Aged Care the Q4 2025 Sector Performance Report and the Imperative for Systemic Change

A Sector at a Tipping Point

The Aged Care Quality and Safety Commission's final quarterly report for the 2024-25 financial year presents a sector caught in a profound tension. On one hand, the data reveals significant, hard-won improvements in performance over the past three years. On the other, it exposes deeply entrenched systemic risks that threaten to undermine this progress. With

more than a quarter of all Australians 65 years and older now using aged care services—a population that has grown by 9% in residential care and 8% in home services over the last three years alone—the dual pressures of immense scale and relentless growth demand an unflinching assessment of its performance. The data contained within this report is more than a retrospective; it is a critical benchmark on the eve of a new Aged Care Act. It forces us to ask a difficult but essential question: are the sector's current regulatory and operational models truly equipped to handle the escalating demand and complexity of the coming decade, or is a more fundamental transformation required?

A Critical Retrospective: Analysing Three Years of Sector Performance (2022-2025)

To fully appreciate the challenges and opportunities facing the aged care sector, we must look beyond quarterly fluctuations. The three-year trend data presented by the Commission offers a crucial diagnostic tool, allowing us to identify the foundational strengths and, more critically, the chronic weaknesses that define the aged care landscape. This deep analysis is essential for providers and policymakers as they prepare to navigate the seismic shifts introduced by the new Aged Care Act.

The Performance Gap Between Residential and Home Services

A clear and troubling pattern emerges from three years of compliance data: a persistent and significant performance gap between residential care and home services. While both sub-sectors have shown improvement, their trajectories have been markedly different.

• Residential Care: Compliance with the Quality Standards improved from 58% in Q1 2022-23 to a more robust 81% in Q3 2024-25.

• Home Services: Compliance improved from a low base of 46% to just 64% over the same period.

Sector compliance rates with the Quality Standards 2022–23 to 2024–25: reaccreditation audits

As highlighted by the Commission, the performance gap between the two has remained stubbornly fixed at around 20 percentage points throughout the entire three-year period. This disparity is particularly concerning given the rapid expansion of in-home care, where the number of service users grew by 8% over the last three years. The data suggests that as more Australians opt for care at home, they are increasingly being served by a part of the sector that demonstrates a systemic struggle to meet baseline quality standards.

The number of older people using aged care services over the past 3 years increased by 8% in home services and 9% in residential care

The Anatomy of Non-Compliance

Drilling down into the specific Quality Standards reveals that non-compliance is not random but concentrated in areas fundamental to the safe and effective operation of any care provider.

• Assessment and Planning (Standard 2): Failures in this standard directly impact the quality of individual care. The Commission's finding that "Many home services that did not meet this standard have not been doing regular reviews of their care and services" is a critical indictment of providers' ability to deliver person-centred care that adapts to the changing needs of consumers.

  

• Human Resources (Standard 7): The data for Standard 7 validates the workforce crisis that is widely understood across the sector. The report notes that providers in both residential care and home services "find it difficult to meet the requirements to assess, monitor and review their workforce." This is not merely a staffing shortage but a systemic failure in the strategic management of human capital.

  

  
  

• Organisational Governance (Standard 8): The report identifies Standard 8 as the epicenter of sector-wide failure, stating "this Quality Standard has had the lowest rates of compliance throughout 2024–25 in both residential care and home services." While home services compliance in this standard has commendably risen from a low of 52% to 82%, and residential care has reached 91%, its consistently poor ranking points to a fundamental deficit in leadership, risk management, and effective oversight at the highest levels of provider organisations.

  

  
  

These persistent failures in the core pillars of governance, workforce, and care planning are not isolated issues; they create the conditions for the negative outcomes we see in incident and complaint data.

Interpreting the Signals from Incidents and Complaints

The data from the Serious Incident Response Scheme (SIRS) and consumer complaints are not just metrics; they are the critical real-world indicators of the compliance failures discussed above. These data points represent the 'alarms' of severe harm and the 'whispers' of consumer dissatisfaction, revealing the human cost of the sector's systemic weaknesses.

Decoding the Serious Incident Response Scheme (SIRS) Data

The SIRS data tells a story of escalating risk, particularly in high-impact, preventable categories.

• Residential Care: Notifications steadily increased over the three-year review period, peaking at over 15,000 in a single quarter before a recent minor decline. The single largest incident category is alarmingly consistent: "Unreasonable use of force" accounted for 7,221 notifications in Q4 alone.

  

  Statistics indicates unreasonable use of force accounts for more reports than all other incident types combined

Unreasonable use of force accounts for more reports than all other incident types combined.

• Home Services: Since its introduction, SIRS notifications have grown steadily. Here, the dominant issue is "Neglect," which accounted for 923 notifications (60%) in Q4. A closer look reveals the operational reality behind this statistic: missed shifts accounted for a quarter of these notifications, while another quarter involved systemic issues like rostering errors. Medication and falls management were the most common clinical failures reported under neglect.

  

  Statistics indicates neglect accounts for 60% of all reported incidents in home services

Neglect accounts for 60% of all reported incidents in home services.

Critically, the Commissioner injects a note of caution regarding the recent drop in notifications, suggesting it "may also mean some incidents are not being detected or reported." This implies the true scale of serious incidents could be even greater than the already high numbers suggest.

