The many extracts on these pages are from copyright material. They are owned by the reference given or its owner. They are reproduced here for educational purposes and to stimulate public debate about the provision of health and aged care. I consider this to be "fair use" in the common interest. They should not be reproduced for commercial purposes. The material is selective and I have not included denials and explanations. I am not claiming that the allegations are true. The intention is to show the general thrust of corporate practices as well as the nature and extent of any allegations made. Any comments made are based on the belief that there is some substance at least to so many allegations.

Links to Site Maps

Corporate Practices

to print)

Path to this page

Markets & aging
Nursing homes

Health care

Hospital Corporatisation
Entry to Privatisation
Privatisation Background
Australian states
Pathology & Radiology
Gen. Pract. Corporatisation

Aged Care
Story of corporatisation
 Nonprofit dilemma
Aging bonanza
Nursing homes
Home Care
Breadth health corporat.
Retirement Villages

Nursing Homes
1985 to 1998
1998 to 2001
2002 to 2005
People farming
Residents & Relatives
The Companies
Not for profit homes

Introductory page
This corporate web site addresses the issues of corporate health care within a broad framework. A web page describing this broad context should be considered as an introduction to each page on the web site. If you have not yet read it then
CLICK HERE to open it in another tab or web page.

Content of this page
This web page documents the first series of scandals which exposed the barrenness of the governments policies and the ineptitude of its ministers. Following the crisis created by the Riverside scandal there were ongoing instances where appalling conditions in nursing homes were exposed. None of this had any impact on government policy and they did little more than tinker with the system. The stage was set for continued deterioration and the truly confronting scandal in 2006.

 Australian section   

Bronwyn Bishop and the Riverside Scandal
1998 to 2001  




The system was slowly falling apart

By the second half of 1998 it was already clear that there were serious problems in the more privatised Victorian nursing home marketplace.

When the coalition gained power the under-funded aged care system was in a parlous state. There had been no money to maintain or rebuild and facilities were run down. Staff were overworked and demoralised. Care was suffering.

The government was attempting to use the industry friendly accreditation program to pressure owners to refurbish and improve care. This was remedial rather than punitive and it was only after multiple failures to remediate that sanctions were applied. Not surprisingly there were multiple failures to meet standards and to refurbish or rebuild. The process was not working. Victoria already had the largest number of commercial operators and problems were most acute here. A long list of problem homes had been identified before Bishop became minister.

Aug 1998 Inheriting a list of problem homes

The Federal Government has a secret list of 41 Victorian nursing homes and hostels which it regards as facilities of concern. Today The Age publishes the most recent list which contains the names of 31 homes. The other 10 are unknown.

Facilities of concern are homes that the Department of Health and Family Services believes are in serious breach of basic care standards.

Insight has investigated the 31 homes named on the list, examining the Government's own standards reports and confirmed that significant health, dignity and privacy, food and hygiene and care needs of residents are being flouted.

An attachment to the list says that of the 41 facilities, 13 have been issued with a notice of non-compliance, the final step before sanctions are applied.
"It is outrageous that the minister has not acted immediately. He knows where the homes are but has done nothing. He should get in there and clean this mess up,'' Ms Macklin (labour opposition) said. ``Two things have happened since this Government came to power. They took $479million out of aged care and they changed the rules so homes no longer had to employ qualified nurses. The result is shocking care.''
Princeton Nursing Home, in Bellett Street, Camberwell, had been visited by the Department of Health and Family Services' inspectors on 12 occasions. Financial sanctions were finally imposed on 1 April this year, preventing the home from admitting any new residents, but these expired almost two months ago.
Secret List Of State's Hostels The Age August 26, 1998

In January 1999 I wrote to the minister because of the failure of her department to acknowledge my objection to Sun Healthcare which had indicated its intention to enter the nursing home marketplace in Australia. Its web page indicated that it already owned homes in Australia. I corresponded with her departments. That correspondence is a little prophetic in the light of what happened at Riverside only a few months later and what has happened since.

Click Here to read some of this corrrespondence

to contents

Pressures to corporatise

The government’s accreditation standards required that the aging and chronically under-funded nursing homes upgrade their physical facilities. Most did not have the money to do so and had to choose between closing and selling. Only market listed companies and the banks could easily raise the capital needed.

This gave powerful impetus to the governments policies of consolidating the industry. Over the next few years nursing homes fell into the hands of DCA and the large bankers. Both control and the ethos of the service shifted from a not for profit community focus to the impersonal profit priorities of DCA’s institutional shareholders and the bankers. DCA’s statements to the stock market reflect their position

Feb 1999 The market's view of aged care

Mr David Vaux, Managing Director of DCA said, "The nursing home industry is undergoing significant change. Since the introduction of the 1997 Aged Care Act operators must satisfy stringent Federal Government accreditation standards to maintain current Commonwealth resident subsidies. To qualify for higher funding levels operators must also meet increasingly demanding building improvement benchmarks. Many small operators do not have the management expertise or the capital to achieve those standards and are looking to sell out. DCA expects large scale consolidation of ownership to occur. The opportunity exists to build a substantial business under the control of a proven management team."
The introduction of The Aged Care Act 1997 heralds the beginning of a new era in the Australian residential aged care industry, requiring and rewarding professionalism, accountability, and improved management practices and standards of accommodation. We look forward to meeting the increasing expectations of Australia's rapidly ageing population."
ASX-Development Capital Of Australia Limited (DVC.AX) Recruits Moran Snr Exec. to establish Nursing Home Business. Australian Stock Exchange Company Announcements February 1, 1999

to contents

The Riverside scandal exposes the deficiencies

By 2000 it was clear that the system was not working and that there were homes in Victoria where standards were simply ignored. Providers were given ample warning of inspections so had the opportunity to bring in extra staff and tart up documentation before they were visited by the agency’s assessors. The assessments did not reflect the real situation in nursing homes. Those who failed accreditation were not penalised. Instead the agency went to extreme lengths to accommodate them.

