The introduction of the ‘Key Personnel’ skills assessment from 1 December 2022 is a positive change to improve safety and culture within the aged care sector. Culture is a difficult thing for any organisation to change, but culture does start with the ‘tone at the top’.
As of 1 December 2022, Providers must have considered the ‘suitability matters’ in relation to all ‘Key Personnel’ and be reasonably satisfied that key personnel are suitable to be involved in the provision of aged care over the next 12 months to 1 December 2023. Providers are then required to conduct a new assessment for any changes in staff and at least every 12 months thereafter.
The more rigorous governance requirement for providers to check those directing and operating care services meet a minimum standard should enable providers to better meet the needs of vulnerable older Australians in care. The accountability and transparency of aged care services are also likely to be improved with the introduction of the ‘Key Personnel’ skills assessment.
The new responsibilities align with existing provider requirements in Standard 8 (Organisational Governance) of the Aged Care Quality Standards as well as elements of Standards 6 (Feedback and Complaints) and 7 (Human Resources).
As with all new governance requirements, the introduction of the ‘Key Personnel’ skills assessment carries with it increased governance compliance requirements, both in time providers must allocate to administrative compliance matters and potentially cost. Just like any other change, it may take some time for providers to adapt/develop processes and procedures to meet the new requirements.
How can providers implement the skills assessment effectively?
Approved providers must keep records that demonstrate they have undertaken the skills assessment process, implying it needs to be a structured assessment, rather than a ‘quick task’ to get the paperwork out of the way.
We expect this may be an initially challenging governance compliance requirement to meet, particularly for small to medium sized providers with boards comprised of more than five persons. For some providers without ability to conduct this assessment themselves, an independent external advisor with suitable clinical and aged care governance qualifications may be required to assist the board to conduct the annual skills assessments of the board and staff. An external advisor brings an independent perspective to the assessment to ensure it is a true and fair assessment of the Board’s skills. However, engaging an external advisor would incur an additional annual compliance cost, which, depending on the size of the organisation and the amount of staff turnover, could be quite high. Providers needing assistance from an external advisor will need to factor in this cost to financial forecasts to ensure the governance requirement can be met each year.
There is a risk that the new requirements may also impact on attraction to boards as the external assessment may cause discomfort for board members, especially those on boards in the community and not for profit part of the sector. These board members are usually well intentioned but time poor and unpaid citizens trying to help their community. The requirement to be assessed as a ‘Key Person’ could limit the number of board members willing to volunteer. However, the skills assessment is possibly very relevant to these board members. Providers should make sure they communicate clearly with new board members about the skills assessment requirement and have a straightforward, unambiguous process to make the assessment as seamless as possible. Directors could also access resources to improve their board governance knowledge by accessing tools such as the free director governance training available from the Department of Health and Aged Care.
We expect some board members may also become concerned with the additional compliance requirements, which may result in existing board members leaving the industry. Whilst this will hopefully reduce the number of unsuitable board members, a reduction in people putting their hands up for a board role would be somewhat concerning given current challenges in attracting and retaining board members. It may result in a push toward board membership becoming paid roles, to encourage participation in the industry. For smaller, community and not for profit operators, director fees may not be financially viable, meaning the providers may find it more difficult to compile a functioning board, potentially impacting operations. However, in the longer-term, paid board positions should attract more director talent to the industry.
Provider boards can get ahead of these challenges by ensuring they have a documented and understood succession plan, comprehensive training for new board members and a chair who can establish a welcoming environment appropriate for the provider organisation. Provider boards should consider seeking external assistance from experts specialising in the application of good board governance.