THE REASONING OF THE TRIBUNAL
11 Having referred to the statutory scheme (including, somewhat confusingly, certain of the provisions which had replaced the applicable legislation), the Tribunal framed the issue before it as follows (at [24]):
Section 10-3 of the Aged Care Act provides that the Secretary must revoke an approval of a person as a provider of aged care under section 8-1 if the Secretary is satisfied that "the person has ceased to be suitable for approval…". The issue for the Tribunal to consider is whether the Applicant is suitable for approval. That consideration requires an assessment of the Applicant against the criteria contained in section 8-3(1).
12 The Tribunal then proceeded to consider each of the matters set out in s 8-3(1) under a series of separate headings.
13 In relation to s 8-3(1)(a) (applicant's experience in providing aged care or other relevant forms of care), the Tribunal referred to evidence concerning the applicant's corporate structure and history and what it claimed was a long history of providing aged care. Letters of support had been provided, but the Tribunal refer to these as "mainly historic" and not dealing with the applicant's current capacity to provide aged care. Also provided to the Tribunal were numerous certificates of persons apparently engaged by the applicant, together with police checks for some contracted workers. However, the Tribunal observed that "there is no comprehendible list of persons engaged by the Applicant showing their qualifications and whether or not they satisfied police checks" (at [30]).
14 The Tribunal noted that the applicant contended it had been a provider under the National Disability Insurance Scheme (NDIS). There was evidence to show that the applicant had obtained approvals required by the NDIS. However, those documents did not describe the quality of care provided and the Tribunal regarded them as not relevant for the purpose of s 8-3(1)(a).
15 In relation to the applicant's experience in providing aged care, the Tribunal referred to evidence of Ms Yan Wu (who was, in substance at least, the main manager of the applicant) asserting, in effect, that the business was operating well and providing home care with no incidents of concern. This evidence was pitched at a very general level, and it is apparent from observations elsewhere in the Tribunal's reasons that the Deputy President had reservations about the reliability of Ms Wu.
16 The Tribunal concluded at [35]:
The lack of reliable evidence in regard to this consideration [being the applicant's experience in providing aged care] leaves the Tribunal unable to make a conclusive finding. In the absence of compelling evidence, the Tribunal cannot be satisfied as to what level of experience the Applicant holds in providing aged care or other relevant services.
17 In relation to s 8-3(1)(b) (applicant's understanding of its responsibilities), the Tribunal considered a series of allegations of breaches of the Quality of Care Principles 2014 (Cth) (the Quality of Care Principles). Those principles were made by the Minister under s 96-1 of the Act and their content defined, in part, the responsibilities of approved providers under the Act (see, e.g., s 54-1(1)(a), (h)). The allegations were contained in a Final Quality Review Report (the Quality Review), on which the respondent relied, and were said to show that the applicant had failed to demonstrate an understanding of its responsibilities as a provider of home care services.
18 The first issue concerned standards relating to effective management, which Part 1 of Schedule 4 to the Quality of Care Principles divides into eight "matter indicators": corporate governance, regulatory compliance, information management systems, community understanding and engagement, continuous improvement, risk management, human resource management and physical resources.
19 In relation to corporate governance, the Tribunal considered that the Quality Review established that the applicant was "unable to demonstrate an organisational structure, a system for strategic or business planning, nor a transparent and accountable system to manage Home Care Package (HCP) budgets" (at [39]). No self-assessment had been provided in response to a request for such a document in September 2018.
20 At this time, Ms Wu advised the Department that the applicant was now registered in her sister's name (Ms Bing Wu) although Ms Bing Wu appeared to have no role in the management or governance of the company. Ms Wu told the assessors on 27 September 2018 that she was responsible for the company's corporate and business activities. However, "no governance structure existed which would have provided oversight of the operational management of the company and to ensure that the services provided were accountable to stakeholders" (at [40]). The Tribunal concluded that Ms Wu "could not state what governance structures existed for the Applicant but claimed that her computer contained all the required information. However, during an interview Ms Wu experienced difficulty in finding and producing some of the documentation on her computer at the assessment" (at [42]). The Quality Review also recorded feedback from care recipients or their representatives indicating that they did not feel the services provided by the applicant were well-managed.
