The federal government’s plan to privatise funding assessments for aged care has sparked concern the new program is designed to manipulate waiting lists and reduce the level of care offered to people in their homes.

The new regime for assessments comes after figures show almost 12,000 older Australians died in a single year before receiving the care for which they were eligible. The assessments are required before any funding is given for nursing and other services in the home.

The federal government’s takeover of Aged Care Assessment Teams (ACATs), currently run by the states and territories, would allow the Commonwealth to rewrite the rules and give it the power to “limit the number of people who can get in”. Essentially, they could distort the numbers by offering lower-level services to take people off the waitlist without giving them adequate care.

Experts have told The Saturday Paper that Commonwealth officials have a fundamental problem with the fact that, until now, states and territories have approved care through ACATs but the federal government has paid for it.

The outsourcing plan is controversial in the sector. The Saturday Paper can confirm it will be the subject of specific hearings before the Royal Commission into Aged Care Quality and Safety delivers its final report in November.

“When ACAT was first set up, the agreement was that they would be run by the states and territories because they were genuinely neutral,” says Kathy Eagar, director of the Australian Health Services Research Institute.

“There is a lot of concern in the industry that this move by the Commonwealth is about limiting the number of people that will be eligible. If they control how high the gate is, they can decide who gets in.”

A senior doctor and member of a current ACAT service told The Saturday Paper the new arrangements are likely to be an “accounting trick” that can “magic the numbers”. The doctor believed the government would put fewer people in the high-care category, changing the numbers without addressing the issue.

“The real problem for the Commonwealth is that they can’t keep up with demand,” the doctor said.

“They have tried and failed, barely making a dent in the numbers. So now the assessment service is going to fundamentally change and I suspect it will make them look better on paper when it does.”

For Professor Eagar, the new arrangements leave her with “no doubt that they want to decide how high the bar is for eligibility”.

The National Prioritisation System – the queue for home-care packages – was introduced by the Coalition in early 2017. Before the end of that year, there were more than 100,000 people waiting on it. The system peaked at almost 130,000 people in March last year, before dipping to 112,000 in September. The figures for the most recent quarter, ending December, have not yet been released by the government.

Despite massive investment in home care, including another $496 million over four years for 10,000 medium-to-high-level packages, announced in late November, the national waiting list has remained stuck, especially at the top end.

Home-care packages are split into four levels with tiered funding. Those on a level 4 package, for example, receive about $50,000 a year in support to remain in their own homes. In theory, investment in home care saves taxpayers’ money by allowing people to live longer in their own homes, reducing the time they would need to spend in nursing homes, which are vastly more expensive.

Royal commissioners have heard testimony that nursing homes can, in some circumstances, hasten death. In human terms, residents go downhill quickly once they’ve crossed that threshold. Level 4 home-care packages are the last form of government support before a nursing home and, as such, they are also the most in demand.

The most recent “Report on Government Services”, released this year by the Productivity Commission, revealed median wait times for these high-level plans have blown out to almost three years. The government maintains the wait is “12-plus months”.

In January, data released by the Department of Health exposed the very real consequences of the severe backlog in home-care packages.

In the previous financial year, 11,987 people died while waiting to receive support at the level for which they were assessed. Some had received interim packages at a lower level but almost half died with no support at all.

For another 18,914 people, their health declined to such a degree that they were taken from the home-care waiting list and admitted to a nursing home.

Last week, Health Minister Greg Hunt rose in parliament to rebuke what he called a “shameful, disgraceful, disgusting and dishonest accusation” that the government’s inability to reduce the waiting list had seen people die without support.

“What I have not had before is a comparison of the figures of the average rate of death for those in the general population who are 75 years and over, and the average rate of death for those who are 75 and over and who are looking for home-care support,” he told the house of representatives on February 11.

“At this point in time, there is a 6 per cent general population loss of life for those 75 and over and 5.2 per cent for those who are actually seeking additional home-care support.”

