The legislative scheme
19 An issue such as the one posed in this proceeding calls, more than usual, for an analysis of the relevant legislative scheme as a whole. Both parties' contentions depended on implications being drawn from the scheme, rather than constructional choices as to the meaning of individual provisions, although there are some of those choices to be made as well. Determining which, if any, implications should be drawn from a legislative scheme requires careful attention to the structure of the scheme, its objects and purposes, as well as to the text in relevant parts of the scheme. The Aged Care Act enacts a complex scheme, which turns on the provision of subsidies by the Commonwealth to providers of aged care. As the respondent noted, there is nothing to prevent any person or corporation providing private aged care for individuals on a paid contractual basis, but without subsidies it would be an expensive and difficult undertaking, to say the least. In all practical senses, the provision of subsidies means that the overwhelming majority of Australians in aged care live in facilities regulated by the Aged Care Act.
20 In return for the receipt of a variety of subsidies for providing aged care, persons and corporations submit to close and specific regulation of who can become a provider of aged care, the manner in which they provide aged care to members of the Australian community and the standards to which that care must be provided. Providers also submit to a range of regulations concerning what they may charge people for the provision of aged care. Whether the scheme is exhaustive as to fees and charges is central to the outcome of the proceeding. The scheme also provides for a range of grants to be available to providers of aged care: the grants regime under Ch 5 of the Act is not relevant to the issues in this proceeding, and I do not discuss it any further.
21 The Act implements a regulatory structure consisting, broadly, of direct regulation through the Act itself and regulation through a series of legislative instruments called "Principles" and "Standards". Compliance with these Principles and Standards is sought to be achieved by making compliance a statutory obligation, as part of an approved provider's "responsibilities". These responsibilities are set out in Ch 4 of the Act, specifically in s 54-1.
22 In addition, Principles are a mechanism for establishing eligibility criteria for individuals seeking aged care: see for example the "Approval of Care Recipients Principles" referred to in s 19-2. Principles are also used as the framework for important decisions under the Act applicable to all approved providers: see for example the Allocation Principles in s 11-2 of the Act. The power to make Principles is conferred by s 96-1 of the Act.
23 The structure of the Act is as follows. After an introductory section and overview (to which I return below), the Act deals first with matters relating to the payment of subsidies, including how a person becomes an approved provider of aged care and so eligible for the payment of subsidy and an allocation of places (Ch 2). This Chapter also deals with the classification of care recipients into different categories, according to the level of care the care recipient needs, relative to the needs of other care recipients: see s 25-1.
24 Chapter 2 also deals with the ability of approved providers to charge higher fees to some residents, where the approved provider has "extra service status" and has been allocated "extra service places". These places are dealt with in Pt 2.5 of Ch 2 and are places where residential care "involve[s] providing a significantly higher standard of accommodation, food and services to care recipients": see s 30-1.
25 Chapter 3 deals with the payment of subsidies. Some emphasis was placed on this Chapter, and it is appropriate to set out the statutory description of the Chapter, contained in s 40-1.
40-1 What this Chapter is about
The Commonwealth pays *subsidies under this Chapter to approved providers for *aged care that has been provided. These subsidies are:
• *residential care subsidy (see Part 3.1);
• *home care subsidy (see Part 3.2);
• *flexible care subsidy (see Part 3.3).
A number of approvals and other decisions may need to have been made under Chapter 2 before a particular kind of payment can be made (see section 5‑2). For example, an approved provider can only receive subsidy for providing residential care or flexible care in respect of which a *place has been allocated. Receipt of payments under this Chapter gives rise to certain responsibilities, that are dealt with in Chapter 4.
26 The definition of "residential care" is relevant to the parties' respective contentions:
41‑3 Meaning of residential care
(1) Residential care is personal care or nursing care, or both personal care and nursing care, that:
(a) is provided to a person in a residential facility in which the person is also provided with accommodation that includes:
(i) appropriate staffing to meet the nursing and personal care needs of the person; and
(ii) meals and cleaning services; and
(iii) furnishings, furniture and equipment for the provision of that care and accommodation; and
(b) meets any other requirements specified in the Subsidy Principles.
