How we got here

From where we were, to where we are now

History: Care of those who can no longer care for themselves, and support for their carers, have traditionally been the responsibility of our communities. In the past they banded together under altruistic, religious and community banners to provide health and aged care. The idea that human decrepitude should become a commodity to be traded and exploited for the profit of disinterested investors would once have been abhorrent.

The 20th century: As costs increased and care became more complex, government regulated and then took over most of the funding. Government funding provided a steady income stream and individuals were drawn by the profits that could be made.  Some built empires and became wealthy.  They smarted under the restraints  and culture imposed by the not-for-profit structure of the system.  They were envious of the large profits being made in the unregulated USA. They gained increasing influence through lobbying and political donations.

A far more radical belief in the general utility of markets in our global partners was readily adopted by our marketplace and by our politicians. The primary humanitarian focus of the sector was changed and economic thinking came to dominate policy.  With the baby boomer bulge on the horizon more capital was needed.

In order to generate funds for expansion from investors rather than from taxes, the sector was reconstructed as a competitive marketplace. This was underpinned by the new global belief in markets and their universal applicability.  The government encouraged individuals and companies to enter the market and went shopping themselves for big multinational companies with marketplace expertise and large resources.

Citizens can reasonably infer that they were manipulated and misled, and their humanitarian mission betrayed as there was little in depth public debate of this prior to the 1996 election. It was done in large part to meet the needs of party donors who claim to have written most of the policy, which was rammed through in the face of intense political opposition.

In doing so constraints were removed and a critical condition for a market to work was ignored. This was that there be a knowledgeable and effective customer and that the customer should have the power to insist that the provider provide what he or she wants. Long established market theory was simply ignored.

Aged Care in not unique: As part of a thought bubble, which became an ideology in the 1980s, unregulated markets have been introduced into sectors where customers were previously considered to be vulnerable. In doing so, no steps were taken to modify the sectors that were turned into markets or the way in which the market was applied in these sectors.

Most of these sectors have been characterised by recurrent fraud and the exploitation of vulnerable people. The startling criminal scandals we read about in our newspapers are so widespread that they must be red flags to a pervasive and wider pattern of just legal or difficult-to-detect illegal behaviour that impairs the way these sectors operate for citizens.

Like all ideologies proponents are unwilling to acknowledge, even to themselves, that there are serious flaws in what they did. No adjustments are made to cope with the problems they have created. Society has to step in and do this. I am suggesting how this could be done in aged care. I see all this as part of a wider human phenomenon.

For lack of a better word, I have called it culturopathy. I have used "culturopathic" as a descriptive term for "cohesive groups of people whose patterns of belief and actions are harmful for society". They impair the operation of society and impede democratic processes by their mode of operation. They maintain their credibility, and placate society, by controlling and interpreting the flow of information.

By giving it a name we can talk about it constructively. I am talking primarily about normal well-intentioned people, often pillars of society, who have uncritically adopted a belief system that is successful in some sectors of society. They fail to recognise the consequences of what they are doing for other sectors that are not benefited. I am not pointing fingers at "bad" people, although some might be.

Aged Care invaded: In aged care, local and international corporations, even Wall Street-based banks who had defrauded their customers, were encouraged to invest in aged care and look for profits. While professing humanitarian motives, dominant corporations have brought with them a corporate for-profit culture that has challenged and eroded the not-for-profit humanitarian ethic.

Not-for-profit response: The religious and community groups have been forced into the same mould in order to compete in this new market. To do so they have brought in managers recruited from the corporate sector. These managers have probably made the not-for-profits more efficient. They have also slowly persuaded them to think and behave their way.

Not-for-profit groups have lost their sense of mission and are conflicted: They have lost their close relationships with the community. Their financial dependence on government has forced them to align themselves ever more closely with the for-profit sector, and with ideologically-driven government policy.

Aged care is not unique. It is part of a common, current, worldwide problem, one that the world is grappling with. Not-for-profits in many sectors and many countries are grappling with the same issues.

Going forward not back

The predicted massive population bulge in the elderly, caused by the arrival of the baby boomers, has started and it is too late to go back to a not-for-profit system now. The wider society generally accepts the market economy as the way we now provide services and sees nothing wrong with it. We have to make this market work and in my view the only way to make sure it is working is to create an effective customer.  That is what market theory says we need.

It is interesting that the idea of a proxy customer has already worked successfully in Australia - in hospitals. In 2002, medical specialists stepped up as the real customers of hospitals, the ones with knowledge and power. They showed that they could and would bankrupt Australia's largest hospital owner, Mayne Health, when it stepped out of line and started behaving like the big fraud prone hospital chains in the USA.

Finding a customer: In aged care, residents and families lack knowledge and are too vulnerable to be effective customers. In an article Old folks, new monopolists: the age of the nursing home the grand daughter of a resident in a corporate nursing home describes the everyday experience of residents and families of being powerless in a nursing home. As she says, the nursing homes "easily take advantage of this: they know, once you are in, it is very difficult to get out". All too often care itself suffers from similar practices to those she describes.

At the same time, the government is moving towards a consumer directed model of care. This is a positive idea, but only if frail elderly consumers are capable of acquiring knowledge and then exercising the power to be an effective customer on their own. One of the things this proposed hub aims to do is to give them the trustworthy support and advice that will enable them to be effective citizens and customers.

Doctors do not have the same influence or any economic power in nursing homes. Undervalued in a system that does not see aged care as a medical condition and unable to do anything, they have been vacating the sector. The real customers of this market, which takes its profits from the money provided for the care of the frail and mentally compromised, should be the local communities who were once responsible for care - not residents and their families, nor governments. They need the knowledge and the power to make it work.

Yet these communities have been disenfranchised, disempowered, sidelined, denied information and their attention directed elsewhere. In 1997, when they had more information, they were in revolt against the new aged care bill and were a political threat.

The following matters are critically important to empower the community and turn them into an effective customer. The fundamental market principle of having an effective customer must not be compromised. Without a customer, a market simply does not work. This is common sense - not pie in the sky theory or rocket science.

1. Give them an important partnership role in the aged care process
2. Give them access to and control of information
3. Give them the power to decide who will provide aged care services in their communities
4. Make them, and not provider-employed case managers, the group that advises and assists the elderly and their families when they need help in choosing services.
5. Give the community hub a major role as the customer in deciding who owns and operates services in Australia, and also in their local communities when local aged care services change hands or are built. They need to be well aware that owners offer services, control funds and appoint managers.

This is critical if the market is to work for the country and the community.

I am not suggesting that what we had in the distant past was better. There have been many advances and expectations are much higher. What I am suggesting is that the system today places us at high risk. It does not do as much as it could or should. There must be a better way.