Amber Crosthwaite and Richard Hundt

Legal & regulatory considerations for providers of residential aged care in response to novel coronavirus (COVID-19)

Amber Crosthwaite and Richard Hundt

March 13, 2020

Aged Care Retirement Villages

As the global pandemic and impact of COVID-19 continues to evolve, it has become clear that residential aged care facilities will be directly affected by the virus, and will face issues around supply chain, workforce and cash flow.

This note is intended to provide practical information for residential aged care providers from a legal perspective. We will update and re-issue it as required. Providers should bear in mind the interrelationship between their facilities and any co-located retirement village, particularly when considering their duty of care, their work, health and safety obligations and employment issues.

1. Legal and regulatory obligations for aged care

1.1 Duty of care

Given that COVID-19 has been labelled a ‘pandemic’, providers are no doubt aware that they owe residents, staff and visitors a duty of care both at common law and under applicable statutes – that is, they will need to take reasonable precautions to avoid those people being infected. The relevant standard of care is the practice that is widely accepted by the health profession as competent professional practice. This will include, but not be limited to, consideration of the Aged Care Quality Standards (see below).

1.2 Business continuity management

We discuss the Aged Care Quality Standards in more detail below, however, it is worth highlighting the fact that ‘business continuity management’ is part of the risk management element of a corporate governance framework and therefore a fundamental expectation under Quality Standard 8.  Providers should be updating and testing their business continuity plans for a COVID-19 outbreak including in relation to the following issues or elements (some of which are explored further below):

  • Establishing a cross-functional crisis management team: The team should be based on a structure which connects the board to the front line and include specialist advisory roles ( eg. crisis management, communications, legal and technology) to the extent these cannot be sourced in-house;
  • Crisis management governance: Including triggers for activation of an incident control phase and, later, a recovery phase, delegations, roles and responsibilities, communication, meeting agendas and checklists etc;
  • Stakeholder management: Managing messaging to stakeholder groups is critical particular in respect of residents, families, employees, the Department of Health and the Aged Care Quality & Safety Commission (Commission);
  • Risk assessment & planning: A full financial, operational, governance and legal risk assessment should be carried out and strategies for mitigation implemented:
    • Financial: Updating financial forecasts and related operational planning. Such should assume increased costs of supplies and labour and, importantly, a likely increase in current RAD liabilities if an outbreak occurs;
    • Employment and industrial relations: Legal issues involving all employees and contractors working at facilities should be properly considered as part of early preparation and planning (see para 1.3 below);
    • Regulatory/resident agreement constraints: The impact of regulatory and resident agreement constraints on providing care and services to residents in the context of an outbreak should be considered (see para 1.4) below;
    • Material contracts: Material supply contracts and also any contracts relating to the acquisition, divestment or development of property should be reviewed (see para 1.5 below); and
    • Insurance: Current insurance terms and coverage should be reviewed, particularly as they may relate to business interruption and public liability.

The plan should cater for both an incident control phase and then a recovery phase.

1.3 Employment and industrial relations

Providers should review and consider:

  • Employment documents: The specific terms of employment (including contracts, awards and enterprise agreements) and contractor agreements – in particular relating to working hours, location, leave, fitness for work and stand-down;
  • Scope of directives to employees: the extent to which healthy staff can be required to report for work when there is an actual or suspected outbreak – and conversely the extent to which staff should be required to stay home as a preventative measure;
  • Policies and procedures covering:
    • staff who are at risk due to recent or planned travel, as well as other potential exposure;
    • staff reporting exposure to risk and actual infection;
    • directing staff to go home;
    • working from home, including safety measures; and
    • the extent to which employers are required to pay staff (and the type of leave they are required to take) in each applicable circumstance;
    • the requirement for any specific personal protection equipment (eg. masks, gloves) in the particular circumstances of the workplace;
  • Communications strategy: a clear communications strategy which ensures that staff are aware of the above policies and procedures; and
  • Supervision: appropriate supervision to ensure compliance with the relevant policies.

Providers should seek legal advice if they are considering:

  • requiring staff to work on-site when there has been an outbreak (or a suspected outbreak); and/or
  • requiring staff to take any form of leave or work from home when they are not sick.

When managing industrial relations matters, providers should also consider the duty of care owed to employees with weak immune systems or respiratory illnesses (or other identified at-risk conditions), particularly if the employer intends to direct staff members who are otherwise healthy back to work.

1.4 Regulatory/resident agreement constraints 

Providers should consider whether the Aged Care Act 1997 (Cth) and/or their resident agreements:

  • allow them to cease the provision of extra services or additional services (or the manner in which they are provided);
  • allow them to restrict or remove access to certain any amenities (eg. access to pools or spas); and/or
  • include any requirement to isolate or move residents around the facility.

