Response to COVID-19: Where To From Here For Aged Care Providers?

The increased risk of COVID-19 and the greater probability of serious complications among elderly residents has resulted in unprecedented pressure for aged care providers.

The restrictions on visitation rights put in place by the Australian Government to protect residents and workers in aged care facilities together with the new funding measures announced last week are expected to strengthen the industry and reinforce the aged care workforce.  However, there is a growing realisation among aged care providers that they will likely need to implement measures well beyond those mandated by the Government in order to effectively mitigate and manage the consequences of COVID-19.

As we begin to realise the full extent of the impact of COVID-19 on aged care operations, many of you are likely to be grappling with complicated issues that affect many areas of your operations.

EMPLOYMENT AND OHS

The Government has mandated many measures to manage the impact of COVID-19 in aged care facilities but is it enough?  What more can you do to further mitigate the effects of COVID-19 on your residents and staff?

• Do you have contingencies in place to ensure staffing levels are maintained if large numbers of your staff fall ill or need to self-isolate?
• Are sufficient measures in place to keep your workforce and residents safe and to ensure that you are meeting statutory workplace health and safety obligations?  Even if your aged care facility is in lockdown, have you implemented sufficient hygiene measures as staff enter and leave your facility?
• How do you manage the leave entitlements of staff who need to take extended leave to self-isolate or recover from illness?  What actions can you take if staff have insufficient leave to cover their period of illness or quarantine?
• How do you retain your workforce through this difficult period?  Do you have plans in place if staff are unable to come to work due to limitations on services such as public transport?
• Are you considering introducing measures beyond the Government’s mandated limitations on visitor restrictions?

If you need assistance with these or any other questions, please contact Lavan partner Ian Curlewis. 

CORPORATE GOVERNANCE

The impact of COVID-19 may prevent or delay your ability to provide the care and services required by your residents.  It may also increase the costs associated with providing these services.  In this challenging situation, it is important to consider: 

From a governance perspective:

• Do your policies and procedures adequately provide for the impact of COVID-19? 
• Has your board increased the frequency of its (and its sub-committee) meetings?
• Do your resident agreements have adequate emergency provisions in place to deal with the impact of resident isolation, staff shortages or facility lockdowns?  If you also provide retirement living or home care services, consider how these may be impacted.
• How effectively have you been able to reduce resident-to-resident contact and the risk of asymptomatic transmission?  Has this significantly impacted your meal arrangements and activities calendars?
• How robust are your risk and compliance programs, especially if non-patient contact staff have to work from home, how will this affect your compliance obligations?

From a corporate perspective:

• Given the likelihood COVID-19 will negatively impact on your ability to provide some or all of the services you are obliged to provide, have you considered how this will affect your contractual arrangements, both as a supplier and as a provider?
• Have you made contingency plans for any interruption to your supply of goods and services as well as the staff required to provide care and services?

Lavan senior associate Michele Ryan can assist you to formulate a plan to meet your obligations.

INSURANCE

As the full impact of COVID-19 is yet to be realised, it is important to review your current insurance policies and your practises to prepare for future contingencies.  This includes:

• Is your public liability insurance sufficient?
• Do you have appropriate systems in place to protect you from professional indemnity or even directors and officers claims, in the event that infections occur? This will in no small part tie in with your corporate governance reviews.

If you would like to discuss these or other insurance related concerns, please contact Lavan partner Iain Freeman.

MANAGING THE IMPACT ON YOUR BUSINESS

In the ever-evolving economic environment under COVID-19, it will be imperative for your organisation to consider its broader financial position and planning.  This includes:

• Are you continually assessing your liquidity position and management strategy, and stress testing your outcomes modelling as further information emerges about the potential scale of the impact of COVID-19?
• Is your board aware of the protective measures available to directors during this period particularly in relation to the existing safe harbour regime, as well as the protections available under the recent temporary changes to the insolvency laws?
• Does your planning for COVID-19 include consideration of the restructuring options that might be available to the business in the event of critical liquidity pressure?

If you would like assistance in understanding the options available to your organisation, the obligations of your directors and the meaning of the recently announced changes, please call Lavan partner Lawrence Lee.

TESTAMENTARY ARRANGEMENTS

Your residents are likely to be anxious in the present circumstances.  We are seeing an increase in enquiries from clients about updating their testamentary arrangements.

For any enquiries relating to testamentary arrangements, please call Lavan partner James Steedman.

CONSTRUCTION

COVID-19 is having an escalating impact on construction and infrastructure projects in WA.  This can vary from delay and disruption to exposure to increased costs, availability of labour or an inability to perform your contractual obligations.  If your organisation, like many other aged care providers, is currently managing a construction project, you should consider:

• What rights and entitlements exist under your contract to seek an extension of time or suspension of works?
• Is there a basis to claim additional costs?
• Does the contract include a force majeure provision and what are the consequences that flow from such an event?

Please contact Lavan partner Tamica D’Uva if you would like to discuss your contractual entitlements.

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We understand this is a difficult and challenging time for all aged care providers.  COVID-19 presents unprecedented challenges within a regulatory environment that is already challenged by the Royal Commission.

Lavan’s multi-disciplinary team is available to provide assistance with planning and implementing your response to COVID-19.  If you require any assistance, please do not hesitate to call any of our Lavan lawyers.