Fiery Bronwyn Bishop had made her mark in opposition and had leadership ambitions. She had moved from the senate to the house of representatives. She became aged care minister at the end of 1998.

The complaints system was not working and no effective action was taken when failures in care were reported. Under pressure Bishop, the new minister, had promised to initiate surprise visits but she had not done so. There was a great deal of unhappiness about what was happening. Bishop had been aggressive in her criticism of others but was inept when given responsibility herself. This was a tough portfolio and she could not handle the pressure.

In January 2000 a number of residents in Riverside sustained chemical burns when given kerosene baths as a cheap alternative to standard treatment of scabies. Nursing staff who had objected to this and refused to comply had lodged a complaint. A month later nothing had been done to find out what had happened. Instead the agency had set about a drawn out regulatory process of mediation with the owners of the home. The press drove the minister to mount the first surprise visit by the agency setting in motion a chain of events.

Mar 2000 Responding to media pressure

And she (Bishop) did not answer why she revealed the kerosene bath incident at the same time her office became aware the Herald Sun was to publish the story the next day.
Bishop dodges blame. Herald-Sun March 7, 2000

Riverside was the first of a succession of scandals. The press used it to expose the flaws in the system and drive the minister to action. What ensued was social drama on a grand scale - a drama in which the failings in the system were laid bare and all those involved suffered. There is a large volume of revealing information which I have covered on the Riverside page.

Click Here to explore the revealing Riverside scandal

Feb 2000 Accreditation agency's track record

The Aged Care Standards and Accreditation Agency had not conducted any unannounced inspections despite 4000 complaints about nursing home conditions over the two years.

It had carried out visits after notice was given on about half of Australia's 3000 nursing homes.

The inaction was despite a pledge in parliament last August by Aged Care Minister Bronwyn Bishop to use all the tools at her disposal - including spot checks - to rid Australia of substandard nursing homes.
Complaints were sat on for a month. Herald-Sun February 25, 2000

Feb 2000 Staffing issues

"Whilst the situation at Riverside is quite tragic ... we're very concerned that what has happened there is really just symptomatic of a system that's really extremely sick and needs some serious attention."
On the nights the kerosene baths were given at Riverside, January 15 and 16, only two registered nurses were on duty and it is believed they refused to carry out the management's request.

Ms Sellers said under regulations, abolished by the Kennett government, six registered nurses would have been on duty.
Nurses complained repeatedly about scabies nursing home. Australian Associated Press February 25, 2000

Feb 2000 Pressure to change system

THE federal Government has come under pressure to overhaul Australia's aged-care system amid allegations that Health Department mismanagement allowed a Melbourne nursing home to operate after staff bathed residents in kerosene and allowed maggots to infest a wound.
Kersosene baths scandal puts heat on aged care. The Australian February 26, 2000

Feb 2000 Complaint system in disarray

Victorian Health Services Commissioner Beth Wilson said the case highlighted a complaint system in disarray. Her office had lost power to investigate complaints against nursing homes in 1995.
Kersosene baths scandal puts heat on aged care. The Australian February 26, 2000

Feb 2000 Nursing unions press for changes

The Australian Nursing Federation federal office said aged care laws were in need of major surgery and called for an immediate Senate inquiry into the (Riverside kerosene baths) incident. ANF federal secretary Jill Iliffe said accountability for conditions had been seriously compromised when the new laws downgraded the role of registered and enrolled nurses who work in nursing homes. "On the basis of removing business red tape, the Federal Government has put elderly Australians at risk," she said.
Bishop silent on delay over aged-care scandal Courier Mail February 26, 2000

Feb 2000 Minister out of touch with what is happening

All the while the Minister responsible, Bishop, has trumpeted the triumph of the Government's aged care reforms and the move to better standards in homes. A part of this better standard is a policy of not imposing on nursing homes by paying unannounced inspection visits.
Bishop told Parliament at the time that surprise visits - or spot checks - were a necessary part of the armoury available to ensure the health and safety of our frail and aged nursing home residents. Despite this pledge, News Limited revealed last week that for the past two years the agency had not carried out a single surprise visit.

Bishop responded by backing away from her August pledge and said instead that spot checks were an action of "last resort".
Even Dickens would be appalled. Courier Mail February 26, 2000

Feb 2000 The minister's failures

As the official protector of the nation's most vulnerable, Bronwyn Bishop failed to fulfil her duty.

She must resign.

By quitting she would acknowledge her role in the worst kind of government cover-up.

Mrs Bishop sat on the news for nine days, making a public announcement to ABC radio late on Thursday, only after first refusing to answer questions put to her by the Herald Sun.

Her actions denied relatives the chance to exercise their duty of care and move loved ones elsewhere.
The tragic irony of this terrible affair is that on the very same day that Mrs Bishop ordered her officers to check what was happening at the home, she had told reporters that spot checks of homes by department officers were a last resort measure.
EDITORIAL Herald-Sun February 26, 2000

Feb 2000 The minister's crumbling career

She had already made herself a name for aggression by monstering public servants, most notably former taxation commissioner Trevor Boucher, at public committee hearings.

A shift to the House of Representatives beckoned and Mrs Bishop was touted as a future PM - not least by herself.

Since making it to the Lower House and subsequently to government, Mrs Bishop has been a spectacular non-event.
Bishop flame sputters. Herald-Sun February 28, 2000

Feb 2000 Complaining to the UN

AGED Care Minister Bronwyn Bishop was last night accused of placing nursing home residents at unnecessary risk by refusing to release the names of the country's 18 worst nursing homes.
Pensioners and Superannuants Action Group spokesman Ted Quinlan said the group had written to the UN providing examples of neglect and overcharging in nursing homes.

"If you go into some of these nursing homes the stench where they're lying in their own body waste is appalling," he told the ABC.

"Some of the people are just left there without drinking fluids, their food is put in front of them. They wouldn't know what day it was," he said.
Bishop sits on list of bad homes The Australian February 29, 2000

to contents

The "Andrew Turner" reforms

If the comment about Mrs Bishop in the letter below is true then it goes to the heart of the government’s problems and to their lack of insight into the real world of nursing homes. This was the sales pitch of the notorious cost cutting Andrew Turner and the company he founded and we know that he had a big influence on Wooldridge and his colleagues in 1997/8.