(2) However, residential care does not include any of the following:
(a) care provided to a person in the person's private home;
(b) care provided in a hospital or in a psychiatric facility;
(c) care provided in a facility that primarily provides care to people who are not frail and aged;
(d) care that is specified in the Subsidy Principles not to be residential care.
27 The word "care" is a defined term, but the term "care needs" is not. However, the Quality of Care Principles 2014 set out various lists of "care and services" that must be provided by residential care services to all care recipients who need them: see Sch 1. A residential care service operated by an approved provider must be accredited: see s 42-4. This scheme regulates not only who provides aged care, but to whom, and where it is provided.
28 There is a detailed set of prescriptions in Div 44 of Ch 3 concerning how residential care subsidies are calculated. Whatever the level of subsidy (largely depending on the particular resident and her or his needs), the payment is on a per resident basis: that is, the measure chosen by the legislative scheme is a payment per individual resident. There are some specified circumstances in which reductions in subsidies will occur - for example, where a resident has receive compensation for her or his ongoing care through a judgment or legal settlement (s 44-20). Division 44 also contains extensive provision for means testing of residents as part of the calculation of payable subsidy. There are provisions for the payment of a range of subsidy "supplements" in respect of individual residents, if the statutory requirements are met (for example, there is a hardship supplement - s 44-31 - where the Secretary "is satisfied that paying a daily amount of resident fees of more than the amount specified in the determination would cause the care recipient financial hardship"). There are other forms of subsidies for which Div 44 provides, (home care and flexible care subsidies for example): they are not relevant to the present issues because they do not involve the payment for the provision of residential care on a full-time basis, which is the circumstance in which the ARC is payable.
29 Chapter 3A deals with fees and payments and, unsurprisingly given the nature of the ARC, is a part of the Act on which considerable reliance was placed by the parties. Section 52A-1 sets out the legislature's summary of what Ch 3A is about:
52A‑1 What this Chapter is about
Care recipients contribute to the cost of their care by paying resident fees or home care fees (see Part 3A.1).
Care recipients may pay for, or contribute to the cost of, accommodation provided with residential care or eligible flexible care by paying an *accommodation payment or an *accommodation contribution (see Part 3A.2).
Accommodation payments or accommodation contributions may be paid by:
• *daily payments; or
• *refundable deposit; or
• a combination of refundable deposit and daily payments.
Rules for managing refundable deposits, *accommodation bonds and *entry contributions are set out in Part 3A.3. Accommodation bonds and entry contributions are paid under the Aged Care (Transitional Provisions) Act 1997.
30 The respondent directs attention to the description of what resident fees and accommodation payments are expressed to be for: namely, a payment for residents' own care ("their care") and accommodation ("their accommodation"). The respondent makes a similar textual point about other provisions such as s 52A-1, s 52E-1 and in s 3A-3.
31 Aside from "home care fees", which are not relevant to the construction question, the two principal kinds of payments for which Ch 3A provides, in relation to people who are in residential care, are "resident fees" and "accommodation contributions".
32 Section 52C-2(1) provides a description of resident fees:
Fees charged to a care recipient for, or in connection with, residential care provided to the care recipient through a residential care service are resident fees.
33 The respondent again emphasises that the focus of these provisions is on payment for services rendered "to" the care recipient, not payments for future services. Regis does not disagree: these sorts of textual indications are also relied on by Regis to contend that the scheme does not seek to touch, or reach, payments such as the ARC.