Where providers remove an additional service or an extra service, they will need to consider whether it is necessary to reduce the relevant fees payable for those services.

Providers may also need to consider changing the way in which social activities and group activities are managed.

1.5 Material contracts

In the context of a potentially compromised supply chain, key supply contracts should be reviewed to ascertain whether they are robust enough to ensure the supplier prioritises access to the provider.  For example, would a supplier be able to rely on a force majeure clause to avoid the obligation?

Providers should also consider the implications under other material contracts if they are unable to honour their own obligations (eg. as to payment).

If providers are in the process of buying/selling property, or developing a facility, or have entered an agreement to lease a facility, then those documents should be urgently reviewed in the context of COVID-19 to ascertain the impact of either party being unable to perform their obligations.

1.6 Aged Care Quality Standards

The Commission has warned providers that they should be paying close attention to requirements under the Aged Care Quality Standards (Quality Standards) at this critical time and be vigilant in maintaining the highest possible standards for minimisation of infection-related risks. Relevant standards include:

  • Quality Standard 3, Requirement 3(g) – Personal Care and Clinical Care, particularly in the context of the minimisation of infection-related risks; and
  • Quality Standard 8, Requirement 8(e) – Organisational Governance, particularly in the context of effective organisation wide governance involving infections, business continuity planning and the practice of open disclosure.

As part of their business continuity planning, Providers should undertake a self-assessment against the Quality Standards taking into account the requirements under Standard 3 and Standard 8 and ensure that they have in place arrangements for:

  • monitoring for COVID-19, assessment, and testing;
  • assessment and management of risk associated with infectious outbreaks if infection is suspected or identified;
  • ensuring adequate care of the infected individual (including space and resources);
  • protection measures for consumers, staff and visitors; and
  • notification advice to consumers, families, staff and relevant authorities.

We recommend that the above arrangements are tested in ‘real-life scenarios’ to identify otherwise unanticipated issues (eg. issues around isolation and restraint, resuscitation, hospital transfers, advanced care directives, confidentiality and privacy etc).  Providers also need to consider whether they should change the way in which they deliver day-to-day care, particularly where these occur in group settings (eg. dining and social/lifestyle activities).  Please also see paragraph 1.2 in relation to business continuity management.

Finally, the ACQSC will also expect providers to keep up with the information being released by relevant authorities (including the Commission, Commonwealth Department of Health and their relevant State or Territory health department) and to seek advice where appropriate.

1.7 Annual flu vaccination

While the flu vaccine for 2020 is not yet available, providers are required under the Quality of Care Principles 2014 and the Records Principles 2014 to take precautions to prevent and control the flu and minimise infection-related risks. That includes:

  • having an effective infection prevention and control program that is in line with national guidelines;
  • offering free flu vaccinations every year to staff and volunteers, and keeping records of their vaccinations; and
  • the service demonstrating:
    • how it has promoted and informed staff and volunteers about the benefits of vaccination; and
    • the steps it has taken to encourage staff and volunteers to get vaccinated.

1.8 New risk based question for residential and home care services on COVID-19

The Commission has also announced that, as part of its response to COVID-19, its site visits will include the following new risk-based question on the minimisation of infection-related risks:

What action has the service taken to assess and minimise infection-related risks for the care of aged care consumers including the impact of a potential coronavirus (COVID-19) outbreak?

The Commission has advised that the above query will be raised by quality assessors at site visits for both residential and home care services.

Providers should therefore be prepared to quickly respond when this question is raised.  Paragraphs 1.1 to 1.7 covers some of the matters which should be addressed in this response.

2. Advice from the Department of Health

Given the heightened vulnerability of aged care consumers, the Department has advised residential aged care facilities to ‘have appropriate precautions in place to ensure residents continue to remain safe from COVID-19′ and that providers of aged care should take steps to ensure that family members or other visitors of residents do not put residents and staff at risk of infection:

  • if the person has recently returned from a country or region that is confirmed as either ‘high risk’ or ‘moderate risk’ of the COVID-19; or
  • if the person may have been in close contact with a confirmed case of the COVID-19.

Practically, residential aged facilities should align any additional internal processes applying to people on entering the service with the level of risk advised by the Australian Government.

3. Coordinated national response in Australia

For its part, the Australian Government has joined other affected countries to anticipate the likely rise in the number and rate of infections. Among the steps taken to date include, for example:

4. Contact

If you would like to discuss any aspect of this article and/or would like us to provide advice, please contact a member of Thomson Geer’s Health, Aged Care and Retirement Villages or Employment and Safety teams.

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