21 The "finding" recorded by the Tribunal was that "the applicant is unable to demonstrate that it possesses corporate governance processes, that they are effectively implemented, nor that they are sufficiently accountable to stakeholders". In the Tribunal's view, "the Applicant fails to satisfy this matter indicator" (at [44]).
22 Turning to regulatory compliance, the Tribunal referred to three aspects of the evidence before recording a "finding" as follows (at [49]):
the evidence establishes that the Applicant did provide monthly accounts to its clients but that such accounts were not in a comprehensible form and did not provide accessible information. Clause 7 of the Charter of Care Recipients Rights and Responsibilities - Home Care provides that each recipient has the right "(b) to receive invoices that are clear and in a format [that is] understandable". In respect of unspent funds, the Applicant has provided an "Unspent Funds Transfer Form" for use where a transfer of providers occurs. However there is no evidence that such forms have been utilised.
23 Turning next to information management systems, the Tribunal recorded the respondent's claim that the applicant's information management systems could not be easily understood, information on the My Aged Care portal was inaccurate, and the accounting system for managing budgets was not transparent or verifiable. The "finding" on this issue occupied six short paragraphs ([52]-[57]). In summary, they provided as follows:
(a) Only Ms Wu could operate the computer system to locate files and records, the electronic files were not clearly named, and there was no evidence of secure storage and backup.
(b) Upon request in September 2018, Ms Wu could not produce certain key documents.
(c) Information for the applicant on the My Aged Care portal was inaccurate and potentially misleading.
(d) There was no evidence of a transparent accounting system, registers to monitor currency of staff certifications, or a system to record care and progress notes.
(e) The respondent claimed there was no continuous improvement plan, but the applicant produced a document which "purported to satisfy this requirement". The applicant did have a system of recording information management details of each care recipient.
(f) A number of complaints from care recipients and representatives were of no relevance to the issue of information management.
24 The next indicator considered was community understanding. The respondent accepted that this requirement was satisfied (at [59]).
25 In relation to continuous improvement, the Tribunal noted again that the applicant had produced documents which were said to constitute a continuous improvement plan. It concluded that "these documents clearly did not comprise a specific policy. Nor was there any evidence of any system for care recipient complaint reporting and action" (at [62]).
26 Next, as to risk management, the respondent claimed that the applicant had not provided evidence of a framework for risk management. The applicant relied on a document entitled "Governance - Risk Management", which the Tribunal noted was current on 31 March 2020 and had been last edited on 19 August 2019. Some doubt was expressed as to whether the policies contained in the document existed at the time of preparation of the Quality Review Report. The Tribunal found (at [65]):
This document would appear to satisfy this requirement, by providing a framework for risk to be encountered by the Applicant in the delivery of its services. However, there is no governance body nominated to oversee such a system although the policy makes provision for management to be reporting to such a body. There is no evidence that such a body has been used or referred to.
27 As to human resource management, the respondent alleged that the applicant had no system for the safe delivery of care and services to care recipients. It was claimed that no registers were maintained to ensure that staff were appropriately certified; nor was there any evidence of minimum qualification requirements for workers or "pool staff". Workers were said to be recruited for their language proficiencies or cultural backgrounds. There was no provision for support staff to cover the managing director's responsibilities if she was absent.
28 The Tribunal's "finding" referred to two forms that the applicant had produced and concluded that "the specific requirements referred to in the Quality Review have been met by the Applicant" (at [70]).
29 The final indicator on this issue was described as physical resources. The respondent accepted that the applicant satisfied this requirement (at [72]).
30 The next issue traversed by the Tribunal, still under the heading "applicant's understanding of its responsibilities", concerned allegations regarding the Accountability Principles 2014 (Cth) (the Accountability Principles). The Accountability Principles were also made by the Minister under s 96-1. They gave content to some of the responsibilities of approved providers under Division 63 of the Act.
31 The Tribunal recorded a contention by the respondent that the applicant had failed to comply with certain clauses of the Accountability Principles because it failed to provide the Secretary with its aged care financial report within four months of the end of the financial year. No sanction action had been taken in relation to this breach. However, the respondent contended that the Tribunal was entitled to consider it for the purposes of determining the applicant's suitability to provide aged care.
32 The applicant acknowledged that it had failed to provide accounts within the requisite period despite receiving reminders. This was apparently "because it operated a cash accounting system and it was waiting for a statement from the Department of Human Services before it was able to provide the accounts". The failure in this regard related only to one financial period. The Tribunal therefore did not regard this breach as having any serious consequences in itself, although "it does form part of the overall pattern of the Applicant's non-compliance with its obligations" (at [74]).