34 By s 52C-2(2) there are express caps placed on the amount that an approved provider can charge by way of resident fees. The caps operate by reference first, to the "maximum daily amount" worked out in accordance with s 52C-3, and second by reference to amounts specified or worked out in accordance with (and therefore allowed to be charged) in the Fees and Payments Principles 2014 (No. 2). By s 52C-2(2)(a) the resident fee "must not exceed" the sum of fees permitted in accordance with these two sources of authorisation. The remainder of s 52C-2 imposes other restrictions on the circumstances in which fees may be charged - only one month in advance, no payments for periods prior to entry into residential care - and provides for refunds of fees that were paid in advance in the event that a resident dies or leaves residential care.
35 The terms of the cap imposed under the Act by s 52C-3 assume some significance. That provision sets out the "steps" in making a calculation of the resident fee. Although only Step 5 is of present relevance, I reproduce the entire set of steps so the context is clear:
Resident fee calculator
Step 1. Work out the *standard resident contribution for the care recipient using section 52C‑4.
Step 2. Add the compensation payment fee (if any) for the care recipient for the day in question (see subsection (2)).
Step 3. Add the means tested care fee (if any) for the care recipient for that day (see subsection (3)).
Step 4. Subtract the amount of any hardship supplement applicable to the care recipient for the day in question under section 44‑30.
Step 5. Add any other amounts agreed between the care recipient and the approved provider in accordance with the Fees and Payments Principles.
Step 6. If, on the day in question, the *place in respect of which residential care is provided to the care recipient has *extra service status, add the extra service fee in respect of the place.
The result is the maximum daily amount of resident fees for the care recipient.
36 Division 52E of Ch 3A deals with accommodation contributions. Previously, the Act provided for the payment of "accommodation bonds". The present scheme in Ch 3A was introduced in 2013 by the Aged Care (Living Longer Living Better) Act 2013 (Cth), which as Regis submitted contained some major reforms to the legislative scheme.
37 Regis submitted, and I accept, that s 96-1 (the Principle making power) was amended by the 2013 amendments to empower the Secretary to make Fees and Payments Principles, reflecting the introduction of Ch 3A into the scheme. The Quality of Care Principles and the User Rights Principles 2014 (each of some relevance to the construction arguments) were also remade in 2014 following the 2013 legislative changes.
38 Section 52F-1 obliges an approved provider to offer to a person, prior to the person entering residential care, an "accommodation agreement", and to enter into an accommodation agreement either before, or within 28 days after, the person enters the residential care service: s 52F-2(1). An accommodation agreement is defined in the Dictionary to mean an agreement that meets the requirements of s 52F-3, its general purpose being to address matters concerned with the accommodation payment and refundable accommodation deposits. Section 52F-3 sets out a number of matters which must be dealt with in the agreement for it to meet the definition of an accommodation agreement. There was no dispute between the parties that an accommodation agreement is usually incorporated into a resident agreement to form one contractual document. It is not in dispute between the parties that the pro forma agreement in evidence, which also contains the disputed cl 7, is otherwise an agreement which meets the requirements of being a resident agreement and an accommodation agreement.
39 This is, I consider, a not insignificant point. The agreement by which Regis seeks to impose, and have a prospective care recipient agree to pay, the ARC is one and the same agreement as the agreement required by the legislative scheme.
40 Accommodation agreements are required by s 52F-3 to set out whether a person will pay an accommodation payment (for example, to cover the costs for all of her or his care) or make an accommodation contribution (a sum towards payment for all of her or his care), the latter being a means tested option.
41 The Secretary has the power to reduce the accommodation payment or contribution of an individual to nil, for example in circumstances of financial hardship: see s 52F-3(d), read with s 52K-1. Powers such as this have a direct effect on the contractual freedoms of the approved provider and the prospective aged care recipient.
42 Care recipients may elect to pay their accommodation payment or contribution by way of daily payments, or by way of a combination of a refundable deposit and daily payments: see s 52F-3(e). Accommodation agreements must reflect that they have that choice, with the choice to be made within 28 days of the date of entering an aged care facility. A person cannot be forced by an approved provider to choose how she or he will pay before entering an aged care facility: s 52F-4. Thus, these provisions not only prescribe what an agreement must contain, but what it must not, and at times they extend to proscribing contractual conduct on behalf of approved providers.
