Duty of care

In the wake of disquieting revelations in two recent Royal Commissions, the governance of care is very much a front-and-centre consideration for boards in the sector.

Lap belt restraints left on for up to 14 hours a day, wounds untreated to the point of maggot infestation and unpalatable “slop” served at mealtimes were among a litany of complaints aired at the Royal Commission into Aged Care Quality and Safety, which handed down its final report on 1 March 2021. The report called for “fundamental and systemic aged care reform” and, along with other inquiries such as the Disability Royal Commission, has highlighted the need for boards to carefully consider how care and services are provided to “vulnerable” or “at risk” people. Central to this is the demand for clinical governance mandates and clinical skills to be factored into board composition.

The aged care Royal Commission noted in Recommendation 14: “The new Act should include a general, positive and non-delegable statutory duty on any approved provider to ensure that the personal care or nursing care they provide is of high quality and safe...”

It specifically recommends a care governance committee to monitor and provide accountability, stating that the committee should seek feedback from people receiving care, their families, their advocates, and staff, and notes that greater attention should be paid to developing a complaints system, on which the board is regularly informed.

Yet the AICD’s 2022 Not-for-Profit Governance Study found that many organisations are yet to establish such committees and require some further assistance in establishing a “care governance” approach.

When survey respondents were asked how their board ensures appropriate care and support is provided to recipients, 60 per cent of them said they relied on CEO/management reports, while only 11 per cent responded to utilising care committees.

Interestingly, just over two-thirds (68 per cent) of respondents to this question, were from sub- sectors that typically care for the most at-risk in our community — health and residential aged care and social services. However, respondents overwhelmingly indicated that their organisations are underutilising care committees to inform the board, with their reliance in residential aged care at 16 per cent, and only 12 per cent among social services organisations.

A commonality for organisations in these sectors remains profitability. Forty-one per cent of respondents in residential aged care indicated their organisation made a profit in 2022, which was down from 56 per cent in 2021. Social Services fared worse, with 49 per cent in 2022 making a profit, down from 66 per cent in 2021.

Collectively, the future priorities of these organisations remain protecting the lives and wellbeing of clients, with workforce planning a close second.

Virginia Bourke FAICD, chair of Mercy Health, says the new statutory duty is a significant recommendation that represents a shift in accountability for aged care providers, which can attract accessorial liabilities (involvement in the contravention of a law) and civil penalties.

She likens it to the same kind of duty that applies within work health and safety legislation, which demands directors behave in a proactive fashion. “You can’t fulfil the duty in just a reactionary way, waiting for something to go wrong and then responding,” says Bourke.

Meeting the standard of care

Bourke notes that a definition of high-quality care comes out of the Royal Commission recommendations as being care delivered with compassion, based on clinical assessment and responsive to residents’ needs, among other requirements.

However, neither the standard nor the description of how providers may meet the standard have yet been legislated. “Some of those elements are very subjective, so that’s quite challenging to test and measure,” she says.

Once the standards and definition of high- quality care are legislated, board members will need to ensure sufficient information flows to them to provide assurance that all these elements are in place and appropriate systems exist to capture that information.

Bourke notes that a clinical governance system integrated with other corporate governance systems is crucial.

“There’s a multitude of intersecting requirements now,” she says. “There are new governance requirements — about screening workers, the suitability of directors, complying with a code of conduct — and all of these will feed into satisfying this standard of care.”

Many larger providers will have established clinical governance systems already in place. Mercy Health has a long history of providing public health services and so many of the requirements that are new to aged care “are familiar territory for us,” says Bourke, while noting that the new rigour around systems and process will be “hugely challenging” for smaller providers already grappling with funding shortfalls, lingering COVID-19 considerations and significant workforce pressures.

“The increasing governance requirements, the explication of the standard of care and what that means in reality are factors, among others, that will drive consolidation in the aged care sector as it becomes increasingly challenging for smaller providers to meet these requirements,” she says.

Bourke adds that the work of Mercy’s care (quality and safety) governance committee is complemented by a highly developed internal audit system that is able to test the internal operating environment and then report where systems need adjusting.

“That’s been a strength of being a larger organisation — having robust systems that are integrated,” she says.

The core of clinical governance

Anne Cross AM FAICD, a St Vincent’s Health Australia director and chair of the board’s aged care committee, says having a board capable of governing in this area implies that its members should include people with aged care or other clinical experience.

“Boards could be supported in their core responsibility for the quality and safety of clients and residents by having a care committee focused specifically on these obligations,” she says. “The committee should be structured like most board committees —with a charter and a remit of overseeing quality frameworks, policies, personnel capability and monitoring agreed clinical and other indicators, such as client and resident experience, that follows up and probes particular issues, reviews findings of the regulator and monitors complaints.”

In the particularly egregious case of Assisi Aged Care Centre — which involved, in part, poor treatment of a patient’s wound, which led to maggot infestation — the Royal Commission pointed to the absence of medical practitioners on the board of Assisi and the lack of any clinical governance committee. It also found that the board’s lack of focus on clinical governance directly contributed to systemic deficiencies in the quality of care delivered to those at the facility. Further noted was an overreliance on volunteered complaints to uncover deficiencies in care, when, in reality, providers should be actively searching for those deficiencies themselves.

Cross says that while “complaints are like gold” in that they provide an insight into what’s not working, it was important that members of the board visit residential sites and have direct interactions with clients, residents and families.

