Directors need to be very aware of the evolving needs and responsibilities of aged care governance. 

    The recent legislative changes in response to the Royal Commission into Aged Care Quality and Safety have ushered in a new era for directors in aged care. These changes have significant implications for boards, requiring more than incremental improvement.

    Governance for quality aged care requires a reset. The AICD director tool, Governing for quality aged care: A director’s guide, provides practical steps for Australian directors to meet new governance obligations in the sector.

    Legislated governance changes, which apply from 1 December 2023, require that:

    • The majority of members of the board are independent non-executive members
    • At least one member of the board has experience in providing clinical care
    • A quality care advisory body be established to provide ongoing feedback and advice (including a written report every six months) on the quality of the aged care service
    • The provider annually offers to set up a consumer advisory body
    • Older Australians are prioritised in the organisation’s constitution of a wholly-owned subsidiary company, over the holding company
    • The board ensures staff have the appropriate qualifications, skills and experience to provide aged care services.

    Aged care boards need to be clear about some key principles. They will need to clarify the organisation’s purpose and the desired outcome for clients, and actively engage clients to amplify their voices.

    Quality of care and client outcomes need to be at the forefront of decision-making and this could require some boards to rethink care and clinical governance.

    Organisations will potentially need to cultivate a diverse skills-based board and promote a culture that attracts people with the required skills and a mindset for improvement.

    Client wellbeing

    At its core, the organisation’s purpose should set clear expectations for what it hopes to achieve for its clients. A critical benchmark for any aged care board should be their confidence in their clients’ wellbeing.

    Directors should consider using evidence- based tools to measure client health and wellbeing — for example, tools that measure quality of life, mood, physical health, social relationships and the ability to participate in decision-making — directly linking performance measures to achievement of client objectives.

    This requires a strategic approach that focuses on client quality of life. In practice, this will differ by organisation, depending on the needs of the clients and the services provided.

    Having set clear expectations, the board’s role is to continually test whether those expectations are understood and whether they manifest as actual client experience.

    Some governance red flags would include: when the organisation claims to prioritise client wellbeing, but board reports lack measures linked to client outcomes; acceptance of poor client outcomes without a remedial plan to address deficiencies; an organisational and board culture of “blaming the aged care system” rather than accountability for client outcomes; an assumption that for-purpose providers can do no harm to clients.

    First-hand understanding

    A strategic aged care board needs to look beyond immediate challenges and anticipate the needs of the future. Risk management emphasis must focus on enhancing care outcomes rather than mere mitigation. Site visits give a vital opportunity to gain first-hand understanding of care, witness client outcomes and understand the risk environment, while innovation and technology are likely to play a significant role in enhancing care. A forward-thinking board will identify the relevant technologies and their potential applications, implementing solutions that improve client outcomes while managing risks appropriately.

    Directors need to be wary if the board reports lack measurement on the effectiveness of initiatives to improve care or if there is a lack of verification or external assurance processes to support board sign-off on compliance. Questions should be raised if board reporting is centred on retrospective analysis rather than proactive planning and execution, or if the board meetings are consumed with debating issues that ultimately would be unlikely to deliver on the clients’ goals.

    Diversity of needs

    Good care and clinical governance cannot be the same across the diversity of providers and consumer needs. Achieving better care and clinical governance practice requires a governance structure that drives a proactive approach to both, with clear leadership and accountability.

    The board should seek to understand how their governance framework enables the organisation to deliver care that improves its clients’ quality of life and how the framework provides early warning signals of any issues that require prompt attention. The board must satisfy itself that the systems are suitable for the services

    Governance must be something that is constantly reviewed. Recurring high-risk audit actions that have not been addressed, and care and clinical governance that is not considered regularly by the full board, are red flags.

    Culture and skills matrix

    To achieve the most positive outcomes, boards will need to diversify their skills matrix. They should insist on appointing directors with clinical care experience and members that can provide a range of perspectives.

    It is equally crucial for the entire board to elevate their clinical literacy, as the board should never solely depend on the insights of just the one director with clinical expertise. Directors should have sufficient knowledge to proactively engage, ask pertinent questions, test management responses and form an opinion regarding the quality and safety of care. Directors should invest in enhancing their skills and knowledge on an ongoing basis.

    Many aged care organisations might be struggling with entrenched assumptions and will need to eliminate persistent stereotypes to foster a progressive approach to client interactions. This is likely to require investment in developing a culture that promotes a growth mindset, equips staff with skills to handle change and ensures psychological safety. The environment needs to be one where all staff — from frontline caregivers to senior management — align their actions with the overarching goals of quality and care and improved client outcomes.

    It begins with the board

    A client-centred culture of continuous reflection and improvement starts with the board. Aged care boards need to satisfy themselves that their organisation’s value proposition for employees is appropriately tailored to attract the right talent. This encompasses investing in relevant training, effective supervision and a fair reward system. Boards need to be asking whether they have endorsed a workforce strategy suitable to deliver on the organisation’s purpose and whether the workforce metrics in the board reports are providing adequate line of sight to the key issues.

    It is essential that the organisational culture supports staff to feel confident and encouraged to report incidents, near misses and opportunities for improvement. Often, the most valuable insights come from those directly involved in care delivery. By creating avenues for regular interaction with frontline staff, boards can gain a ground-level perspective on challenges, successes and areas of potential improvement.

    This article first appeared under the headline 'Governing for quality aged care’ in the May 2024 issue of Company Director magazine.

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