43 Division 52G then regulates the way approved providers can charge for accommodation payments and accommodation contributions, including by providing for ministerial determinations of maximum amounts for each kind of payment: see, for example s 52G-3. Again, the scheme intends the executive to be able to affect the contractual relationship between the parties by capping accommodation charges that approved providers can ask prospective residents to pay.
44 The remainder of s 52F-3 prescribes in considerable detail what an accommodation agreement must contain in relation to each of an accommodation payment and an accommodation contribution.
45 The provisions about the payment, and return, of refundable deposits should be mentioned. That is because it is part of the respondent's contextual argument that approved providers are able to draw on the funds held on account of residents' refundable deposits for the purposes of building and infrastructure works (and other purposes), where those works are not directly related to the care of any individual resident: see s 52J-6. Regis did not dispute that these funds were such a source: it simply contended they were not the only source. Refundable deposits are a flexible way (including after a person has entered an aged care facility) of adjusting the amount a person may need to pay by way of a daily payment (without altering the total sum payable): see s 52J-2. Approved providers are prohibited by s 52J-5 from accepting refundable deposits which, in the circumstances specified, would leave a person with assets below the "minimum permissible asset value" set by the statute. In other words, this is a provision designed to prevent approved providers from encouraging, or requiring, aged care residents to provide such large lump sums that their asset base is unduly depleted. It should be borne in mind this restriction is imposed, as the respondent contended, in circumstances where approved providers have access to refundable deposits for capital works and improvement purposes. Provisions such as s 52J-5 are designed to preclude approved providers requiring too great a lump sum from people, so the approved providers can use the money in the meantime.
46 The respondent submits, correctly in my opinion, that this feature of the scheme reflects a legislative intention that prospective and current residential care recipients not be required to pay more than they can afford by way of a lump sum. Again, Regis submits the Parliament has clearly identified the circumstances in which it will impose those restrictions, and has - in this case - limited those circumstances to refundable deposits. The ARC forms no part of the refundable deposit amount paid by any individual care recipient, although Regis submits it is not precluded by the Act from deducting the ARC from a refundable deposit if a care recipient agrees. That submission of course is premised on the ARC being a permissible charge or fee. Regis also calls in aid the text of the scheme in relation to refundable deposits. It submits that Div 52J, and s 52J-7 in particular, is one example of where the legislative scheme expressly contemplates an approved provider may, through a contractual agreement with a residential care recipient, be paid sums of money by that recipient over and above what is regulated under the Act by way of residents' fees and accommodation payments or contributions. Section 52J-7 concerns the ways in which a refundable deposit may be used, not the "income derived" from such a sum (that is, as I have noted, dealt with in s 52J-6). It provides only two ways in which sums may be deducted, and by s 52J-7(3), prohibits any other deductions:
52J‑7 Amounts to be deducted from refundable deposits
(1) An approved provider must deduct a *daily payment from a *refundable deposit paid by a person if:
(a) the person has requested the deduction in writing; and
(b) the daily payment is payable by the person.
(2) An approved provider may deduct the following from a *refundable deposit paid by a person:
(a) the amounts specified in the Fees and Payments Principles that may be deducted when the person leaves the service;
(b) any amounts that the person has agreed in writing may be deducted;
(c) such other amounts (if any) as are specified in the Fees and Payments Principles.
(3) The approved provider must not deduct any other amount from a *refundable deposit.
47 Regis relies on para 2(b), and its textual width, to submit that this provision is an example of the way in which the legislative scheme preserves contractual freedom between an approved provider and a residential care recipient. Consistently with some of the extrinsic material introducing Ch 3A, Regis submits this provision is an example of the legislature's intention (at least, after the 2013 amendments) to enact a scheme which gave residential care recipients more informed choices. Regis relied on passages from the Minister's second reading speech, such as the following:
Getting the right aged care will no longer be left to chance. People will be able to get the aged care they want and need, no matter where they live and what their financial means.