By 2000 costs were increasing and waiting lists were longer, much of it a consequence of government policy.

Feb 2000 Care calls for middleaged women with kind hearts

Mrs Bishop is on record as stating that she believes that registered nurses are unnecessary in nursing homes and all that is needed is "middle-aged women with kind hearts".

As a registered nurse with 20 years experience in aged care, I beg to differ.

This government has a deliberate policy to remove registered nurses from nursing homes and to this end has: CUT funding to aged care by millions of dollars REMOVED the nurse-patient ratio, which guaranteed a proportion of staff had to be registered BLOCKED pay rises to registered nurses, causing a mass exodus of trained staff INTRODUCED policies that see one third of our workload is now paperwork. This is necessary to get funding from the government.

Staff cuts and increased workloads are now the norm in aged care.
LETTER - Heat on Bishop over kerosene incident Herald-Sun February 29, 2000

Mar 2000 Another reference to Bishops views

In an interview in the Australian Nursing Homes and Extended Care Association's monthly newsletter last March, Bishop was quoted as saying the only standard of training required in a nursing home was "middle-aged women providing tender, loving care". Such a response gives little comfort to those who fear the dark history of the aged care industry in the 1980s - with all its rorting, fraud and neglect - is set to repeat itself.
Crimes of neglect. The Australian March 4, 2000

to contents

Ongoing criticism

Following the Riverside scandal there was intense media scrutiny of the aged care system, of nursing home care, of departmental failure and of the ministers performance. Some extracts follow.

Feb 2000 Many warnings that system flawed

BETH WILSON, VIC HEALTH CARE COMPLAINTS COMMISSION.: We now are seeing facilities cutting corners to save money, bringing in more untrained staff and not having trained nursing staff available.

That worries me.

MARK BANNERMAN: They are frail, alone and now, it seems, many of them are at risk.

For 12 months now, insiders have warned the Federal Government's policy on aged care is seriously flawed.
MARK BANNERMAN: Even as an isolated case, the story in Melbourne would be a shocking one, but there is now growing evidence it is not isolated.

Indeed, there is evidence arising that many people who are unqualified and who are working in nursing hostels are repeatedly being asked to do jobs they are simply not qualified to undertake.

SANDRA MOAIT, NSW NURSES ASSOCIATION: One very practical example is that unlicensed workers are giving medications, giving schedule four drugs, schedule eight drugs, such things as insulin, without what we believe as appropriate supervision.
MARK BANNERMAN: - - - But the Government did not, and does not, specify the number of qualified staff needed to provide care, and that, according to some, is a dangerous loophole.
Outrage over nursing home treatment ABC - 7.30 Report February 25, 2000

Mar 2000 Waiting longer and costing more

A BILLION-dollar blowout in spending on aged care has occurred while waiting times for entry to homes has increased 50 per cent. The 42 per cent increase in spending has underlined the failure of controversial reforms three years ago which saw the introduction of an unpopular $4380 entry fee.

And it increases pressure on Aged Care Minister Bronwyn Bishop as she battles claims her department has been slow to clamp down on negligence in nursing homes.
When the Howard Government introduced controversial nursing home reforms in 1997 it claimed the move would save the budget $500 million and improve care by forcing wealthier residents to pay an entry fee.

Three years later spending on nursing homes has leapt from $2.5 billion to $3.5 billion.
Budget blowout as aged care list grows. Daily Telegraph March 1, 2000

Mar 2000 Criticisms of the system

The system is supported by the operators of most nursing homes who believe it will lead to continuous improvement, and drive out the unscrupulous. But it represents a significant victory for the industry which has gained new freedoms to spend Federal funds as it sees fit.

The Riverside scandal highlights serious weaknesses in the new system. If homes are not at their best now, when would they ever meet good standards, and what will happen to residents between accreditation visits?
But Francis Sullivan, the executive director of Catholic Health Australia, a major charitable provider of nursing homes, says Government funding is inadequate, incorrectly indexed, and has not kept pace with costs such as the 15 per cent salary increases for nurses and burgeoning workers' compensation premiums.

"If there are proprietors with a propensity to cut corners, the underfunding of the system will only exacerbate problems,'' he says. He admits that proprietors are much less accountable now for the funds they do get, and that this is undesirable, and undermines arguments for increased allocations.
But the credibility test for the new system will be how many nursing homes fail accreditation or get a mere one-year rating. And will the Government have the stomach to close down the non-performers when residents will have nowhere else to go?
Golden Oldies Sydney Morning Herald March 2, 2000

Mar 2000 Shifting the blame for criticised system

For Bishop's defence has consisted largely of blaming the bureaucrats she is supposed to control.

The recent history of the administration of aged care it has burnt out two previous ministers and been the subject of a damning auditor-general's report in the past three years shows it to be a very tough bureaucratic nut to crack.
One adviser's position is still vacant, and has been since Learmonth's departure. Bishop has been trying to fill it from the department, but is having trouble finding people willing to work with her. Even her press secretary, the affable John Wilson, has been sidelined in the current crisis, replaced by (you guessed it) someone from the department.
The Nutcracker Is Being Squeezed By Mandarins Sydney Morning Herald March 7, 2000

Mar 2000 Department staff reduced and agency underresourced

The Government has reduced the number of staff in its Aged and Community Care Department, which handles complaints, and under-resourced its new aged care standards and accreditation agency, which carries out inspections. At the same time, it has given proprietors the kind of freedom to spend taxpayers' money they have dreamed about for more than a decade.
No Guarantee This Horror Home A Freak Sydney Morning Herald March 7, 2000

Mar 2000 Failure of the new system

The litany of horrors in the official report on the Riverside Nursing Home seems almost beyond belief. It is evidence of the failure or at least the deep flaws in the Federal Government's new system for monitoring the nation's 3,000 nursing homes.

