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Are you aware of the new arrangements for allocated and provisionally allocated places?

By Julie McStay12 Feb 2016

The Aged Care Amendment (Red Tape Reduction in Places Management) Act 2016 (the Act) commenced on 11 February 2016, bringing a number of changes to the way allocated and provisionally allocated places are managed and transferred between approved providers.

Transfer of allocated places

The Act amends the Aged Care Act 1997 (Cth), giving effect to a new system for transfers:

  • Transfer notice 
    Approved providers are no longer required to lodge an ‘application for approval to transfer places’. The transferor and the transferee now lodge a ‘transfer notice’ with the Department. Once the notice is lodged the transfer automatically takes effect on the proposed transfer day unless the Secretary of the Department requests further information or vetoes the transfer.
  • Secretary must consider the transfer notice
    While the administrative process is more streamlined, the criteria which the Secretary must be satisfied of for the transfer to proceed remain largely unchanged. For example, the parties must still provide information about how the transfer will meet the objectives of the planning process, the suitability of the transferee and how the needs of any relevant care recipients will be met by the transfer.
  • Notice to resolve may be issued
    If the Secretary has any concerns about the proposed transfer or requires further information, a ‘notice to resolve’ may be issued no more than 28 days after receiving the transfer notice. The notice must detail the issues identified by the Secretary and specify which party is expected to respond to each issue.
  • Notice of veto may be issued
    If the Secretary is not satisfied that the proposed transfer meets the legislative requirements, the Secretary may issue a veto notice up to 7 days before the proposed transfer date. There is no requirement to issue a notice to resolve before issuing a veto notice.
  • Timeframe for veto 
    Under the previous system the Department was required to approve or reject an application to transfer places at least 14 days before the proposed transfer date. Under the new system the Department can veto the transfer up until just 7 days before the proposed transfer date.

Transfer of provisionally allocated places

The new system provides a process for transferring provisionally allocated places which is similar to the transfer of allocated places, including power to veto the transfer or seek further information from the parties.

Changes to provisional allocation period

The provisional allocation period has been increased from 2 to 4 years. The circumstances in which the Secretary is able to grant an extension to the provisional allocation period have also changed.

The change to the provisional allocation period also applies retrospectively to current provisional allocations. This means that if a current provisional allocation is one year into the allocation period, it is automatically extended and now has 3 years remaining.

What this means for providers

  • New process for transferring places: If you are considering transferring or receiving a transfer of places you will need to use the new ‘transfer notice’ that the Department is set to release shortly. We can assist you with navigating the new process and advise you on any issues that might arise in your sale or purchase transaction.
  • Extension to the provisional allocation period: Providers currently holding a provisional allocation of places may find that the provisional allocation period has automatically been extended, depending on the date the period commenced.

In this alert we have set out a broad summary of the changes in the new Act for your consideration. This alert is not intended to be a substitute for legal advice. If you would like legal advice about the new Act and its implication for your particular circumstances please contact Julie McStay, Director Aged Care and Retirement Living, Hynes Legal .

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