People will have more choice, more control, more support and more independence. They will be helped to stay in their own home for as long as they possibly can and will have better access to residential care should they need it.
…
Older Australians will be able to make more informed decisions knowing the aged-care services that are available, the fees they may be expected to pay, and the quality of services they can expect to receive.
…
We are supporting aged-care providers to deliver the quantity, the quality and the diversity of care that we need now and that we are going to require even more of into the future.
...
The changes included in the Aged Care (Living Longer Living Better) Bill 2013 and related bills implement reforms in four key areas:
• reforms that focus on end-to-end aged care;
• reforms that provide greater choice and control for consumers;
• reforms that provide more sustainable and modernised financing arrangements; and
• reforms that ensure independent advice and oversight to support the changes.
…
48 The caution with which courts should approach extrinsic material as a tool in ascertaining the proper construction of a provision in a statute, especially second reading speeches, is well established: Re Bolton; Ex parte Beane (1987) HCA 12; 162 CLR 514 at [518] (Mason CJ, Wilson and Dawson JJ); Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (Northern Territory) [2009] HCA 41; 239 CLR 27 at [47] (Hayne, Heydon, Crennan and Kiefel JJ); Saeed v Minister for Immigration and Citizenship [2010] HCA 23; 241 CLR 252 at [33] (French CJ and Gummow, Hayne, Crennan and Kiefel JJ).
49 Even if I were actively to consider the Minister's words in determining whether there was or was not a prohibition of the kind the respondent contends, or whether the Act contains no such prohibition and impliedly allows for a payment such as the ARC to be charged (as Regis contends), I do not consider them of any assistance in determining which contention should be accepted. The use of the word "choice", in context, directs attention to those features of the scheme that widen the options for aged care - for example, home based care and subsidies payable for it. There is an element of choice in allowing a person to agree to have payments for care deducted from her or his refundable deposit, rather than having to find the money separately - that is the preferable construction for s 52J-7(2)(b). Use of the word "choice" in this context suggests a decision between options in the light of what might be most appropriate for a person's aged care, bearing in mind that it may be the case that it is not the older individual who is making these "choices", but her or his family. Similarly with the concept of "control". For the reasons I set out in the next paragraph, Regis' insistence that its prospective residents pay the ARC is neither an incident of choice, nor an incident of control, for "consumers".
50 I do not find Regis' reliance on the notion of contractual freedom persuasive. I do not consider that the ARC has anything to do with contractual freedom. It is an additional price extracted by Regis from all who wish to enter one of its facilities (subject to the exception I have mentioned in [14] above). It is imposed as an integral part of any entry by a person to one of Regis' facilities, on a "take it or leave it" basis. It is not a fee from which the individual resident derives any benefit: it does not secure for the resident better living conditions, additional services or (for example) more one-on-one care. Being of no benefit to the individual resident, it is difficult to conceive how this fee plays any part in the choice of which aged care facility to enter, or what level of care and service to seek, other than as a deterrent, or as simply the "price" a person accepts she or he must pay if she or he otherwise chooses to enter one of Regis' facilities.
51 Division 52M of Pt 3A.3 deals with prudential requirements for the management of refundable deposits and is contended to be of relevance to the construction question. The Fees and Payments Principles are, by s 52M-1, intended to deal with the protection of residents' funds which have been paid to approved providers, in the form of refundable deposits, accommodation bond balances and entry contribution balances (the latter two being from earlier regimes). Regis submitted, and the respondent did not dispute, that the Minister determines the maximum refundable deposit amount under s 52G-3, unless the approved provider obtains approval of the Aged Care Pricing Commissioner to charge a higher amount: s 52G-4. The current maximum amount determined by the Minister is $550,000.
