AN-ACC: Australian National Aged Care Classification Residential Funding Model
AN-ACC replaced ACFI from 1 October 2022 as the residential aged care subsidy model: 13 classes, fixed and variable funding components.
Transition from ACFI to AN-ACC
The Australian National Aged Care Classification (AN-ACC) replaced the Aged Care Funding Instrument (ACFI) as the residential aged care funding model on 1 October 2022. This transition implemented Recommendation 120 of the Royal Commission into Aged Care Quality and Safety final report (March 2021) and reflects a significant shift in how residential aged care services are funded. The Aged Care Act 2024 plain English governs this new framework.
Under AN-ACC, funding is determined by the care needs of residents and the characteristics of the service. This contrasts with the previous ACFI model, where assessments were conducted by provider staff. This change aims to ensure funding more accurately reflects the complexity of care required, aligning with the Aged Care Quality Standards 2024.
Assessments for AN-ACC are now conducted by independent assessors organised by the Department of Health and Aged Care. This removes the potential conflict of interest inherent in the ACFI model and ensures a more objective determination of resident care needs. Classification is based on the AN-ACC Assessment Tool, which utilises validated functional and behavioural measures.
Funding structure: fixed and variable components
AN-ACC subsidies are structured with two primary components: a fixed component and a variable component. The fixed component, known as the base care tariff, is paid per resident per day. This base care tariff is differentiated based on factors including the service’s location and whether it specialises in Indigenous care. [Aged Care Act 2024 plain English]
The variable component of the AN-ACC subsidy is determined by the resident’s AN-ACC class. This ensures funding reflects the complexity of care needs. An adjustment payment is also provided for services specialising in homeless care.
The AN-ACC price is set annually by the Independent Health and Aged Care Pricing Authority (IHACPA), which took on this responsibility from 1 July 2023. A one-off transition top-up payment was provided when AN-ACC commenced to ensure providers were not disadvantaged compared to previous funding arrangements.
The 13 AN-ACC classes
The Australian National Aged Care Classification (AN-ACC) categorises residents in aged care homes into one of 13 classes. Each class is linked to a different daily subsidy, reflecting the level of care required. The classification system aims to ensure funding aligns with the assessed care needs of each resident, supporting the delivery of quality care in line with the Aged Care Quality Standards 2024.
Class 1 is reserved for residents admitted for palliative care and attracts the highest subsidy, acknowledging the specialised needs associated with end-of-life care. Classes 2 through 13 are assigned based on the results of the AN-ACC assessment. This assessment considers a range of factors including cognitive ability, physical function (such as mobility), the risk of pressure sores, and behavioural indicators.
The AN-ACC assessment determines the complexity of care needs, with subsequent classes representing progressively increasing levels of care complexity. Residents are subject to reassessment when their condition changes significantly or as directed by the assessment management organisation.
Care minutes and provider obligations
Residential aged care providers are subject to mandatory care minutes targets. From 1 October 2023, the sector-wide average was set at 200 care minutes per resident per day, including 40 minutes of registered nurse (RN) time. This requirement increased to 215 care minutes, including 44 RN minutes per resident per day, from 1 October 2024. Care minute targets are determined for each service, taking into account the resident profile and AN-ACC classes. Aged Care Act 2024 strengthened standards
Alongside care minute requirements, providers must also adhere to the 24/7 registered nurse responsibility, which commenced 1 July 2023. This obligation mandates that a registered nurse is always present and on duty within the residential aged care service.
To demonstrate compliance and inform AN-ACC pricing, providers are required to lodge Quarterly Financial Reports (QFRs) and Quarterly Care Minutes Reports with the Department.
Frequently asked
When did AN-ACC replace ACFI?
AN-ACC commenced on 1 October 2022, replacing the Aged Care Funding Instrument (ACFI) as the residential aged care funding model. The change was a key Royal Commission into Aged Care Quality and Safety recommendation, designed to provide more equitable funding based on independently assessed resident need.
How many AN-ACC classes are there and how are residents classified?
There are 13 AN-ACC classes. Class 1 is for residents admitted for palliative care. Classes 2-13 are determined by an independent assessor using the AN-ACC Assessment Tool, which considers cognitive ability, function (e.g. mobility), pressure sore risk and behaviour. Each class has a different daily variable subsidy reflecting the relative cost of care.