The situation of appalling patient care and rundown facilities was exactly what the Government's aged care reform package introduced in late 1997 was supposed to address.
Aged Care Row Spurs WA Check The West Australian March 7, 2000

Mar 2000 Government policies a problem - minister ignorant

Aged care has been a problematic area for the Australian Government since it came to power, with the current Aged Care Minister Bronwyn Bishop now likely to lose her job over the issue. However the Government's own policies have aggravated the problem, with the most weak and vulnerable in society, who are unable to engage in "reciprocal obligation", at grave risk.

Unfortunately Bishop appears to have mismanaged her whole portfolio, with the spot checks so crucial to monitoring the newly self-regulated environment never actually begun. Bishop appears to have been completely ignorant of the demands of her job, which has resulted in a knee-jerk response.
Editorial. Mercy is dashed in Bishop panic The Canberra Times March 8, 2000 (ABIX ABSTRACT)

to contents

Issues in the community

An article in the Australian broadens the issues to look at community attitudes to aged care. What this paper, a mouthpiece for the right fails to do is to relate this to our changing world view and our failure to embrace responsible democracy as a distinct idea separate from capitalism and economic freedom.

Mar 2000 Community responsible too

Bishop has learned, if she had not realised it before, that the portfolio of aged care is a poisoned chalice. It carries with it administrative complexity, a history of underfunding and, thanks to an ageing population, pressure to undertake wholesale reform.

But, more important, aged care stirs the emotions like no other issue. This is partly because it thrusts up unpalatable realities such as death and physical disintegration, and partly because we have conflicting views about where the balance of responsibility for the care of the elderly should properly lie.

Are we so intent on blaming bureaucrats that we fail to look at our own actions? We call for greater government spending on nursing homes, yet we complain about insufficient personal tax cuts. We get outraged about the lack of visits to nursing homes by authorities, but how many of us visit them?
We all must nurse some responsibility The Australian March 10, 2000

to contents

Informed opinion

People, who had studied and worked in aged care, knew what the problems were and what needed to be done. The government were at loggerheads with the medical profession on many other issues and were not going to listen.

IT'S happened again. Another scandal, another minister reacting under pressure. It's hardly a surprise. Headlines about maltreatment of nursing home residents recur regularly every two or three years. And as usual, predictably Band-Aid solutions follow.
Nursing homes and hostels have changed over the past 20 years. Gone are frail senior citizens genteelly retiring to a nursing home to be looked after in their twilight years. People now must have significant levels of disability, infirmity and dependence to gain entry. Most residents need help with complex medications, bathing and dressing. Many need to be toileted and even fed. Behavioural disturbances, clinical depression, delusions and/or hallucinations occur in more than 90 per cent of residents with dementia. Nursing home admissions frequently come directly from hospital, discharged early despite still being sick and disoriented.

And who looks after these people who are increasingly sicker and more difficult to care for? A few committed registered nurses plus strong, good-hearted nursing and personal-care assistants who have had minimal or no training. The work is hard and relentless. The vast majority of workers are to be admired, but are forced to cope with insufficient resources. It is inevitable that problems occur.
But we can afford aged care. Look at Germany, Holland or Britain, with much older populations. They have had their demographic transition. Government policy is to move more to user-pays entrance fees, daily fees but the majority of older Australians are on pensions and receive concessional rates for their care (paying a minimum of 87 per cent of their pensions in weekly fees). Some industrialised countries have introduced compulsory long-term insurance for residential care (eg, Japan), while others fund aged care and the pension from a more balanced taxation system. The debate in Australia has not progressed beyond superannuation.

Training for staff is essential. Staff turnover is high. Basic medical, dementia and nursing knowledge of unqualified workers is low. Continuing training is a key to good care. Previous initiatives included the training guarantee levy, and the Residential Care Training Initiative, which has received no government funding since the new act in 1997. A concerted, continuing, compulsory education program is required.

There is also matching the funding of care hours to residents' needs. Proprietors now have full autonomy as to how funding is allocated. Neither nursing homes nor hostels are required to provide a specified quantity of qualified staff relating to the assessed care needs of residents. In response, we propose that the Government prescribe funding for nursing/personal care hours according to a formula that directly links the residents' assessed needs to nursing/personal care hours. Adequate staffing ratios must be established and monitored.
Residents, their families, industry, service providers, health professionals and government should now sit down together to plan for the coming years and work on ways to advance our care of older people. After all, how civilised a society is can be judged by how it looks after its most vulnerable citizens.
The Aged Need More Care Sydney Morning Herald March 10, 2000 BY Professor Henry Brodaty who is Professor of Psychogeriatrics At The University of NSW. Lewis Kaplan is chief executive of the Alzheimer's association NSW.

Mar 2000 Contributing to patient deaths

Four separate coroners reports blamed nursing homes for deaths in Victoria in March 2000. Reports obtained by the "Herald Sun" disclosed improper staff training, inadequate medical procedures and poor handling of patients by staff were among some of the contributing factors to patient deaths.
Coroners say home to blame Herald Sun March 16, 2000 (ABIX ABSTRACT)

to contents

Ideology triumphant

The Riverside scandal did nothing to change the governments agenda for aged care. It elected to fund the less crumbly in hostels at the expense of the truly frail who needed high care in nursing homes. Instead of tacking the problems in the system it elected to prop up the accreditation process by giving it more money.

Apr 2000 Long waiting lists and skewed funding

Catholic Health Australia executive director Francis Sullivan said he was surprised at the small allocation in the light of the growing pressure on public hospitals forced to house the ill elderly as they waited for a nursing home place. And 18 percent of low care nursing home beds, formerly hostels, are taken up by elderly classified as needing high care.

"The trend is for people going into nursing homes frailer and sicker but this allocation is biased towards low, rather than high, care," Mr Sullivan said. "These allocations don't accurately reflect the increasing dependency trend."