52 The respondent relies on the prohibition in s 52N-1, restricting the use of refundable deposits to "permitted uses". This includes certain capital expenditure, if it is permitted by the Fees and Payments Principles: see s 52N-1(2)(a), and also (g). The respondent's point, which I accept has force, is that the scheme carefully regulates how approved providers may use the funds they receive from residents, which have been paid in respect of the care of residents. Where the scheme contemplates expenditure of funds received from residents on matters other than their own care, it carefully delineates the circumstances in which that can occur.
53 It would seem, by reason of the terms of s 52J-6, that "income derived" from refundable deposits, is not subject to close regulation by the scheme, in contrast to the refundable deposits themselves, the use of which is strictly regulated. Rather, if a refundable deposit has been invested (as the terms of s 52N-1(2) expressly contemplate), then the approved provider is entitled to keep, and use, any additional income generated.
54 The seriousness with which contraventions of these restrictions are viewed by the Parliament is evident in the creation of the offences in s 52N-2.
55 Chapter 4 deals with the "responsibilities" of approved providers and contains the second of the two provisions upon which both parties concentrated in their submissions (the first being s 52J-7). Once again, it is helpful to set out the statutory explanation of the Chapter:
53‑1 What this Chapter is about
Approved providers have responsibilities in relation to *aged care they provide through their *aged care services. These responsibilities relate to:
• the quality of care they provide (see Part 4.1);
• user rights for the people to whom the care is provided (see Part 4.2);
• accountability for the care that is provided, and the basic suitability of their *key personnel (see Part 4.3).
Sanctions may be imposed under Part 4.4 on approved providers who do not meet their responsibilities.
Note: The responsibilities of an approved provider in respect of an *aged care service cover all the care recipients in the service who are approved under Part 2.3 as recipients of the type of *aged care provided through the service, as well as those in respect of whom a subsidy is payable.
56 Section 53-2 should also be noted. There are other provisions in the Aged Care Act to similar effect. It provides:
53‑2 Failure to meet responsibilities does not have consequences apart from under this Act
(1) If:
(a) an approved provider fails to meet a responsibility under this Chapter; and
(b) the failure does not give rise to an offence;
the failure has no consequences under any law other than this Act.
(2) However, if the act or omission that constitutes that failure also constitutes a breach of an obligation under another law, this section does not affect the operation of any law in relation to that breach of obligation.
57 Sub-section (2) would appear to preserve, amongst other things, the availability of actions in contract by residents. This may provide some limited support for Regis' contentions.
58 The Chapter is then divided up into various categories of provider responsibilities, namely responsibilities:
(1) under Pt 4.1 as to the quality of care they provide (See also certain of the Quality of Care Principles that regulate this aspect of providers' responsibilities);
(2) under Pt 4.2 as to respecting and abiding the rights of "users" of aged care services (this extends beyond care recipients and applies, in some circumstances to their families and persons acting for them:: see the User Rights Principles), and then as to their "general responsibilities" in s 56-1.
59 It is this latter provision on which considerable emphasis was placed in submissions. The section is lengthy, but it should be set out.