33 The respondent asserted that the applicant had "knowingly failed" to ensure that its employees obtained and maintained current police certificates as required by the Accountability Principles. The Tribunal referred in this connection to evidence concerning one staff member, who had been reminded in September 2018 that she had not provided a first aid certificate and national police check. At this time, the staff member had already been working for a month. Three months later, Ms Wu sent the staff member another reminder. The required documents were not provided for another month, and "despite this, the staff member was still allowed to work" (at [76]). The Tribunal found at [77] that there was "a clear breach by the Applicant of the requirement to ensure that an employee had obtained a current police check before commencing work".
34 The next issue concerned allegations regarding the User Rights Principles 2014 (Cth) (the User Rights Principles), a further set of principles promulgated by the Minister under s 96-1. These principles give content to some of the responsibilities of approved providers in relation to quality of care under Division 54 of the Act.
35 The respondent asserted that the applicant had not complied with provisions in the User Rights Principles requiring it to provide the Department of Health with pricing information for its services. In a letter dated 13 March 2019, the applicant said that it was its understanding that, from 1 April 2019, there would be "a set pricing for all the providers" and that it had therefore informed all its clients that its pricing would be changed in accordance with the Department's pricing. However, the Tribunal found that "the information provided was pro forma pricing, in some cases published by the NDIS. It did not reflect the prices necessarily to be charged for the services to be provided by the Applicant and was accordingly deficient" (at [79]).
36 It was also asserted that the applicant had not complied with provisions requiring it to provide care recipients with monthly statements of available funds and expenditure. Monthly statements either were not provided, failed to include required details, or were not "clear and understandable".
37 The Tribunal found at [81] that the applicant did provide monthly statements to its clients, but that the statements "were virtually incomprehensible and it is not possible to discern whether a surplus or deficit remains in a care recipient's account". It disagreed with a suggestion by Ms Wu that, if the statements were not clear and understandable, it was the responsibility of the client to seek clarification.
38 The Tribunal next turned to the question of key personnel, noting the definition of that expression in s 8-3A of the Act. It concluded at [84] that the evidence clearly established that Ms Wu was the person who had had the day-to-day conduct of the applicant's business. It then noted that Ms Wu had been declared bankrupt on 1 May 2018 and discharged from bankruptcy on 26 March 2020. On this basis Ms Wu had been, for "a substantial portion of time", a "disqualified person" within the meaning of the Act.
39 In response to a notice to give information under s 9-2 of the Act issued in March 2019, the applicant had advised that Ms Wu was not a current director. A letter to the respondent from Christian Fox, Audit and Assurance dated 4 October 2019 acknowledged that Ms Wu had "from time to time" purported to communicate on behalf of the applicant and asserted clinical responsibility. The letter said (presumably on behalf of the applicant) that this conduct was "not acceptable" and "robust action has been taken to prevent further instances". However, in the Tribunal's view, the evidence showed Ms Wu to have "continued to act despite such assurances". She claimed that the statements concerning her participation in the applicant's affairs were written without her knowledge or authority, and she did not agree with them (at [88]). A resume provided by Ms Wu said that during her bankruptcy she did not act as a director, but as "GM"; however, the duties listed for the two positions were in the Tribunal's view identical.
40 The Tribunal also noted that, upon becoming bankrupt, Ms Wu had transferred her shares in the applicant to Ms Bing Wu, "thereby suggesting that Ms Wu was divesting any control over the applicant in favour of her sister". However, when the respondent carried out assessments, Ms Bing Wu did not attend and Ms Wu provided instructions. Ms Wu had signed various emails to the respondent as "manager", stating later that she had forgotten to change the name on the signature block to that of Ms Bing Wu. In an email sent in April 2019, in response to a notice issued under the Act, Ms Wu had stated that no key personnel of the applicant were disqualified. That, in the Tribunal's understanding, was sent at a time when Ms Wu was herself bankrupt and also purporting to act as key personnel (at [94]).
41 In her statements to the Tribunal, Ms Wu said that during the period of her bankruptcy she had worked voluntarily and claimed no income for her aged care work. She said she had removed herself as a director of the applicant. She said that her sister Ms Bing Wu had acted as managing director during this period and that she had no involvement other than in a voluntary capacity. However, it emerged that Ms Bing Wu had at all times held part-time employment as a teacher (at [97]-[98]).