Aged and Community Services Australia chief executive officer Maureen Lyster said the small number was a continuing trend. Ms Lyster said nursing homes with predominantly high-care beds were at 99 percent occupancy and people in some areas of Australia were forced to wait a year for a place.
'Pitiful' aged care package provides 300 beds. Courier Mail April 7, 2000

Mat 2000 Talk of more home care

The federal government was responding to the greying of the baby boomer generation by making it possible for them to grow old in their own homes, Aged Care Minister Bronwyn Bishop said today.

The move towards more home-based care for the elderly follows a series of damaging revelations about abuses within the nursing home industry.
Govt to provide more home care for greying boomers Australian Associated Press May 4, 2000

May 2000 Beefing up complaint handling

THE Federal Government has earmarked $11.7million to form rapid response groups to monitor complaints against nursing homes.

Aged Care Minister Bronwyn Bishop said the money would go to the Aged Care Standards and Accreditation Agency and to the Health Department to expand the capacity to investigate
Closer Eye On Nursing Homes Newcastle Herald May 10, 2000

May 2000 Need a better way

"There is clearly something wrong with a system which has caused so much distress to residents and cost the taxpayer hundreds of thousands of dollars,'' Labor Senator Chris Evans said last night.

"There must be a better way of dealing with sub-standard care in nursing homes.''
Suspicious Deaths, Stalkers Add To Nursing Home Saga Australian Financial Review May 24, 2000

to contents

Criminals and nursing homes

Hard on the heals of the Riverside scandal came allegations of poor care in the Alchera home in Queensland. Then another scandal involving the Kenilworth and Belvedere Park nursing homes (see Saitta and Neviskia web page). Both were run by a man with a criminal conviction. This was an ongoing saga of failures in care, failures to act and failures to debar the owner. More embarrassing still decisions to close the Kenilworth home and penalise Belvedere Park were shown to be vulnerable to legal challenge.

The government was forced to enact legislation so that convicted criminals could not be directors of nursing home companies. This did not bar them from ownership, economic control and the appointment of directors of their choice. This was consequently toothless and ineffective. These scandals are dealt with on the Saitta and Neviskia web page and on the Peninsula Care page.

May 2000 The problem with criminals

Ms Hefford said care providers convicted of an indictable offence were not automatically stripped of their licence but overall conduct was taken into account.

Opposition aged care spokesman Senator Chris Evans has called on Aged Care Minister Bronwyn Bishop to conduct a full inquiry into Mr Menere and other people with alleged criminal convictions involved in the management of Victorian homes.

"It's a scandal this bloke has been able to continue to operate a nursing home if these allegations are true," Senator Evans said.

He claimed there was evidence of providers convicted of defrauding the Commonwealth continuing to be involved in the management of homes.
Owner under investigation. Herald-Sun May 27, 2000

Sep 2000 Laws changed

LAWS removing "unfit" nursing home operators without forcing homes to close were unveiled yesterday.

The Federal Government will be able to fine nursing homes up to $33,000 a day for having a disqualified person as one of the operators or "key personnel".

Individuals could also face up to two years' jail for failing to declare they are a disqualified person who is either a bankrupt, has a conviction or is of "unsound mind".

Aged Care Minister Bronwyn Bishop introduced the amendments into Parliament saying they would improve the protection of the health and safety of nursing home residents.
The amendments allow the department to defer sanctions against a home, allowing residents and relatives to be notified, and to revoke individual bed licences as they become vacant.
New laws to remove `unfit' nursing home staff Adelaide Advertiser September 8, 2000

to contents

Allocation of nursing home beds

Government policy making was dominated by economists. Aged care had major economic implications and decisions about the number of aged care beds were based on economic considerations rather than the needs of the community. The public had different priorities. Even when new beds were allocated operators did not build them and the government did not force them to do so.

Jun 2000 Bed shortage and costing for more beds

Reports in The Advertiser this week highlight the continuing shortage of aged-care beds across the state, a situation complicated by restricted bed licences and funding, changing regional demographics, our growing longevity, disputes between the State and Federal Governments and government budget-based initiatives to keep aged people in their own homes longer and push aged care services into the community.
A woman now aged 65 faces a 37 per cent probability of entering a nursing home some time before death. Men of the same age face a 24 per cent probability.

By age 90, the probability for women rises to 95 per cent; for men, who are more likely to be cared for at home by a spouse, it is 60 per cent at age 95.

A crisis of accommodation is also being predicted for dementia sufferers, who need special equipment and greater one-to-one attention than other frail elderly.
Bed licences are restricted, according to Viv Padman, president of the Australian Nursing Homes and Extended Care Association of SA, because of the cost of funding beds.

"The Federal Government is worried that if it supplies, for sake of argument, another 100 beds in Adelaide it will cost the Government say $35,000 per bed a year," Mr Padman says.

"Every time we admit a new nursing home resident, the Government supplies a subsidy worth between $30,000 and $35,000 a year and if the number of licences available is increased, the cost will blow out."
Nowhere to go Adelaide Advertiser June 17, 2000

Jul 2000 Aged care a big issue for community

AGED care is set to become a key election issue after a survey found 84 percent of people believe the Federal Government mishandled the kerosene baths scandal. And more than 73 percent do not believe the Government is doing a good job on aged care. They ranked aged care ahead of unemployment, the economy, illegal drugs and children's services as an issue of significance. The survey found a majority believed aged care would have an important influence on their vote in the next federal election, due next year.
Surprisingly, nearly 82 percent believed aged care funding should be increased even if it meant raising taxes or cutting other government services
Aged care emerges as federal poll issue Courier Mail July 17, 2000

Apr 2001 Phantom beds - licenses but homes not built as no money

FRAIL and elderly South Australians are waiting for nursing home places while 903 bed licences in the state remain non-operational, new Department of Aged Care figures have revealed.

The "phantom beds" - licences announced by federal Aged Care Minister Bronwyn Bishop over the past two years - are still not being used despite long waiting lists.

