Nearly a year into Australia’s aged care reforms, access remains difficult, waiting lists persist and costs are unaffordable for many, while flawed assessment and funding systems continue to undermine care.
The gap between the rhetoric and the reality of aged care has never been wider.
In 2022 the Albanese government came to power promising to fix aged care. Reform in response to the Aged Care Royal Commission had already started under the previous Coalition government, but the pace increased after the change of government. The new Labor government fulfilled most of its promises with one notable exception. Between mid-2023 and October 2025, the number of people waiting for a home care package quadrupled from 22,000 to 93,000 and waiting time increased to six to 12 months.
This growth occurred in parallel with the government introducing a new Aged Care Act, proclaiming it a “once-in-a-generation reform“. It commenced on 1 November 2025. Among other changes, it launched the new Support at Home (SAH) program, promising a simpler, fairer and safer system centred on the rights, dignity and needs of older people.
Nearly a year later, the report card is very disappointing. Some improvements have occurred, particularly in residential care staffing. But across the system access to care has become harder, waiting times remain unacceptably long, the waiting numbers still grow, consumer fees are unaffordable for many and SAH has created a new set of problems.
Overall: 4/10 – must try harder and must listen.
Assessment and the algorithm
A major backward step has been replacing professional judgement with an algorithm for determining home care funding levels. Previously, a specialist assessor used evidence and clinical judgement to determine which package level was appropriate. Now, assessors enter information into a computer and an algorithm determines the funding level without reference to services needed. This was the subject of a recent investigation by Four Corners, following considerable public and professional criticism of both the new system and the government, and has triggered further criticism.
The algorithm was introduced without any evidence that it could make better decisions than experienced clinical assessors. The result has been a steady stream of assessments that make no sense to the older person, their family or experienced assessors.
A person’s need for care cannot simply be reduced to scores derived from a standardised assessment and scored against an arbitrary scale. Needs are complex, health issues interact, and the consequences of getting the decision wrong can be literally deadly. The algorithm is severely methodologically flawed and its use is at odds with the rhetoric of a rights-based, person-centred aged care system.
While the algorithm has attracted widespread criticism, the only government response has been a review of the priority algorithm, a separate algorithm that is only required because the government rejected a royal commission recommendation to eliminate waiting lists and deliver aged care to all who need it.
Fundamental questions have not been answered: why is the Albanese government redefining aged care as an insurance scheme rather than a care and support scheme (which the Act says it is) and why should an algorithm designed by unqualified public servants override an experienced clinical assessor’s professional judgement?
The government is yet to acknowledge it is not working, simply dismissing deep structural faults as mere teething problems. There is no plan to fix it. These are not teething problems; they are baked into the design. The right solution is to restore clinical decision making about the supports that older people need while concurrently redesigning the system around person-centred care, as the Aged Care Act requires.
Grade: E
Residential aged care
There is genuinely some good news here. Mandatory staffing requirements have raised the amount of care provided to residents – an important achievement for which the government deserves credit.
But there is a sting in the tail. Providers increasingly report that, when they staff homes to the required standard, funding does not cover their costs. They cannot break even, let alone earn a reasonable return on invested capital, which even non-profits need.
This is not simply the industry complaining. As government sets mandatory staffing standards, it must fund them adequately. Otherwise the policy creates an impossible choice: operate at a loss or cut the care provided to stay financially viable. Neither is sustainable – and providers are increasingly warning that unless funding improves, they will close homes or exit residential care altogether. That should be a red alert, given Australia already faces a major shortage of beds.
Residential aged care also has a capital funding crisis. The government has stopped planning for the number of beds required and has instead left it to the market. But developers can make more money from retirement living than residential aged care. Very few new homes are being built, because the market is investing where returns are better – not where care is most needed.
This comes just as the baby-boom generation moves into their 80s and 90s, the ages at which the need for both home and residential care rises sharply. Australia has created the worst of both worlds: necessary staffing standards that providers report they cannot afford, and construction left to a market with little incentive to build.
Government cannot regulate or politically deal its way out of this. It needs a credible forecasting, funding and capital investment strategy for residential care, or the shortage of places will worsen substantially.
Public hospitals are already acting as de facto aged care homes for thousands of frail and vulnerable people due to both lack of beds and SAH packages. That situation is destined to get worse, with significant flow-on effects for state/territory budgets, for patients requiring acute care, and for patients needing aged care at home, or a bed, but stuck in hospitals which are inappropriate places for long-term care.