56‑1 Responsibilities of approved providers - residential care
The responsibilities of an approved provider in relation to a care recipient to whom the approved provider provides, or is to provide, residential care are as follows:
(a) if the care recipient is not a *continuing care recipient:
(i) to charge no more for provision of the care and services that it is the approved provider's responsibility to provide under paragraph 54‑1(1)(a) than the amount permitted under Division 52C; and
(ii) to comply with the other rules relating to resident fees set out in section 52C‑2; and
(iii) to comply with the requirements of Part 3A.2 in relation to any *accommodation payment or *accommodation contribution charged to the care recipient;
(b) if the care recipient is a continuing care recipient:
(i) to charge no more for provision of the care and services that it is the approved provider's responsibility to provide under paragraph 54‑1(1)(a) than the amount permitted under Division 58 of the Aged Care (Transitional Provisions) Act 1997; and
(ii) to comply with the other rules relating to resident fees set out in section 58‑1 of the Aged Care (Transitional Provisions) Act 1997; and
(iii) to comply with Division 57 of the Aged Care (Transitional Provisions) Act 1997 in relation to any *accommodation bond, and Division 57A of that Act in relation to any *accommodation charge, charged to the care recipient
(c) in relation to an *entry contribution given or loaned under a *formal agreement binding the approved provider and the care recipient - to comply with the requirements of:
(i) the Prudential Standards made under section 52M‑1; and
(ii) the Aged Care (Transitional Provisions) Principles made under the Aged Care (Transitional Provisions) Act 1997;
(d) to charge no more than the amount permitted under the Fees and Payments Principles by way of a booking fee for *respite care;
(e) to charge no more for any other care or services than an amount agreed beforehand with the care recipient, and to give the care recipient an itemised account of the other care or services;
(f) to provide such security of tenure for the care recipient's *place in the service as is specified in the User Rights Principles;
(g) to comply with the requirements of Division 36 in relation to *extra service agreements;
(ga) to comply with the requirements of Part 3A.3 in relation to managing *refundable deposits, accommodation bonds and entry contributions;
(h) to offer to enter into a *resident agreement with the care recipient, and, if the care recipient wishes, to enter into such an agreement;
(i) to comply with the requirements of Division 62 in relation to *personal information relating to the care recipient;
(j) to comply with the requirements of section 56‑4 in relation to resolution of complaints;
(k) to allow people acting for care recipients to have such access to the service as is specified in the User Rights Principles;
(l) to allow people acting for bodies that have been paid *advocacy grants under Part 5.5, or *community visitors grants under Part 5.6, to have such access to the service as is specified in the User Rights Principles;
(m) not to act in a way which is inconsistent with any rights and responsibilities of care recipients that are specified in the User Rights Principles;
(n) such other responsibilities as are specified in the Fees and Payments Principles and the User Rights Principles.
60 A "continuing care recipient" is a person who entered care after 1 July 2014: namely, when the 2013 amendments took effect. These are the only people who are required to pay the ARC.
61 The respondent submits that the first part of the provision makes it clear that the entire provision concerns responsibilities of providers in providing residential care. Section 41-3 defines residential care:
41‑3 Meaning of residential care
(1) Residential care is personal care or nursing care, or both personal care and nursing care, that:
(a) is provided to a person in a residential facility in which the person is also provided with accommodation that includes:
(i) appropriate staffing to meet the nursing and personal care needs of the person; and
(ii) meals and cleaning services; and
(iii) furnishings, furniture and equipment for the provision of that care and accommodation; and
(b) meets any other requirements specified in the Subsidy Principles.
(2) However, residential care does not include any of the following:
(a) care provided to a person in the person's private home;
(b) care provided in a hospital or in a psychiatric facility;
(c) care provided in a facility that primarily provides care to people who are not frail and aged;
(d) care that is specified in the Subsidy Principles not to be residential care.
62 It is apparent from this definition that not only does s 41-3 explain what is meant by "care" but also by the use of the term "residential", it explains where that care is delivered, and types of care delivered in places which will not fall within the meaning of "residential care". As such, it is squarely aimed at the care provided to people such as that provided by Regis at its facilities which are the subject of this proceeding.
63 These are, as the heading to Div 56 as well as its content suggests, the responsibilities of approved providers in relation to "user rights". In other words, the statute is seeking by this provision to identify all the aspects of the relationship between an approved provider and care recipients with which the statute is concerned. That relationship includes a contractual relationship, but is not limited to that. An approved provider's responsibilities in relation to user rights reflect other legal relationships, such as duty of care and prudential obligations and protection of a resident's privacy and confidentiality.