Owners say planning, building and the high cost of constructing new facilities is responsible for the delay in translating the licences to real places in nursing homes.
"The reality is, until the Howard Government introduces a capital-costs funding program, these phantom beds are not going to be built," Catholic Healthcare Australia executive director Francis Sullivan said yesterday.
Cold comfort in 'phantom beds'. Adelaide Advertiser April 18, 2001

Jul 2001 More bed licenses offered but no money to build

AGED-CARE providers in SA will be able to bid from today for 502 new nursing home beds.

The Federal Government's latest allocation also offers 134 community aged-care packages for this state - 2200 nationally - which are aimed at keeping the elderly in their own homes longer.
Providers have up to two years before the new beds must be operational but some have expressed a reluctance to bid while funding is still a problem.

New South Wales has been allocated 1761 beds, Victoria 1394, Queensland 1030, Western Australia 672, Tasmania 123 and the Northern Territory 60.
More beds for aged. Adelaide Advertiser July 21, 2001

Jul 2002 Homes not making money

Full-year reports splashed in red ink will further dampen the sector but analysts say an increased need for aged care will inject life back into some companies.
Sector sinks to two-year low but good news for aged care companies Crises cripple health stocks. Sunday Times (Perth) July 14. 2002

to contents

Failure to meet deadlines

January 2001 had been set as the cut off point by which nursing homes were required to meet physical and other accreditation standards if they were to continue operating. Closing so many homes was clearly not an option and they were given extensions.

Jan 2001 Not tough enough

Senator Evans said the Government was not being tough enough on Australia's nursing homes.

"They've had three years to meet the January 1 deadline. They've got 21 homes that failed to make it, and 20 were given exemptions," Senator Evans told ABC Radio.
$50m to stop rot in homes for aged. The Australian January 3, 2001

One of the big problems has been that government has pressured companies to refurbish and rebuild without providing the funding which would enable them to do so and generate returns on the investment. This created the ludicrous situation of Doug Moran, one of Australia’s wealthiest men putting out his hand - and of the Catholic community supporting him.

Jan 2001 Granting licenses but licensee must fund building

Sullivan (Catholic community): The point is the government has already recognised there needs to be residential aged beds in Darwin and other remote areas. What the government refuses to recognise is the cost of building those beds. Let's remember this. When the government came in and made their changes to residential aged care, it put a fee on residents of four thousand three hundred and eighty dollars a year. Now, that fee only equates to what it takes to maintain those facilities, not rebuild them or build new facilities.

Reporter: But the government is keeping the chequebook firmly shut. Aged Care Minister Bronwyn Bishop maintains that the Moran Group has the resources to build a nursing home facility in Darwin.
Interview on The World Today Program, ABC Sydney - The Moran Health Group January 25, 2001

By 2001 the governments policy of promoting for profit corporations over charitable institutions was altering the face of aged care.

Mar 2001 Government policy driving shift to corporatisation

The Howard Government has overseen a major shift to private ownership of NSW's nursing homes, and the Liberal Party stalwart Mr Doug Moran is a multi-million-dollar winner from the move.

Estimates are that the Moran Health Care Group has won bed licences worth almost $10 million in the past two years. The beds make up about 12 per cent of Australia's new nursing home places well above the Moran Group's 3.5 per cent share of the national nursing home market.

The director of the Catholic Health Care Association, Mr Francis Sullivan, yesterday questioned the shift towards private sector homes in the latest allocation of beds.

"This is a very worrying trend. It is a significant shift by the Government that for-profit aged care should be promoted and a clear signal to the charitable sector of the community.

"It comes on top of other policy decisions which make impositions on the church and charitable sector, including the GST and [fringe benefits tax] changes.

"It would appear to run counter to the general themes of a social coalition espoused by the Prime Minister.''

Mr Moran's good fortune is part of a shift that the Government acknowledges resulted last year in 67 per cent of new nursing home beds in NSW going to the private sector, which traditionally has had little more than 31 per cent of beds in the State, where the Moran group has just 3 per cent of the market.

Nationally, 55 per cent of licences in last year's allocation went to the private sector, which has traditionally had only 27 per cent of the market.
Mr Moran has been at the centre of controversy over the Coalition's nursing home policy in the past after a long history of lobbying for a user-pays system and has also acknowledged that he has been a generous donor to individual Liberal politicians.
Moran The Big Winner As Aged Care Goes Private Sydney Morning Herald March 16, 2001

to contents

Government policy distorts services

Another consequence was the skewing of services away from those who needed most care. Large bonds were paid by residents for hostel accommodation but not for high care. These were the only source of capital for the not for profit sector. To meet the refurbishing required by government, providers were forced to concentrate on hostel care at the expense of high care.

The homes forced to close by the new deadlines were in the poorer regions where there was a greater need and insufficient money to rebuild.

Jan 2001 Driving some homes out of the market

The closure of nursing homes as a result of the Federal Government's crackdown on substandard care would hit poor areas of Australia hardest, two church groups warned yesterday.

Catholic and Uniting Church aged care executives said the Government's disclosure that 190 nursing homes had closed or changed hands was likely to accentuate the drift of nursing homes from poorer and regional areas to better-off city locations.
Mrs Bishop said that while the 190 facilities had been sold, closed or had their Government-funded beds transferred, it was "a really very good outcome for residents'' because those homes not prepared to improve standards had seen "the writing on the wall''.

But the executive director of the Uniting Care Ageing and Disability Service, Mr Les MacDonald, said that while some nursing homes would be rebuilt, particularly in high-income localities, "low-income areas and the bush will simply not be able to find the funds to do so''.
Mrs Bishop said the closure or transfer of beds had indicated the poorer operators had been forced out of the industry. Mr MacDonald said that while this was long overdue, it had major implications.

"Until these issues of inadequate bed numbers and capital funding have been dealt with by the Commonwealth Government, older Australians will experience, in increasing numbers, the frustration and loss of dignity associated with a failure to find proper accommodation and care at a very vulnerable period of their lives.''
The Poor Will Suffer: Church Fears On Aged Home Closures Sydney Morning Herald January 3, 2001

Apr 2001 Not for profit church group closing homes. Moran refuses licenses

NSW's biggest aged care group says it is closing nursing home beds because of inadequate government funding, raising questions about the Howard Government's claims it is increasing bed numbers.

