABS engages in extensive c<strong>on</strong>sultati<strong>on</strong> with user groups in the course <strong>of</strong><br />
developing each DACS survey, including representatives <strong>of</strong> disability and<br />
older pers<strong>on</strong>s groups.<br />
• The survey forms and questi<strong>on</strong>s are extensively trialled<br />
FAQ 5:<br />
Can rates <strong>of</strong> handicap by LGA be linked to age cohorts and level <strong>of</strong> handicap?<br />
Resp<strong>on</strong>ses: • The rates <strong>of</strong> handicap used in the <strong>RREF</strong> are calculated <strong>on</strong> the basis <strong>of</strong> the age<br />
structure <strong>of</strong> each LGA, for all levels <strong>of</strong> handicap together.<br />
• Separate figures can be calculated for each level, but would be subject to<br />
large errors <strong>of</strong> estimate.<br />
FAQ 6:<br />
Are disability groups with Acquired Brain Injury (ABI), Attenti<strong>on</strong> Deficit<br />
Hyperactivity Disorder (ADHD), chr<strong>on</strong>ic illness and mental health problems<br />
included in the survey?<br />
Resp<strong>on</strong>ses: • the disabilities included in the survey are listed in Box 2.1<br />
• disability is defined in terms <strong>of</strong> the c<strong>on</strong>sequences <strong>of</strong> illness c<strong>on</strong>diti<strong>on</strong>s for<br />
functi<strong>on</strong>ing rather than <strong>on</strong> the basis <strong>of</strong> diseases<br />
• both mental and physical c<strong>on</strong>diti<strong>on</strong>s leading to disability are included<br />
• the requirement that the disability has lasted or is likely to last for 6 m<strong>on</strong>ths<br />
distinguishes chr<strong>on</strong>ic c<strong>on</strong>diti<strong>on</strong>s from short term and acute health problems<br />
FAQ 7:<br />
Is the sample size large enough to provide reliable estimates at LGA level?<br />
Resp<strong>on</strong>ses: • The 1998 sample obtained resp<strong>on</strong>ses from 15,300 dwellings and covered<br />
37,951 pers<strong>on</strong>s, and 400 cared accommodati<strong>on</strong> establishments with 5,716<br />
residents.<br />
• The resp<strong>on</strong>se rate for households was 94.4%<br />
• This sample size was determined so as to enable statistically reliable<br />
estimates <strong>of</strong> the numbers <strong>of</strong> people at each level <strong>of</strong> disability by age and<br />
gender nati<strong>on</strong>ally, in each state, and by LGA .<br />
FAQ 8:<br />
Is the 0-4 age group included in DACS?<br />
Resp<strong>on</strong>ses: • this age group was included in the 1998 survey but not in the 1993 or earlier<br />
DACS<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 94
DACS<br />
• 2.5% <strong>of</strong> children in the 0-4 age group, or 3,700 individuals nati<strong>on</strong>ally, had a<br />
core activity restricti<strong>on</strong><br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 95
APPENDIX 3:<br />
variables<br />
LGA scaled scores and total weightings <strong>on</strong> need<br />
LGA<br />
Median<br />
H’hold Inc.<br />
YLD<br />
Lang other<br />
than English<br />
Koori ARIA Total scaled<br />
score<br />
% need<br />
weighting<br />
Barw<strong>on</strong> South Western<br />
Colac-Otway 8 4 0 1 4 17 37.8<br />
Corangamite 8 7 0 0 4 19 42.2<br />
Glenelg 7 5 0 2 6 20 44.4<br />
Greater Geel<strong>on</strong>g 7 6 1 1 1 16 35.6<br />
Moyne 7 7 0 1 4 19 42.2<br />
Queenscliffe 8 6 1 0 1 16 35.6<br />
Southern Grampians 8 5 0 1 6 20 44.4<br />
Surf Coast 7 4 0 0 2 13 28.9<br />
Warrnambool 8 5 0 2 2 17 37.8<br />
