Balancing care, compliance, and costs: Navigating the future of aged care in Australia

Australia's aged care sector is at a critical crossroads. As our population ages, the demand for high-quality care services continues to grow. Yet, providers face multiple challenges, including increased regulatory complexity, evolving community expectations, wage pressures, and workforce shortages. 

These forces are reshaping the aged care industry and prompting a critical question: How can providers address these challenges while maintaining their commitment to compassionate care and financial sustainability? 

At a recent Dayforce webinar, “The aged care balancing act: Centering care in a time of constant change”, co-hosted with Hello Leaders, Dr. Anat Hassner, Chief People and Strategy Officer at Uniting NSW.ACT, and Mark Souter, Director of Value Advisory at Dayforce, spoke about the key trends influencing the sector and strategies for balancing care, compliance, and costs.   

Navigating the regulatory maze 

Australia's aged care regulatory landscape has become increasingly complex, particularly in the wake of the Royal Commission into Aged Care Quality and Safety. New stringent measures aim to ensure the safety and wellbeing of both residents and staff, including: 
 

• Mandatory staffing ratios 

• Increased care minutes per resident 

• New protocols for safety, vaccinations, and staff qualifications 

• Enhanced quality standards and reporting requirements 

The impact of increasing compliance complexity is significant. Dayforce's latest research, Conquering the frontline manager complexity crisis, reveals that 92% of executives report compliance challenges, variable pay, increased data management, and AI impacts as their top concerns. "When governments make regulations without fully understanding the inner workings of aged care services, it creates massive implementation challenges,” Hassner says.  “For aged care service providers, it’s not just about understanding the rules, but about integrating them into our daily operations in a way that enhances, rather than hinders, care delivery." 

Managers don't always have the bandwidth to track the variety of different workforce requirements along with daily operations. In fact, 82% of frontline workforce managers and executives want their organisations to invest in tech that simplifies compliance. This overwhelming majority demonstrates that today's complex regulatory environment goes beyond traditional methods of managing compliance. "Fragmented systems across organisations lead to wasted time, money, and compromised data quality,” Souter notes. “We're seeing providers struggle with siloed data, manual processes, and a lack of real-time visibility into their operations. This impacts both care quality and compliance demonstration during reviews.” 

Integrated systems can tackle this issue head-on, with Hassner sharing a real-life example from her organisation. “It used to take us two people and two months to collect information from different systems and piece it together to deliver Workplace Gender Equality Agency (WGEA) reports,” she shares. “With Dayforce, we can produce that report at the press of a button, giving us a massive time relief going forward.”  

Addressing wage pressure and labour shortages 

Recent structural changes in the sector, including award modifications and a 15% pay increase, aim to tackle workforce shortages and ensure fair compensation. These changes come in response to long-standing concerns about low wages in the sector, which have contributed to recruitment and retention challenges. 

However, these well-intentioned changes have introduced new complexities for aged care providers. "The new classification split between direct and indirect care has created cultural issues and administrative complications,” Hassner explains about the experience at Uniting. “We're now required to make manual interventions across payroll and workforce systems to ensure correct pay for different duties. This not only increases our administrative burden but also risks creating a divide within our workforce." 

Labour shortages further compound these challenges, with the sector facing a projected shortfall of 110,000 workers by 2031 if current trends continue. Contingent workers, hired on an assignment or project basis rather than full-time employees, can help fill these gaps. Dayforce research found that 65% of executives would use more contingent workers if finding the right skills was easier.  

The situation also underscores the importance of internal mobility, especially given that 65% of workers want to advance within their company. Initiatives such as creating clear and flexible career pathways and upskilling opportunities can help lessen the impact of labour shortages, while improving employee satisfaction and retention. 

Maintaining care amidst ongoing change 

The aged care sector must juggle compliance and compassionate care while adapting to emerging trends like the gig economy and increasing workforce fluidity. Flexibility is key, but it comes with fresh challenges and potential impacts on continuity of care. 

Dayforce research reveals that 89% of frontline managers and 86% of workers would consider leaving their jobs for one with a better schedule, highlighting the critical importance of flexible work arrangements in attracting and retaining talent. Hassner shares Uniting's approach to managing this complex balancing act. "There is pressure to get compliance right, but too much focus on it can detract from our purpose. With the help of Uniting’s board and CEO, we made compliance a driver of organisational improvement instead of a box to be checked. We're creating a human-centred culture for employees and customers,” she explains. “We lead with care, recognising that compliance follows naturally from high-quality, human-centred care. We want our frontline employees to focus on holding a hand, not a pen.”   

The key is to shift mindsets from 'What do we need to do to comply?' to 'How can we provide the best possible care?’ So, while focusing on care is the priority, providers must also ensure they have reliable systems to meet regulatory requirements. Technology plays a crucial role here, enabling providers to automate compliance processes and free up staff time for care delivery. 

Looking ahead, Hassner sees at-home care playing a significant role in the future of aged care. “We believe the future of care is at home, which is a very different model and something that in Australia, it’s fair to say we haven’t nailed,” says Hassner. “Technology will be key to delivering services that align with how people manage their personal lives, while also ensuring we maintain high standards of care and meet all regulatory requirements." 

This aligns with broader trends in the sector, such as  the government's recent aged care reforms emphasising increased support for older Australians to remain in their homes longer. Aged care providers will need to adapt their models and leverage technology to be able to deliver high-quality care in diverse settings. 

The future of aged care in Australia will be shaped by providers that successfully adapt to these trends while maintaining their core mission of providing high-quality, compassionate care. It's a challenging journey, but one that holds promise when focusing on people-centric strategies, embracing innovation, and leveraging technology. This approach not only benefits older Australians and the people who work to support them, but also contributes to building a more resilient and sustainable aged care sector for Australia's future. 

Key takeaways 

Focus on care first 

• Turn compliance into an opportunity to enhance care, not just check a box. 

• Centre care in all decision-making to improve resident outcomes while meeting regulatory requirements. 

• Train staff to understand the rationale behind regulations and how they contribute to better care outcomes. 

Invest in the employee experience 

• Create superior employee experiences to drive better customer experiences.  

• Look for opportunities beyond fair compensation, like flexible work arrangements and growth opportunities. 

• Develop personalised career paths with opportunities to upskill and progress within the organisation to optimise your workforce.  

Foster a culture of innovation 

• Encourage creative problem-solving and calculated risk-taking.  

• Create an environment where new ideas are welcomed and tested.  

• Seek board support for care-focused innovations to overcome challenges and enhance care quality.  

Prepare for the future 

• Anticipate the growth of at-home care and the gig economy.  

• Explore at-home care models and how technology such as mobile apps, telehealth solutions, and remote monitoring systems can support them. 

• Consider how the gig economy will impact your workforce planning and quality of care. 

Trust that change is possible 

• Cultivating a growth mindset across the organisation that views change as an opportunity for improvement.  

• Remain proactive in finding solutions, understanding that you can find a way, even with resource constraints.  

• With the right approach and support, successful adaptation is possible. 

Ready to unlock the potential of your frontline workforce? Download our comprehensive report, Conquering the frontline manager complexity crisis, to discover five key areas of opportunity and actionable insights that bridge the gap between executives and managers.