Uniting Care NSW says it is converting high-cost nursing home beds into lower-cost hostel beds to access accommodation bonds to pay for the construction or reconstruction of facilities.

The move comes after the Moran Health Care Group handed back 250 of its high-cost bed allocations, because it said Government subsidies were not enough to make the beds viable.

Accommodation bonds are payable only on hostel beds, not nursing home beds used for the severely incapacitated and frail.

The Uniting Care claim comes a day after the Minister for Aged Care, Mrs Bishop, said the Government would fund a record number of high-care beds.

The Opposition greeted Mrs Bishop's announcement with scepticism, arguing that 15,600 of the new beds announced under the Howard Government had never been opened.

Uniting Care NSW's executive director of aged and disability services, Mr Les MacDonald, yesterday agreed with the Opposition:
"We are approving the construction of `aging in place' facilities, where the bulk, or all, of the people admitted will be low care. This will enable us to get access to accommodation bonds to pay for the construction ...

"We are opposed to this for ethical and other reasons but we have no choice ...

"The church in NSW has not taken a policy decision not to rebuild or build [high-care] nursing homes but we have taken the decision that we will not approve clearly unviable capital works proposals. The net effect is exactly the same.''
Aged Care Group Cites Poor Funding As It Closes Beds Sydney Morning Herald April 5, 2001

to contents

Political interference and the minister’s friend

The minister was soon in trouble again with renewed calls on the prime minister to sack her. The scandal this time related to the failure of the agency to act against two poorly performing homes operated by her friend and liberal party donor Millie Phillips. This scandal is addressed on the Milstern web page. The international press took up the issue of her control of the supposedly independent agency..

Jun 2001 Political interference in the agency

The former head of the national nursing home watchdog, Penny Flett, claimed public confidence had been "shattered" in the Aged Care Standard Accreditation Agency because it was unable to do its job independently of government.

"The minister's style is very controlling," Dr Flett said in Perth. "She certainly doesn't step outside the rules and regulations, but the agency is not free to decide how it is going to do things."

Dr Flett's comments came as aged care groups demanded an inquiry into the agency over concerns of political interference.
Crisis puts PM under pressure to sack Bishop. Australian June 22, 2001

Jun 2001 Acreditation agency an arm of the minister's department

Seven months after the horrifying Kenilworth nursing home scandal, the Minister for Aged Care, Senator Bronwyn Bishop, finds herself once again plunged into controversy. This time it's over the reappointment of her Liberal Party campaign director, John Lang, to a position on the influential Aged Care Standards and Accreditation Agency (ACSAA). The Agency is responsible for authorising the accreditation of nursing homes. Failure to gain accreditation may result in the loss of millions of dollars of Federal funding.
But the criticism of Mr Lang's appointment accompanied revelations that a Sydney nursing home had escaped imposition of sanctions by the ACSAA, despite the highly controversial deaths of two patients.
However, ACSAA assessors are said to have told the staff of one of the homes that "the owner knows people, nothing will be done". Both homes were subsequently given generous reprieves of several months to achieve accreditation standard.
But not everyone agrees with the Minister. The director of the Australian Nursing Homes and Extended Care Association, Mr Rod Young, last week expressed concern about political and bureaucratic influence within the ACSAA.

He pointed out that the ACSAA was originally intended to act as an independent body charged with achieving the highest possible standards in aged care, but is now effectively functioning as an arm of Senator Bishop's Department.
Aged care scandals erupt again The Guardian June 27, 2001




to contents

More failures during 2001

Further problem homes dogged the minister in 2001. These included tardiness in responding to allegations of awful conditions in the Sir Thomas Mitchell Nursing Home, the Albury and District Private Nursing Home, both in NSW, and the Templestowe Private Nursing Home in Victoria. These are described on the linked pages.

In November 2000 the nursing unions used the debacle at Kenilworth nursing home to call for legislation to protect residents. The calls for change and for Bishop’s resignation kept coming.

Nov 2000 Calling for changes because of Kenilworth Nursing Home

ANF (Vic Branch) Assistant Secretary, Ms Hannah Sellers, has accused the Federal Minister for Aged Care, The Hon Bronwyn Bishop, of failing to fulfil her duty to protect the residents of Kenilworth Nursing Home and has called on the Federal Government to amend its aged care legislation so that residents can receive proper protection.

The ANF is calling on the Minister to change the legislation so it is able to revoke the proprietor’s approved provider status immediately and to appoint an administrator and a nurse consultant to bring the nursing home up to standard.
"As the situation stands at the moment, the Commonwealth is leaving residents at Kenilworth in a substandard facility without any protection or where there is no compulsion on the proprietor to bring it up to standard. This just isn’t good enough."
Aged care legislation must change to fix substandard nursing homes like Kenilworth Media release ANF November 10, 2000

Jul 2001 Pensioners and Superanuation Assoc. calls for a Royal Commission

In a letter to Mrs Bishop, the Combined Pensioners and Superannuants Association of NSW which has called for a royal commission into aged care demanded to know why she had not appointed an administrator to the Albury and District Private Nursing Home.
The Pensioners' Association is demanding to know why no action has been taken against the home and why the minister has not called for police intervention in the wake of ``talk of unnecessary invasive medical procedures''.
"Why have you failed in your duty by failing to appoint an administrator in this home, even though this is now allowed under the Aged Care Act?

"There is a crisis of confidence in the Government's handling of nursing homes which appears to reward bad homes.
Pensioners Mount Attack On Bishop Sydney Morning Herald July 6, 2001

Aug 2001 Failures at Templestowe igmored

"Bronwyn Bishop has completely failed to protect the residents of Templestowe," he said. "For six months she knew residents were suffering but did nothing to ensure they were properly cared for.