“Visits also allow board members to have some insights into culture and to hear from staff to supplement more formal reporting that comes to the board,” she says. “One of the things that we do at St Vincent’s is to have a resident or client story at each committee and board meeting — it could be a good story [or] it could be a story where things have not gone well. And the people affected join us, if possible, to talk directly with us. If you only hear good things or the more superficial things, then you’re probably missing what’s really happening.”

Getting the culture right

The aged care Royal Commission also noted an overemphasis on short-term financial targets by some boards and a failure to consider the broader implications of company culture.

Liz Nicol FAICD, a non-executive director with Uniting NSW/ACT, acknowledges that the sector is under “incredible squeeze and difficulty” due to increasing costs and lowering margins, but points out that building a consumer-focused culture is of crucial importance.

Five years ago, Uniting introduced a “household model” — which the Royal Commission said was typified by a focus on a domestic, homelike, familiar or normalised environment with medical equipment hidden — into its residential care facilities, to get away from the traditional style of aged care, which can feel regimented and impersonal. It underpinned this structural change by revamping both its workforce and physical environment. At the start of 2022, the organisation reshaped its committee structure to create a dedicated seniors services committee.

Nicol, who chairs that committee, says its composition was designed to cover a range of skills and includes directors with aged care and clinical governance experience, in addition to external members who bring additional skills in clinical governance and financials in the aged care sector.

The seven members (comprised of five board members, two external experts and supported by five executive members) meet every second month for a “deep dive” into a service stream or a topic relevant to the aged care industry, in addition to regular reporting on clinical governance, safety, workforce, financials and strategy.

“We’re focused on elevating the conversation,” says Nicol. “We might ask things such as, how does the discussion that we’re having now support high-quality care for our consumers? How do we maintain a constant connection with mission and purpose?”

A focus on continuous improvement “requires us to be focused on creating an environment where it’s safe to raise issues and concerns — and allowing that conversation to be open and free- flowing,” she says.

Uniting has created a 10-year strategic plan to ensure continued improvement and sustainability over time. “We need to be keeping our eye on that into the future, because that’s the only way we can continue to provide the right level of care that is sustainable over time,” says Nicol.

To ensure sufficient skills in order to meet their obligations, she says directors need to regularly evaluate their own skills, and the skills of those in governance roles. “It’s important to be constantly curious about how we’re going, how we could improve, and what’s happening in the sector. What are other providers doing? What can we do to connect with other providers? Ultimately, we all need to work together to support the best outcomes possible for older Australians.”

Good example

Many stories emerging from the aged care Royal Commission were disturbing, especially for those in the industry like Liesel Wett OAM FAICD, who chairs Goodwin Aged Care Services, the ACT’s largest locally based NFP provider of independent living, residential care and in-home community care services. “It was very upsetting [to watch] some of the evidence that was given, where boards and chairs of boards didn’t know what was happening in their own organisations,” she says.

The Royal Commission has called for clinical governance mandates and clinical skills to be factored into board composition, with a view to decision-making with the end user in mind.

“When we make major decisions at Goodwin, we ask: Are we happy that Mum, Dad, Grandma or Grandpa would get the care we are making a decision about?” she says. “That’s going to influence what we deliver... If you’re not smelling and tasting the culture of your organisation, it doesn’t matter what your statistics say — you won’t know what’s going on.”

Goodwin has had a clinical governance committee for more than five years. “We were doing a lot of work at the board table, looking at all the lag indicators,” says Wett. “What are our finances doing? How’s our building and development going? But we weren’t actually looking at our models of care. We were challenging the CEO to look at innovation in that area, but we weren’t getting anywhere.”

Wett’s background — she is CEO of Australian Pathology and a non-executive director of Pathology Awareness Australia, and she was an AICD director from 2015–21, and a director of Doctors’ Health Services — meant she drove the establishment of the clinical governance committee.

“It’s like an audit and risk committee, but focusing on how we deliver care and how we clinically and medically look after people,” she says. “The chair at the time said to me,

‘That’s great, Liesel, you can chair it.’”

Wett chaired the committee for two years before handing over to the deputy chair, a lawyer. “He said he didn’t know anything about clinical care — and I said it doesn’t matter, it’s about doing the checks and balances in key areas.”

The committee was measuring falls, medications, incident trends and a host of other areas. “We gathered so much information on trends that at one stage, we knew we had an issue in one of our facilities, and we asked management what’s going on — something wasn’t right,” says Wett. “They conducted an investigation, made some changes and it improved.”

Based on observation, insights and research, Goodwin also blazed a path in terms of placing a pharmacist in aged care about fours ago. “That was led because we had a strong clinical team and it made a significant impact on the healthcare of our residents,” says Wett. “We prevented unnecessary hospitalisations, we reduced medication use and we reduced falls. We don’t have anyone on any psychotropic drugs and there are no restraints at any of our facilities.”

A bulk-billing geriatrician and a clinical nurse consultant are other key appointments — and the organisation’s research focus has also led to other smart initiatives.

“We’re running the Violet Initiative, which teaches our carers and staff how to help families when somebody’s dying,” says Wett. “It’s so important in an industry where, often, we don’t even talk about death and dying.”

Wett says Goodwin maintains an open and transparent recruitment process for directors. Those with clinical backgrounds are likely to find themselves in high demand in the future aged care industry.

“The aim is to challenge yourself,” she says. “You want people who are going to think outside the box or look at things with a different focus.”