Final Report on RREF 2001 - Department of Health

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Executive Summary The adjustment for the frail aged in the current RREF was seen to be inadequate and two options were proposed involving (1) inclusion of the total population aged 70 and over living in the community and (2) doubling the 70+ population with core activity restrictions. Options for other adjustment in the base population were proposed in relation to exclusion of the population in residential aged care and disability accommodation. There was considerable debate as to how the veteran population eligible for the new DVA Veterans’ Home Care Program should be treated. While a number of practical issues were raised about the early implementation of the VHC Program, the level of additional resources provided through the program is close to the level of growth funds and hence of considerable relevance to the function of the RREF as a resource allocation tool. Accordingly, the veteran population eligible for the VHC was discounted on the basis of an alternative source of funding being available. 4. The factors which should be taken into account to achieve equity across Victorian Regions in the distribution of HACC resources and the methodology which should be used to apply those factors The main shortcoming of the RREF was seen to be the lack of attention to variables affecting need for HACC services, and a wide array of need factors were proposed in the consultations. Assessment of these variables for inclusion in the RREF is presented in Part B: Step 2 of this <strong>Report</strong>. Profiles of the five variables selected as need indicators are presented at the end of Part B. All of the 29 variables identified in the consultations were assessed; seven have been taken into account in defining the base population and five are proposed as need variables for weighting the RREF, with the remaining variables being set aside as being duplicative or on other grounds such as lack of reliable data. The five variables preferred as indicators of need for HACC services are: 1. Socio-economic status: median household income 2. Health status indicator: healthy years of life lost to disability 3. Cultural diversity: population speaking a language other than English at home 4. Koori population 5. Rurality: Accessibility/Remoteness Index for Australia (ARIA) Replacement of the variable initially considered for health status - life expectancy - with the measure of healthy years of life lost to disability was informed by the DHS Burden of Disease study and is significant as potentially the first application of the results of this study in service planning. There was also extensive discussion of the impact of the shortfall of Commonwealth funded residential care places on HACC, and how this impact might be recognised in the RREF. The decision to exclude this variable was made on resource grounds, consistent with the decision on veterans eligible for VHC, namely that Commonwealth funding for the residential care program should cover the shortfall rather than HACC. All data on the base population and need variables were assembled at the LGA level and regional models built up from the local level. Detailed consideration was given to whether any of the need variables should be given additional weighting and to the number of variables to be included in a revised RREF. A wide range of options was initially modelled and revised models developed with all five of the need variables are seen to capture the main dimensions of need in a formula that retained a high degree of transparency. With regard to weighting, the need variables make different contributions to the overall need weighting, reflecting their distribution across LGAs, but in order to demonstrate the impact of adjusting the weighting of different variables, options were modelled with double weighting of selected variables. The outcome of this adjustment was to increase the effect of the selected variables. <strong>Final</strong> <strong>Report</strong> July 2001 viii
Executive Summary Beyond the detailed consideration that was given to how the Koori population should be scaled as a need variable, it was recognised that including the Koori population as a need variable in the RREF did not guarantee that the goal of better access or more appropriate services would automatically result, and that other complementary strategies would be required by way of continuing Service Development Grants. The particular problems faced by agencies serving Koori populations included the need to operate across LGA and even regional boundaries in some cases. Similarly, recognition of cultural and linguistic diversity as a need variable in the RREF could add to the level of resources allocated to regions with large numbers in these populations, but did not address the nature of services required or the additional costs of service delivery associated with use of interpreter services. Again, Service Development Grants were seen as a means of addressing these issues. 5. The most effective approach to recognising the needs of rural LGAs The needs of rural areas were raised at all stages of the Review and are considered throughout the <strong>Final</strong> <strong>Report</strong>. Under the options developed for a revised RREF, with all LGAs weighted on the same need variables, need weightings show a wide range of need across both rural and metropolitan LGAs rather than a simple rural-urban divide. While rural regions still achieved weightings of at least 30%, the relativity of these weightings has changed as metropolitan regions also receive need weightings. The need weightings apply to only small populations in some rural LGAs and other population trends also affect the outcomes of the RREF. At an early stage in the Review, it was widely argued that other measures needed to be taken to address the higher costs of service delivery in rural areas as performance targets attached to current RREF allocations failed to do so, and rather increased the performance targets that had to be reached. The detailed analysis of need factors across all regions has provided a sounder basis for need weightings in the RREF, and any revision of the unit cost structure in HACC and development of related pricing mechanisms needs to be informed by a similarly detailed investigation of the factors contributing to cost variations, and the extent of those variations across all LGAs. Within rural areas differences between the cost of serving clients living in major rural centres and towns compared to those who were more distant were recognised, and mechanismsaddressing the cost of travel in rural areas need to be specifically targeted to these “distant” clients. The need for any measures taken to address rural needs in HACC to be consistent with approaches to rural services taken in other DHS programs was also emphasised. Uneven access to services that were funded on a region-wide basis also need to be addressed through planning measures as well as through resource allocation. 6. The impact of capacity to raise fees on regional resource allocation There was unanimous agreement from the beginning of the Review that the RREF should not attempt to take direct account of capacity to raise fees for HACC services. Rather, it was considered that this factor should be dealt with indirectly through inclusion of a socio-economic status variable in the RREF. <strong>Final</strong> <strong>Report</strong> July 2001 ix
Page 1 and 2: FINAL REPORT REVIEW OF THE RELATIVE
Page 3 and 4: STEP 3: OPTIONS FOR SCALING NEED VA
Page 5 and 6: ABBREVIATIONS AND NOTE ON TERMINOLO
Page 7 and 8: ACKNOWLEDGEMENTS An exercise as ext
Page 9 and 10: EXECUTIVE SUMMARY The Review of the
Page 11: Executive Summary All regions will
Page 15 and 16: Executive Summary 9. The planning a
Page 17 and 18: PART A: BACKGROUND AND SCOPE OF THE
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Part B: Development of Options for
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Profiles of Need Variables Part B:
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Final Repo
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Final Repo
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Part C: Outcomes In the initial mod
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Part C: Outcomes 5.3 FURTHER ISSUES
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Part C: Outcomes Step 6: Outcomes o
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Part C: Outcomes • The Northern a
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Part C: Outcomes By way of illustra
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Part C: Outcomes The outcomes of th
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Part C: Outcomes 7.4 FURTHER ISSUES
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Four features of the revised outcom
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Part C: Outcomes The adjustment for
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Part D: Achieving Equity in the HAC
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Unit cost structure The unit cost s
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Part D: Achieving Equity in the HAC
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APPENDIX 1.1 continued Commonwealth
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APPENDIX 1.4: SUBMISSIONS RECEIVED
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Frequently Asked Questions A number
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DACS • 2.5% of children in the 0-
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LGA Median H’hold Inc. YLD Lang o
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Department of Human Services 1999b.
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Final Report on RREF 2001 - Department of Health

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