Source: The Brisbane Courier Mail [Jim Toohey]

AUSTRALIA'S baby boomers, with their general fondness for the finer things in life, would have shuddered at a recent Productivity Commission report into the future of aged care.

Aged-care providers in this country are already well aware that baby boomers will demand a far higher standard of accommodation and amenities than their parents and grandparents accepted. They will expect hotel-like accommodation, where interior design, premium leisure activities and fine cuisine will matter as much as a high standard of aged care.

Unfortunately, the recent report from the Productivity Commission predicted a future where the opposite is true.

The only possible interpretation of the report was that without significant changes to aged care funding, service standards in the future will struggle even to match today's levels, let alone reach the lofty heights expected by the next generation of care recipients.

Such warnings from the Australian Government's independent economics research and advisory body will be most disturbing for many baby boomers. The people who really should be genuinely alarmed by the report, however, are Generations X and Y.

They will be the taxpayers who will carry the "significant and growing burden" that will accompany a four-fold increase in care recipients if existing funding mechanisms are retained.

The report says the number of people aged over 85 – and therefore most likely to need aged care – will balloon from about 400,000 today to 1.6 million in 2047.

At the same time, changing patterns of diseases will increase the number of frail older people with complex care needs.

In order to cope with this demand, Australia will need tens of thousands of new aged-care places. These currently cost between $150,000 and $200,000 each to bring on line.

We will need to attract thousands more nurses and carers – presumably through more attractive pay and conditions. Yet even bringing the pay of existing workers up to the same levels as hospital staff will cost about $450 million every year.

We will need to train thousands more nurses, but already our tertiary and training institutes turn away close to one in five eligible students.

Any shortage of aged-care places will affect our entire health sector. Older Australians will increasingly find themselves in hospital beds when aged care is not available. This in turn will lead to longer surgery waiting lists and increased delays in emergency departments.

All of this means that as a nation we have some tough decisions to make.

Do we continue to squeeze a diminishing proportion of the population – taxpayers – to fund adequate care and accommodation for the elderly?

Do we continue to pass the cost of aged care on to future generations, through the tax system? Or is it time that we allowed older Australians to contribute financially to the highest possible quality of care and living conditions for their twilight years?

Residents of low-care facilities (hostels) can currently pay a refundable deposit when they enter aged care, to help fund high-quality accommodation. But a curious and contradictory federal law denies the same right to high-care (nursing home) residents. The result is an increasing gap in the quality of accommodation, quality of life and dignity for older Australians.

Typically, low-care providers have used the refundable contributions of their residents to finance spacious and modern homes, with more private rooms and fewer shared bathrooms and toilets.

High-care residents, locked into the old funding model, have been forced to make do with vastly different facilities.

While the homes are clean and the care is exceptional, the rooms are generally older, smaller and less private.

The Rudd Government did not create the looming crisis – it is an issue that consecutive governments have ignored for two decades.

The Government must lead a very frank discussion of what we will need in the future and how we are going to pay for it.

And it must do it soon. We're simply not getting any younger.

Jim Toohey is the CEO of TriCare and a member of the Aged Care Alliance.

Copyright News Limited – used with permission