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Home care management fees falling

Recent survey to Approved Providers of home care package services are showing the administration costs are falling as a percentage of the home care package income. The results are strongly reflecting new home care operators coming in with significant lower management fees, and in some cases no fees.

The survey run by Capital Guardians had a sample of 50 respondents and questioned systems used, administration and case management fees charged; and internal cost estimates of servicing the administration needs of home care package clients.

Systems are diverse

Organisations are using a variety of accounting and case management systems. There was no “category killer” software solution, the mixture of case management, accounting systems and manual systems where unique for all respondents.

Management fees falling

The average management fee charged to home care package recipients (administration + case management) was approximately 23%. This could be compared to a survey by KPMG in April 2015 that had the combined fees of case management and administration at 27%.

Fee disclosure on the MyAgedCare website will soon make this more transparent.

Inhouse services to clients very strong

Approximately 55% of all survey respondents delivered over 60% of the services into their homecare packages.

The % home care services delivered with internal staff decreased as the package level increased from level 1 (basic services, lower funding) to level 4 (complex higher funding).

Cost to serve, high, and uncertain

There was a lot of uncertainty from organisations regarding their internal costs of serving customers, the larger they are the harder it was to isolate the costs.

From the survey estimates a reasonably statistical relational between number of packages and internal administration costs to service these packages.

Considering all the statistics for all providers, organisations generally have 0.5 of a staff members (one person two weeks per month) on average overseeing the administrative needs of home care packages that increases at a rate of an extra 24 minutes for every home care package they manage.

By | 2018-12-06T03:31:00+00:00 December 6th, 2018|Homecare|0 Comments

About the Author:

Ross McDonald B.Comm (Hons), CA, MBA, is the founder of Capital Guardians, a ‘paypal’ for aged care offering personal payment service for individuals in supported environments.

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