The Saturday Paper asked Hunt for the source of these figures, but he declined to comment. Aged Care Minister Richard Colbeck disclosed the methodology, confirming they were only for those aged 75 and over in the national queue and compared with those of the same age in the general population. The data, he said, was drawn from the Australian Bureau of Statistics and the Australian Institute of Health and Welfare.

But aged care is for people aged 65 and over. Hunt’s figures, therefore, did not include an entire demographic – an additional 2000 people – who died waiting for home care. When those figures are compiled, the narrative changes significantly.

Using the same source material, the rate of death for Australians aged 65 and over is 3.2 per cent. For those on the home-care waitlist, it’s almost double that, at 6.2 per cent.

“This government recognises the importance of making accurate information available to older Australians and their carers to inform their aged-care choices,” Colbeck says. “The formation of the [National Prioritisation System] has enabled wait times to be publicly available and potential demand to be measured for the first time.”

The minister is quick to reassure people that the proposed changes to the assessment teams “will not inhibit access to aged-care services”.

“The new arrangements will ensure quicker access to aged-care services by removing duplication and inefficiency in the current assessment process,” Colbeck says. “This will be achieved by creating a single assessment workforce that will assess eligibility for access to all aged-care programs.”

Colbeck says the system is not being privatised. However, in some states it will have that effect – with governments choosing not to tender for the services.

The director of aged-care services in Victoria’s Department of Health and Human Services, Jackie Kearney, wrote to teams in her jurisdiction last week to say the Victorian government would not seek contracts under the federal government’s new scheme. Those contracts will be taken by private companies or non-government organisations.

“In this model, the Commonwealth will no longer have agreements solely with the Victorian Department of Health and Human Services for the delivery of state-wide aged care assessment services,” she wrote.

“… States and territories, including Victoria, are continuing to negotiate with the Commonwealth to retain the role of jurisdictions in the delivery of a state-wide streamlined assessment service. However, should the tender proceed as outlined by the Commonwealth, the department will not be tendering to provide assessment services under the new model.”

Labor’s federal spokeswoman on aged care, Julie Collins, told The Saturday Paper “it is shocking that the government would choose to be deceptive about the impact of these waiting times”.

She said the government “must come clean on why it is choosing to outsource work”.

For Professor Eagar, the new arrangements leave her with “no doubt that they want to decide how high the bar is for eligibility”.

Certainly, the federal government is worried about demand. In its submission to the royal commission about the design of a new aged-care system, released on February 13, the Commonwealth argued some matters needed “further consideration”.

It said particular focus needed to be given to “sustainability of the aged-care system, including how demand would be managed in an uncapped system”.

Under the heading of “assessment and managing demand” the Commonwealth noted that the new contracts will “provide the Commonwealth with greater transparency of assessment outcomes”.

The submission said the royal commission’s consultation paper “appears to suggest that the future aged-care system would no longer be capped”.

“However,” the submission continued, “the paper does not discuss in any detail how demand would be managed in an uncapped environment. Demand would need to be managed in order to ensure people receive the services they need and that the aged-care system is sustainable in the longer term ...

“Options for working to manage demand could include rigorous needs assessment … The role of price signals also needs to be considered.”

In 2018, the Department of Health wrote to Aged Care Assessment Teams around the country to “caution” them because they had made more high-priority assessments of people going into home care “than expected”. Despite this, there was no evidence that the assessments themselves were wrong.

Last February, the then secretary of the department, Glenys Beauchamp, told the royal commission it would take 30,000 new high-level home-care packages and “several billion dollars” to reduce the wait times for home-care packages to about three months.

Since that evidence, there were no new packages announced in the budget and only 10,000 in November.

Rather than reducing the number of people waiting for support, the queue is longer now than it was in 2017 when the numbers were first published.

The jewel in the crown of aged care in Australia – allowing people to live at home as they age – will not be a reality for some, even if they qualify.

“I worry policymakers are confusing the real issue here,” the ACAT doctor says. “People will still need help even if they are not showing up on a waiting list.”