42 The Tribunal thus found that Ms Wu had conducted herself as a principal of the applicant while she was bankrupt; and that, by doing so, she contravened s 10A-2 of the Act (at [99]).
43 It was also asserted against the applicant that, in contravention of s 8-3A(3) of the Act, Ms Wu had acted as one of the key personnel of the applicant and taken responsibility for nursing services at a time when she did not hold a current qualification in nursing. Ms Wu claimed that she was not responsible for nursing services and that a Ms Chan Nguyen performed that role. Material before the Tribunal indicated that Ms Nguyen had been engaged on 18 April 2019.
44 Ms Wu claimed that Ms Nguyen had commenced with the applicant in 2015, although the records tendered to support this assertion were unsatisfactory. There was also no evidence that Ms Nguyen was a registered nurse at relevant times. The Tribunal observed that, at times when Ms Nguyen was not engaged by the applicant, the only person who could have been responsible for nursing services was Ms Wu (who did not have a current qualification). However, the Tribunal considered that the evidence was inconclusive. At [105], it concluded that it was not able to find that Ms Wu was acting as director of nursing of the applicant prior to the engagement of Ms Nguyen.
45 The respondent also contended that the applicant's response to complaints by care recipients and requests for further information in respect of alleged non-compliance demonstrated that it did not understand its responsibilities. It referred to several disparate matters under this rubric, including writing to the responsible Minister to complain about the Quality and Safety Commission's (the Commission) conduct, failing to provide a continuous improvement plan, failing to attend or cutting short assessment appointments and deleting or failing to provide relevant information. The Tribunal made findings on these disparate matters (at [106]).
46 The next factor considered was that referred to in s 8-3(1)(c) (systems that the applicant has or proposes to have in place to meet its responsibility as a provider). Relying on the matters canvassed in relation to s 8-3(1)(b), the respondent alleged a long history of non-compliance which showed that the applicant did not have adequate systems in place to meet its responsibilities. It was noted that the applicant "acknowledged that it had deficiencies in 'ongoing clinical and administrative management'" (at [108]). The Tribunal then considered the adequacy of the applicant's management systems in various more detailed respects. It recorded the following conclusions:
(a) there was no evidence that a new continuous improvement plan had been utilised (at [113]);
(b) there was a document entitled "governance - consumer care risks" which identified potential risks to the applicant's operations (at [114]);
(c) there was no evidence of any incident register or complaints and feedback register, nor was there a register to monitor currency of staff certifications (at [115]);
(d) there was evidence of at least two incidents in which the applicant had attempted to backdate documents, which was inappropriate (at [116]-[121]);
(e) there was evidence that the applicant had provided inadequate care to a particular client, and an apparent finding that a letter from the client, stating that the applicant had done "a good job", was not genuine (at [122]-[124]);
(f) there were insufficient particulars of an allegation that the applicant had impeded the investigation of complaints by failing to engage with the respondent (at [126]);
(g) the evidence demonstrated a lack of cooperation between the applicant and the respondent, with the applicant's conduct being misleading in many instances including in relation to care recipients (at [128]-[130]);
(h) staff training had been inadequate (at [131]);
(i) effective management practices did not exist - for example, there was no evidence that the applicant maintained a risk management plan, incident register, complaints and feedback register or registers to monitor currency of staff certifications (at [132]);
(j) the applicant did not have adequate systems to oversee the care of clients or the management of their packaged funds in accordance with its responsibilities under Parts 4.1 and 4.2 of the Act (at [133]);
(k) the applicant had failed to take any positive action to address its non-compliance (at [134]-[135]).
47 The Tribunal then turned to the consideration in s 8-3(1)(d) (the applicant's record of financial management, and the methods that the applicant uses to ensure sound financial management). At [137], the Tribunal said that it relied on what it had previously said on the issues of non-compliance with the Accountability Principles and the User Rights Principles in connection with s 8-3(1)(b). However, it referred to the following examples of particular relevance to 8-3(1)(d) of the Act.