Regi<strong>on</strong>al average 17.4 38.8<br />
Gippsland<br />
Bass Coast 9 5 0 0 3 17 34.0<br />
Baw Baw 7 5 0 1 4 17 37.8<br />
East Gippsland 9 5 0 7 9 30 66.7<br />
La Trobe 7 5 1 2 2 17 37.8<br />
South Gippsland 8 5 0 0 4 17 37.8<br />
Wellingt<strong>on</strong> 8 5 0 1 6 20 44.4<br />
Regi<strong>on</strong>al average 19.7 43.7<br />
Grampians<br />
Ararat 8 7 0 0 4 19 42.2<br />
Ballarat 7 6 0 1 1 15 33.3<br />
Golden Plains 6 4 0 0 3 13 28.9<br />
Hepburn 9 4 0 1 2 16 35.6<br />
Hindmarsh 9 7 0 1 9 26 57.8<br />
Horsham 8 7 0 2 6 23 51.1<br />
Moorabool 6 4 0 1 2 13 28.9<br />
Northern Grampians 8 7 0 1 5 21 46.7<br />
Pyrenees 9 7 0 1 3 20 44.4<br />
West Wimmera 9 7 0 0 9 25 55.6<br />
Yarriambiack 8 7 0 0 8 23 51.1<br />
Regi<strong>on</strong>al average 19.5 43.2<br />
Hume<br />
Alpine 8 5 2 0 6 21 46.7<br />
Delatite 8 5 0 1 5 19 42.2<br />
Greater Sheppart<strong>on</strong> 7 3 1 6 3 20 44.4<br />
Indigo 7 4 0 0 3 14 31.1<br />
Mitchell 6 5 0 1 2 14 31.1<br />
Moira 8 7 0 1 4 20 44.4<br />
Murrindindi 8 5 0 1 4 18 40.0<br />
Strathbogie 9 7 0 1 3 20 44.4<br />
Tow<strong>on</strong>g 8 4 0 0 6 18 40.0<br />
Wangaratta 7 5 0 1 4 17 37.8<br />
Wod<strong>on</strong>ga 6 4 0 1 2 13 28.9<br />
Regi<strong>on</strong>al average 17.6 39.2<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 96
LGA<br />
Median<br />
H’hold Inc.<br />
YLD<br />
Lang other<br />
than English<br />
Koori ARIA Total scaled<br />
score<br />
% need<br />
weighting<br />
Lodd<strong>on</strong> Mallee<br />
Buloke 9 7 0 0 8 24 53.3<br />
Campaspe 8 6 0 3 3 20 44.4<br />
Central Goldfields 9 7 0 0 3 19 42.2<br />
Gannawarra 8 6 0 2 6 22 48.9<br />
Greater Bendigo 8 6 0 1 2 17 37.8<br />
Lodd<strong>on</strong> 9 7 0 0 5 21 46.7<br />
Maced<strong>on</strong> Ranges 4 5 0 0 2 11 24.4<br />
Mildura 8 6 1 4 9 28 62.2<br />
Mount Alexander 9 5 0 1 2 17 37.8<br />
Swan Hill 8 6 1 9 8 32 71.1<br />
Regi<strong>on</strong>al average 21.1 46.9<br />
Western Metro<br />
Brimbank 5 8 9 0 0 22 48.9<br />
Hobs<strong>on</strong>s Bay 5 5 5 0 0 15 33.3<br />
Maribyrn<strong>on</strong>g 8 9 9 0 0 26 57.8<br />
Melbourne 4 6 6 0 0 16 35.6<br />
Melt<strong>on</strong> 4 3 1 0 0 8 17.8<br />
Mo<strong>on</strong>ee Valley 5 3 6 0 0 14 31.1<br />
Wyndham 3 4 3 1 1 12 26.7<br />
16.1 35.9<br />
Northern Metro<br />
Banyule 3 3 2 0 0 8 17.8<br />
Darebin 7 8 8 2 0 25 55.6<br />
Hume 4 9 6 1 1 21 46.7<br />
Moreland 7 5 8 0 0 20 44.4<br />
Nillumbik 0 2 1 0 1 4 8.9<br />
Whittlesea 4 2 8 1 1 16 35.6<br />
Yarra 5 5 6 1 0 17 37.8<br />
Regi<strong>on</strong>al average 15.8 35.2<br />
Eastern Metro<br />
Boro<strong>on</strong>dara 1 1 3 0 0 5 11.1<br />
Knox 2 4 2 0 0 8 17.8<br />
Manningham 1 0 5 0 0 6 13.3<br />
Maro<strong>on</strong>dah 4 4 1 0 0 9 20.0<br />
M<strong>on</strong>ash 3 1 5 0 0 9 20.0<br />
Whitehorse 4 1 3 0 0 8 17.8<br />
Yarra Ranges 4 3 1 1 3 12 26.7<br />
Regi<strong>on</strong>al average 8.1 18.1<br />
Southern Metro<br />
Bayside 2 0 2 0 0 4 8.9<br />
Cardinia 5 4 0 0 1 10 22.2<br />
Casey 3 4 3 0 0 10 22.2<br />
Frankst<strong>on</strong> 5 5 1 0 0 11 24.4<br />
Glen Eira 5 2 4 0 0 11 24.4<br />
Greater Danden<strong>on</strong>g 6 8 9 0 0 23 51.1<br />
Kingst<strong>on</strong> 5 4 4 0 0 13 28.9<br />
Morningt<strong>on</strong> Peninsula 7 5 0 0 1 13 28.9<br />
Port Phillip 5 6 4 0 0 15 33.3<br />
St<strong>on</strong>ningt<strong>on</strong> 3 2 3 0 0 8 17.8<br />
Regi<strong>on</strong>al average 11.8 26.2<br />
<str<strong>on</strong>g>Final</str<strong>on</strong>g> <str<strong>on</strong>g>Report</str<strong>on</strong>g> July <strong>2001</strong> 97
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