"The shocking and repeated breaches of care residents suffered are totally unacceptable to the Australian community."
BISHOP UNDER FIRE AGAIN Nursing home disgrace Adelaide Advertiser August 10, 2001

to contents

More and more criticism

By the second half of 2001 the failure of the system was clear and articles in international medical journals expressed this clearly. Sadly none are as deaf as those who don’t want to hear. Policy remained unchanged. The sort of people who really cared for the elderly were being driven out and replaced by commercial enterprises. There was a severe shortage of places and the frail elderly were blocking hospital beds. There was also a good deal of soul searching about the aged care system but ideologists were not listening. Labours policy to fix the problems won extensive support but the election was not fought on this issue and the coalition retained power. Bronwyn Bishop lost the aged care portfolio after the election. Julie Bishop (not a relative) took on the portfolio.

Aug 2001 System in tatters

Prime Minister Howard's aspirations for trimming the welfare state and deregulating a private market are now in tatters. The government has been forced to backtrack by public opposition to means testing and paying fees in advance.

Commonwealth funding for nursing homes increased by $A1.4bn (£505m; $715m) to $3.9bn between 1996 and 2000. The accreditation regime is still in place (now known as the Aged Care Standards and Accreditation Agency), but the government has been forced to double the amount initially allocated to support it, eliminating nearly all the savings made from abolishing the inspectorate.
The challenge of regulating care for older people in Australia by John Braithwaite BMJ 2001;323:443-6 ---- 25 AUGUST 2001

Aug 2001 Insufficient money to provide care

Thousands of hospitalised people are queuing for beds nursing homes can't provide, writes Richard Yallop

AT opposite ends of the nursing home industry are Sabine Phillips, 44, who has sold her 30-bed nursing home in Melbourne's outer east because it lost $60,000 in the past two years, and Vincent Marino, 75, who has been lying in Melbourne's Western General Hospital for eight weeks because no nursing home bed can be found for him.
In Melbourne there are 549 aged patients in Marino's position. They are occupying beds in the acute wards of public hospitals because there are no nursing home beds for them. Nationally, more than 2000 aged people are estimated to be living in such conditions. But that is only in the public hospitals. It does not include all the people, some still at home, looking for nursing homes.

Yet while demand has never been greater, nursing home operators such as Phillips - commended for the way she ran her home in the recent commonwealth accreditation process - are leaving because they say running "high-care" homes, where residents are most dependent, is no longer economically viable.

"I did the right thing for the residents and the staff and it wasn't viable," says Phillips, who had a $400,000 overdraft when she sold the facility. "The only way to do it was to compromise care. Perhaps I shouldn't have been educating my staff, or giving the residents seafood cocktails at Christmas, or taking them on bus trips. But I thought that was the ethical, moral thing to do."
She could not achieve the necessary economies of scale in her 30-bed home. The industry calculates that future viability lies in bigger homes with 60 or 90 beds. Smaller, independent homes are likely to close, with large operators such as Prime Life and the Moran Group taking their place.

Phillips says: "It's true, as [Aged Care Minister] Bronwyn Bishop says, that the carpet is being lifted. But our funding now does not recognise higher demands for care and greater bureaucratic demands."

The industry also faces new investment costs to meet construction requirements by 2008 aimed at improving safety and privacy for residents.
The operators of high-care nursing homes say they have been starved of capital ever since the Coalition did a backflip on its 1997 move to charge an accommodation bond to residents.
But Catholic Health Australia chief executive Francis Sullivan says: "It doesn't meet the level of need and frailty. Everyone knows the system needs more money. There's the political question of who will pay - the user or the government - and neither party wants the debate. The danger is, it becomes an economic debate when it should be a moral debate about the dignity of aged people."
But beyond problems of funding and bureaucracy, there is general agreement within the sector that government alone cannot fix nursing homes: there needs to be a change in community attitudes about aged care. It has to come out of the ghetto and leave behind the feeling that it is a dirty business looked after by someone else.
Bedridden old lost in care limbo The Australian August 27, 2001

Ovt 2001 AMA predicts more homes will close

THE HOMES:- UP to a quarter of Victoria's nursing homes could go to the wall in the next two years, according to the Australian Medical Association.

The chairman of the AMA's aged care committee, Dr Gerald Segal, said the homes would be forced to close because funding had not kept pace with spiralling costs.
VAHEC (Victorian Association of Health and Aged Care) chief executive Mary Barry said costs for Victorian homes were up 11 per cent and nurses' wages were rising by 15 per cent in the next three years.

"Something has got to give and what will suffer is the quality of care," Ms Barry said.

The Howard government was expected to promise a $430m boost for nursing home funding today, but a National Aged Care Alliance study concluded nursing homes and hostels throughout Australia faced a bill of more than $10 billion to upgrade facilities to meet accreditation standards by 2008.
Costs sending homes broke Sunday Herald Sun October 28, 2001

Nov 2001 Policies with a looming election

Mr Moran said he agreed with the Australian Medical Association and Catholic Health Australia in their support for Labor's policy, which includes a $200 million loan scheme to tackle the 12,000-bed shortage and the wage disparity that was leading to a chronic shortage of nurses.
Moran bites the hand - ELECTION 2001 - 7 days to go. The Australian November 3, 2001

Nov 2001 More than 2000 beds will be lost in SA

Meanwhile, more than 4000 nursing home beds in SA will be lost in the next two years as a result of spiralling costs and lack of government funding.

The Australian Medical Association warning was made amid a major increase in demand for more nursing home placements.
THE SATURDAY FEDERAL ELECTION Aged-care bungling exposed. Sunday Mail November 4, 2001

Nov 2001 Bronwyn Bishop removed

Prime Minister John Howard's removal of Bronwyn Bishop from the Aged Care portfolio ends widespread internal fears she was alienating one of the Coalition's core constituencies.
Sparkle and fizz splutters out. Canberra Times November 21, 2001

to contents

More information

For Updates:- A good way to check for recent developments in aged care is to go to the aged care crisis group's search page and enter the name of the company, nursing home or key words relating to any other matter in the search box. Most significant press reports are flagged there. The aged care crisis web site has recently been restructured and some of the older links used from this site may not work.

top of page

Web Page History
This page created Sept 2006 by
Michael Wynne