64 The scheme is thus intended to comprehend many aspects of the relationship between an approved provider and the individual to whom residential care is provided, beyond the contractual. I accept it is not intended to be exhaustive, otherwise provisions such as s 52F-7 and s 53-2 would be unnecessary. I need not decide exactly what is left outside s 56-1. It suffices to say, for the reasons I explain, that I consider the Act, and the terms of s 56-1, intend to be exhaustive of the fees which can be levied or charged to persons who become recipients of residential care. Amongst the other reasons I set out, that is because the legislative scheme expressly ties the receipt of subsidy to the imposition of these responsibilities. Section 56-5 illustrates this proposition:
56‑5 Extent to which responsibilities apply
The responsibilities under this Division apply in relation to matters concerning any person to whom the approved provider provides, or is to provide, care through an *aged care service only if:
(a) *subsidy is payable for the provision of care to that person; or
(b) both:
(i) the approved provider is approved in respect of the aged care service through which the person is provided, or to be provided, with *aged care and for the type of aged care provided, or to be provided, to the person; and
(ii) the person is approved under Part 2.3 as a recipient of the type of aged care provided, or to be provided, through the service.
65 The link, constantly made in the scheme, is between the provision of subsidy, and control of the conduct of those who provide aged care: that is, provision of public funds for the supply of aged care services to members of the Australian community, in return for the observance of the restrictions the parliament has seen fit to impose. Key amongst them, and more so after the 2013 amendments, are restrictions on the fees that can be charged to recipients of aged care.
66 The scheme sets out other suites of "responsibilities" of approved providers: see for example s 63-1, relating to accountability responsibilities. Section 63-1(2) is in similar terms to s 56-5. Div 63 also contains a range of other responsibilities imposed on approved providers.
67 All of these responsibilities are enforced, or are enforceable, through the sanctions regime contained in Pt 4.4 of the Act. It is not necessary to describe Pt 4.4 in any detail: it suffices to note that the sanctions regime (which can result in the loss of approved provider status and therefore the loss of subsidy payments) demonstrates that Parliament intends the responsibilities imposed on approved providers to be observed, and for subsidies only to be payable to those providers who do observe them.
68 Chapter 5 of the Act deals with grants. All that need be noted about this Chapter is that included within the scheme for the making of grants, are provisions empowering the Secretary to make grants to approved providers (see s 72-1) for "capital works costs", which are defined in s 70-3:
70‑3 Meaning of capital works costs
(1) The capital works costs relating to residential care include, but are not limited to, the following:
(a) the cost of acquiring land on which are, or are to be built, the premises needed for providing that care;
(b) the cost of acquiring, erecting, altering or extending those premises;
(c) the cost of acquiring furniture, fittings or equipment for those premises;
(d) the cost of altering or installing furniture, fittings or equipment on those premises.
(2) However, if:
(a) those premises are, or will be, part of larger premises; and
(b) another part of the larger premises is not, or will not be, connected with the provision of residential care;
any costs that the Secretary is satisfied are attributable to the other part of the larger premises are taken not to be capital works costs relating to the residential care in question.
69 Thus, aside from access to the use of refundable deposits, approved providers also have access to the grants scheme for capital works.
70 Chapter 6 deals with a number of matters collected under the heading of "Administration", including reconsideration and review of decisions made under the Act, record keeping, recovery of overpayments and complaints.
71 Chapter 7 need only be noted as the location of the Principles making power in s 96-1, to which I have already referred.
72 The only other provision in this Chapter which should be noted is s 96-5, which provides for a person "representing" a care recipient to enter into an agreement on behalf of a care recipient, where the care recipient, because of any physical incapacity or mental impairment, is unable to enter into the agreement. I referred to this situation earlier in these reasons: the presence of s 96-5 is a legislative recognition of the not uncommon real-life circumstance that those people entering aged care may lack capacity to contract on their own behalf.
73 The Aged Care Act adopts a flexible approach to that situation, requiring only that there be someone who "represents" the care recipient. The agreement is still made on behalf of the care recipient and, it would appear, the care recipient is the person who remains liable for any fees or charges under the agreement. That would include the ARC. Thus, in relation to Regis' contentions about freedom of contract, and choice, the reality recognised by s 96-5 is that people entering aged care facilities may not, themselves, be making a choice at all.