Looking after the needs of older Australians, who are some of the most vulnerable people in our community, is a hands-on, labour intensive system of work that relies on capable, empathetic and competent staff and well managed delivery of care and services.
In an environment that focuses on the front-line delivery of care, governance and risk can often be overlooked, fading into the background as the focus of staff and management turns to the practicalities of providing day to day care, dealing with families, and tending to administrative duties.
Fundamentally, effective governance and risk management in aged care is critical for the provision of safe, effective, appropriate and quality care. Governance sets the organisational leadership’s “tone from the top” through formal policy and codes of conduct. Risk management provides the transparency needed to proactively identify exposures to how well frontline staff deliver care in accordance with the policy and codes of conduct set and expected. Together, governance and risk form crucial elements of organisational governance by connecting the Board and Executive oversight roles to the performance of frontline workers and the rest of the organisation.
What have we learnt from the Royal Commission?
|The governance and risk landscape is reforming following prudential enquiries and increased public scrutiny.|
Specifically, the Royal Commission into Aged Care Quality and Safety (“Royal Commission”) has shown that, in many cases, consumer expectations are not being met - that aged care providers are failing to provide appropriate levels of care to our elderly and that it is not just a result of a one-off failure or “a bad apple”. The findings outlined in the Royal Commission’s Interim Report titled “Neglect”1 show that significant and shocking failures of care have been systemic, organisation-wide failures that are a direct result of poor governance and risk management, with a genesis at Board and Executive levels. The recommendations of the Royal Commission2 proposes a new aged care system based on a person-centred, human rights approach that seeks to protect and enhance the quality of life of older people receiving aged care.
This comes with a range of sector reforms including greater regulatory oversight, changes to funding, more stringent quality and safety standards and increased accountability obligations – all of which will fundamentally change the governance and risk profile of providers.
Provider governance and risk considerations are specifically addressed3 with recommended legislative change that will require providers to have more independent, accountable and skilled boards overseeing more prescribed and robust risk management and attestation processes. These recommendations seek to elevate corporate governance standards to the same level as listed public entities, bringing with it much higher expectations to demonstrate an organisation’s capability and commitment to higher quality care.
Linking governance and risk management to safe, quality care
|Questions to drive reflection and inspire change for aged care providers.|
The outcomes of the Royal Commission, compounded by COVID-19 outbreaks in aged care, indicate that aged care providers – both for profit and not for profit – are far from meeting community and family expectations of quality. What has been evident through the Royal Commission is that when quality care is not delivered, there are also challenges with governance.
In order to undertake the significant change required in the sector to deliver quality outcomes for older Australians, now is the time for Boards and Executive to reflect on the current environment and ask themselves: “How do we know that our organisation is providing safe and quality care”?
Further questions to ask yourself with respect to governance and risk management in this regard are:
- Do we have confidence that we have the governance systems and processes, and culture across our organisation to maintain trusted, high quality care?
- Are we aware of and addressing the risks that can cause us reputational damage?
- Do we identify, monitor and mitigate all risks associated with quality care including consumer neglect and abuse?
- Are we confident that our governance and risk practices would stand up to external scrutiny?
Why the time to prepare is now
If you answered no to any of the questions above, you may need assistance in building your governance and risk capabilities ahead of new and more stringent regulatory scrutiny. It is important that you are prepared and well placed to more broadly meet the new expectations that will be placed on the sector. By addressing your governance and risk landscape now, you will be well prepared for proactive identification and remediation of gaps, in advance of further regulation. Importantly, early assessment of gaps in relation to regulated or non-regulated quality of care expectations, also enables providers to develop longer-term action plans for continuous improvement in outcomes for the aged and ageing.
We are already supporting a range of aged care organisations to be ready for new governance and risk management expectations. Our support is designed to enable Boards and Executive to lead quality of care continuous improvement through good governance and risk management, and this involves understanding how your existing frameworks and processes align to current - and emerging better practice.
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We have the findings from the Royal Commission into Aged Care Quality and Safety, now is the time for action.
We have the findings of the Royal Commission, now is the time for action.
Be confident in managing your business' risk and opportunities with an effective governance, risk and controls environment.
KPMG can help clients develop an effective governance, risk and controls environment.
1. Royal Commission into Aged Care Quality and Safety. Interim Report: Neglect, October 2019 - link
2. Royal Commission into Aged Care Quality and Safety, Final Report: Care, Dignity and Respect, March 2021
3. Royal Commission into Aged Care Quality and Safety, Final Report: Care, Dignity and Respect, March 2021, Recommendations 88,89, 90, Volume 1 page 265