(a) Upon learning that a particular client (Ms L) wished to dispense with the applicant's services, the applicant debited her account for the amount of $1,000 in order to indemnify it in anticipation of having to engage lawyers to defend a legal claim. There was evidence of other debits to that client's account in relation to communication with the Commission about her case. Ms Wu claimed that she was entitled to make such debits for the work she had done. The Tribunal did not accept this assertion. No claim was ever made and legal advice was not required. Further, "irrespective, such charge and the other charges were unauthorised and were not for a proper purpose" (at [141]).
(b) The applicant spent "packaged funds" of a client (Mr RL) totalling $16,550.69 on a cruise holiday which was envisaged as being for the client, the client's daughter and Ms Wu. The client did not go on the cruise, and Ms Wu went with the client's daughter. The applicant then intended to suspend its services to the client in the following months, to recoup the amounts that had been expended. In cross-examination, Ms Wu saw no problem with these actions. She apparently maintained that the cruise was "assisted travel" which she could not refuse to undertake. The Tribunal concluded that no assisted travel was involved, and the cruise would not have qualified as "assisted travel" even if the client had not withdrawn. Expenditure of the client's funds on a cruise was "contrary to the purpose for which such funds were provided and clearly does not demonstrate sound financial management" (at [146]).
(c) The Tribunal rejected an allegation of misuse of packaged funds of a third client (Ms F) (at [148]).
(d) In relation to another client (Ms DV), the Tribunal found that excessive and unjustified charges were debited to her account totalling $650. The Tribunal rejected Ms Wu's view that these charges were justified (at [151]-[153]).
(e) The applicant had said in correspondence to the respondent that it planned to seek professional advice from outside experts in relation to its financial management deficiencies. The respondent submitted that little weight could be given to this assertion, as such assistance had been sought only belatedly and there was no evidence of any actual advice or recommendations having been received. The Tribunal agreed. It also noted at [157] that the applicant had not complied with a specific obligation under the Act to submit an Aged Care Financial Report.
(f) It was claimed by the respondent that the applicant had failed to provide monthly statements to clients. The Tribunal found that monthly statements had been provided, but that they were "not understandable for recipients" and the applicant had therefore breached the User Rights Principles (at [158]). The applicant had also failed to comply with an obligation to provide the Secretary with, or publish, pricing information (at [159]).
(g) The Tribunal described the applicant as having refused to accept responsibility for any shortcomings (at [160]). It made a general finding at [161] that the applicant had failed to meet its financial reporting obligations and to manage funds appropriately.
48 The final set of issues considered by the Tribunal related to s 8-3(1)(e) (compliance by the applicant with its responsibilities as a provider). The applicant was alleged to be "non-compliant under this paragraph" as a consequence of the various matters discussed under the previous paragraphs. The Tribunal addressed certain specific contentions raised by the respondent in addition to that general submission.
(a) It was asserted that the applicant had knowingly failed to meet its responsibilities to ensure that employees had national police checks. This was established in relation to at least one employee (at [169]).
(b) It was alleged that the applicant had continued to enter into home-care agreements with care recipients after the revocation of its approval. The Tribunal noted two cases in which it was satisfied that the applicant had asked care recipients to sign backdated documents after its approval had been revoked. In one case, Ms Wu had threatened an elderly care recipient with court proceedings. The applicant's conduct in this respect was "inappropriate" (at [171]).
(c) A further example of "inappropriate conduct for a service provider" was writing a threatening letter to a care recipient who wished to terminate their agreement with the applicant (at [173]).
49 Under the heading "conclusion", the Tribunal summarised its reasoning as follows.
50 First, despite Ms Wu's considerable experience in providing aged care, the Tribunal concluded that she had demonstrated an inability to accept the requirements which were necessary for a provider under the Act. Until the applicant, through Ms Wu as its executive, acknowledged the necessity to observe and comply rigidly with the requirements (and did so), the applicant was not fit to be a provider (at [174]).
51 Second, the applicant had failed to meet its requirements in respect of more than one regulatory criterion. In particular, it had failed to demonstrate an understanding of its responsibilities as a provider of aged care. This was demonstrated by the applicant's "extensive pattern of non-compliance" (at [177]).
52 The Tribunal thus concluded, at [178], that the applicant failed to satisfy "the requirements under section 8-3(1)(a)-(e) and has ceased to be a person suitable for approval as an aged care provider". Section 10-3 of the Act required revocation of approval in such circumstances; and the decision under review was therefore affirmed.