The Australian Government supports care for older Australians living in aged care homes through a government subsidy that homes receive based on the aged care provider’s appraisal of each resident’s care needs. From March 2008, the Aged Care Funding Instrument (ACFI) replaced the Resident Classification Scale (RCS) as the mechanism to allocate this Government subsidy.

The ACFI was developed in response to the Review of Pricing Arrangements in Residential Aged Care carried out by Professor Warren Hogan in 2004 and the RCS Review in 2003. The ACFI is designed to:

• better match funding to the complex care needs of residents;
• reduce the documentation created by aged care providers to justify funding; and
• achieve higher levels of agreement between aged care staff and departmental review officers in review audits (known as validation).

The Australian Government committed to a post-implementation review to ensure that the new instrument is meeting its objectives.