Recommendation 2: Rapid review of pricing for residential care
Recommendation 2 of the Independent Review, released in August 2024, called for a rapid review of pricing and contracting for residential care and for funding to be maintained at current levels until this work is completed.
Current funding arrangements for residential care are complex to administer and difficult to navigate.
We are developing and testing a banded approach to funding, that will improve consistency and fairness and enable stronger fiscal sustainability.
It aims to reduce the administrative burden on providers and NASCs by simplifying how funding is organised. More information on this approach is in the December 2024 Cabinet paper external.
Provider engagement
In November 2024, DSS held engagement sessions with representative groups of small, medium, large and Aged Residential Care providers.
These workshops focused on current issues about funding of residential care and what could be done to improve things.
You can read a summary of themes from the sessions here. Alternately, download this information in PDF or Word format.
- Residential care provider engagement sessions summary (DOCX 418 KB)
- Residential care provider engagement sessions summary (PDF 370 KB).
Providers were also able to share their thoughts through an online survey specifically designed for Recommendation 2.
Read the summary of feedback received here. Alternately, download this information in PDF or Word format.
- Recommendation 2: Summary of submissions from residential care providers (DOCX 80 KB)
- Recommendation 2: Summary of submissions from residential care providers. (PDF 158 KB)
Guiding principles
The insights and feedback shared in the engagement sessions have helped inform principles to guide this work:
- Continuity of care: disabled people in residential care continue to receive quality and safe care in their usual place of residence.
- Service capacity maintained: disabled people, their family and whānau maintain choice and control about where they live. NASCs and Enabling Good Lives (EGL) sites take a fair, consistent and transparent approach to eligibility for residential care.
- Transition supported: providers will be supported to transition to the new pricing model, where appropriate.
- System efficiency improved: the design of the new pricing model will contribute to stabilising disability support services by promoting efficiency gains (and avoid introducing any new inefficiencies).
- Sustainable funding: implementation of the new pricing model must be affordable.
- Realistically deliverable: the proposed changes must be practically implementable as soon as possible.
- Stabilisation enhancing: the pricing is fairer, more consistent, and more transparent. Through simplifying the pricing system, we do not constrain future design decisions.