Final Report on RREF 2001 - Department of Health

Part B: Development of Options for a Revised RREF
6 variables remained covering four broad dimensions of need.
Two variables were indicators of cultural diversity:
• fluency in English/speaking a language other than English at home
• non-English speaking birthplace.
As the correlation between these two variables for LGAs is .99, the choice of one or other will
make no difference statistically. As use of a language other than English at home gives a better
indicator of the home situation and adherence to culture, and especially the likelihood of
needing to use interpreters or staff of the same cultural background in provision of HACC
services, it is seen as a more appropriate indicator of cultural diversity.
⇒ Speaking a language other than English at home to be considered as a need variable
Three variables apart from the IRSED were indicators of socio-economic status. As well as
socio-economic status being an indicator of reliance on HACC services, inclusion of an SES
indicator in weighting the RREF was seen as the most appropriate way of taking capacity to pay
fees into account.
Median household income
Public housing
Take up of benefits: Disability Support Pension, Child Disability Allowance, full-rate Age
Pension
As only a small proportion of the population reside in public housing, household income is seen
as a more appropriate indicator of socio-economic status as it show a wider range of variation
across the whole population. Not only does the household income variable include those with
low incomes in public housing but it also includes low income private renters. Further, assets
are not taken into account, so rural areas with many households having considerable assets in
land but low incomes record low median household incomes.
Careful consideration was given to the choice between median household income and a variable
based on take up of benefits. The variable to be included needs to be a broad indicator of socioeconomic
status, which will also reflect capacity of individuals to pay fees for HACC services
or to make choices to pay for alternative services. Five sets of factors have a bearing on the
choice of the variable:
• Differences in focus. In contrast to the broad eligibility criteria for HACC, the DSP
and CDA are both highly targeted through eligibility based on both means testing and
disability. Take up of these two benefits identifies a very small population with a high
level of need on both these grounds, but this stringent definition excludes those disabled
individuals whose parents or partners have income in excess of mean test limits.
Inclusion of full-rate Age Pensioners only excludes part pensioners who have some
level of handicap and who would pay only limited fees for HACC services.
• Eligibility for DSP and CDA is based on handicap, and so eligible individuals are
covered by the definition of handicap used in DACS. Research commissioned by the
DHS Disability Program reports that DACS data correspond much more closely with
the program client population than DSP and CDA beneficiaries. As DSP and CDA are
both means tested, there is duplication with income variables. Both also have age limits
and other eligibility criteria and so do not cover the whole population consistently.
<strong>Final</strong> <strong>Report</strong> July 2001 37