Grade: C-
Support at Home (SAH)
This is where the ‘once-in-a-generation reform’ has gone most clearly and drastically wrong, despite increased numbers of packages being released.
SAH was announced as a key government reform to support older people to stay at home for longer. It is not working. People are waiting many months to be assessed and allocated a package. Then almost all get only 60 per cent of what they need, with the government no longer reporting on how many or how long people wait.
After finally receiving a full package, only around two-thirds of approved services are being used. There are three reasons. First, co-payments are too high; the new system has deliberately shifted significant cost onto older people and families. An entitlement that is not affordable is not a genuine entitlement. Second, the failure to plan for the workforce means that there are not enough nurses, personal care workers or allied health professionals. Third, the system is too complicated, requiring older people – many frail, cognitively impaired or otherwise vulnerable – to navigate assessments, classifications, budgets, service agreements and changing rules. Providers themselves struggle with it. It is unsurprising that older people are simply giving up.
The problem is not just waiting times and queues. Even those at the front of the queue are often unable to receive the care and support they need. Dollars allocated are not the same as care received and needs met.
Government invested heavily in SAH and has made adjustments since the launch. But the fundamental design problems remain and there is no plan to fix it.
Grade: D- (generously)
Commonwealth Home Support Program (CHSP)
The CHSP is the odd one out – the part of the system that has kept working consistently in spite of numerous ‘reforms’. For decades it has provided practical assistance – meals, transport, domestic help, social support – through more than 1,000 not-for-profit organisations and local and state governments. Its strengths are what is being lost elsewhere: local relationships, trust, continuity, flexibility and low administrative overheads.
The government originally intended to abolish CHSP and fold it into SAH. However, CHSP is grant-funded, often small scale and volunteer dependent, and not-for-profit; while SAH is a much more complex transactional fee-for-service model. There was never an actual implementation plan. Irrespective, there was never a compelling case for replacing established community infrastructure with an expensive, bureaucratic one.
The government has now reversed course: CHSP will remain. This is the main piece of good news on the report card. But continuation is not enough – CHSP has been underfunded and largely ignored for years, with extensive waiting lists and rising demand, and there is no commitment yet to investment to expand capacity. Keeping it alive without growth risks preserving a program older people need and trust but increasingly cannot access. Indeed, much of the higher than expected demand on SAH flows from the lack of investment in CHSP.
The government deserves credit for recognising CHSP’s ongoing role and importance. Now it needs to finish the job and invest to meet demand. Three years in a holding pattern is simply too long to wait.
Grade: B (could go up or down depending on effort)
The final report
The overall result is at best 4/10 – the 2025 reforms are failing and government is not trying hard enough to fix it.
The new Act promised important rights, introduced stronger regulatory powers, and residential staffing has improved. But the rhetoric of a rights-based Act is little comfort to an older person who cannot get the care they have been assessed as needing, cannot afford the co-payment, cannot find a worker to provide it, is waiting for a residential place, or is told by a bureaucrat-designed algorithm that their assessed need is much less than their experienced assessor’s judgement.
CHSP is the only good news on this report card. Not because the government got the policy right, but because it retreated from its previous position in response to strong, prolonged advocacy. Even there, it is yet to do the hard work of fixing it after a decade of neglect.
There is a lesson here. Sometimes the best reform a government can make is to listen when the evidence, the sector, international experts, and older people themselves tell it that it has got things wrong.
Professor Kathy Eagar AM is Adjunct Professor in the Faculty of Medicine and Health, University of New South Wales and Adjunct Professor in the Faculty of Health, Queensland University of Technology. Professor Eagar has undertaken extensive work in the aged care system over the last two decades. She led the design of the new Australian National Aged Care Classification (AN-ACC) and funding model for residential aged care and undertook research commissioned by the Aged Care Royal Commission on residential aged care staffing. She is on the Board of NSW Meals on Wheels and on the Board of the NSW Older Women’s Network.
Ian Yates
Ian Yates AM is an independent advocate and advisor on public policy in ageing, specialising in aged care, and retirement income policy. He was recently the Acting Inspector-General of Aged Care for two years. He was previously Chief Executive of COTA Australia, inaugural Chair of the Aged Care Council of Elders, a member of the National Aged Care Advisory Council, the Aged Care Quality and Safety Advisory Council, and the Aged Care Financing Authority. He is the current Chair of the Flinders Ageing Alliance and a Director of Carers Australia.