Listening to the Voice of the Consumer: Unpacking Complaint Trends

Complaint data provides a direct feedback loop from consumers and their families, and the trends draw a straight line back to operational and systemic failures.

• Residential Care Complaints: The top issues have remained consistent over three years. "Medication administration and management has been the top complaint issue for the last 2 years," a finding that correlates with high-risk clinical failures. More recently, complaints about "Falls prevention and post fall management" have increased significantly, becoming one of the top two issues.

  

  Bar graph for residential care indicate falls prevention and post-fall management issues have increased over the past 3 quarters. They are now, along with medication management, the most complained about issues in residential care

• Home Services Complaints: The data for home services is unequivocal. "Lack of consultation/communication has been the top complaint issue for the past 3 years," followed closely by "Fees and charges." These are not clinical failures but fundamental breakdowns in customer service, transparency, and relationship management.

  

  Bar graph for home care indicate the most complained about issue is a lack of consultation or communication.

The high volume of incidents and the consistent themes in complaints are not random events; they are the predictable outcomes of the foundational weaknesses in provider governance.

The Central Failure: Pinpointing the Governance Deficit

The myriad issues detailed across compliance, incident, and complaint data are not disparate problems. They are symptoms of a single, underlying cause: a systemic and critical deficit in organisational governance. The Commission’s own regulatory posture and findings provide a clear, evidence-based case for this conclusion.

The Commissioner's Verdict

The Commissioner’s message in the report is unambiguous and signals a profound strategic shift in the regulatory approach. This shift is predicated on identifying governance as the root cause of poor performance.

"Ongoing concerns about governance capability has led us to shift our focus to provider level rather than service level."

This statement is not a minor adjustment; it is a declaration that the regulator now officially views the quality of a provider's governing body and its management systems as the primary lever for ensuring quality and safety. The problem is no longer seen as isolated failures at a single facility but as a systemic issue originating at the corporate level.

How Poor Governance Manifests as Sector-Wide Risk

The link between poor governance (Standard 8 failure) and the negative outcomes seen throughout the report is direct and undeniable. Deficiencies at the board and executive level cascade down through the organisation, creating sector-wide risk.

• Workforce Instability: The persistent struggles to meet mandatory care minute and 24/7 RN coverage targets are a direct consequence of governance failures. Providers are failing at the strategic workforce planning, recruitment, and retention strategies that are mandated by Standard 7 and should be overseen by the board.

• Reactive Incident Management: The high rates of SIRS notifications for preventable issues like neglect and unreasonable force stem from a lack of proactive, board-level risk management frameworks. A strong governance system would identify, analyse, and mitigate these risks before they result in harm, rather than simply reporting them after the fact.

• Consumer Disconnect: The leading complaints in both home services (communication) and residential care (medication management) point to a failure in governance systems that should ensure consistent, high-quality service delivery and robust feedback loops. These are not failures of individual staff but failures of the systems designed to support them.

An Environment of Self-Reliance

Perhaps the most telling indicator of the new era is the sharp decline in formal enforcement actions like Non-Compliance Notices and Directions. The Commission explicitly states this is a deliberate strategy "to encourage providers to develop sustainable strategies to fix their non-compliance" without direct regulatory intervention.

This strategic withdrawal of the regulatory "safety net" places an unprecedented onus on providers to possess highly sophisticated internal governance and compliance systems. The message is clear: the regulator expects providers to identify and fix their own problems. Those lacking the governance capability to do so will be dangerously exposed.

The governance deficit is therefore not simply a problem to be managed; it is a chasm that must be bridged with a new generation of tools and strategies designed for this new reality of self-reliance.

The Path Forward: Embracing a New Paradigm of Proactive Governance

In the face of escalating complexity, growing demand, and a new regulatory posture of provider self-reliance, incremental improvements are no longer sufficient. The aged care sector's long-term viability and its ability to deliver safe, quality care now depend on a fundamental shift from a reactive, paper-based compliance model to a proactive, data-driven, and technology-enabled governance paradigm. This is an inevitable evolution for any provider committed to its duty of care.

Defining the Requirements for a Future-Ready System

Based on the systemic failures identified throughout the Commission's report, an effective modern governance solution must possess a core set of integrated capabilities.

Unified Risk and Compliance Management: A system must provide a single source of truth that connects organisational risks directly to compliance with the Quality Standards. This directly addresses the interconnected failures in Standard 2 (Assessment and Planning), Standard 7 (Human Resources), Standard 8 (Governance), and by integrating all facets of care delivery and oversight.

Real-Time Incident and Feedback Monitoring: To move from reactive reporting to proactive prevention, providers need systems that can identify trends and hotspots from incident and complaints data in real-time. This capability would allow leadership to mitigate the very issues—such as medication errors, communication gaps, and falls risks—that currently escalate into SIRS notifications and formal complaints.

Predictive Workforce Analytics: The challenge of meeting care minute and 24/7 RN coverage targets cannot be solved with a paper roster. A future-ready system must use data to move beyond reactive scheduling to strategic, predictive workforce planning, ensuring the right staff are in the right place at the right time, and identifying future gaps before they occur.

An elderly man enjoys a peaceful outdoor stroll in a wheelchair, accompanied by a caregiver and a small dog

Transparent Board-Level Oversight: To remedy the core deficit in Standard 8, governing bodies require a platform that provides them with real-time, validated data on organisational performance. Dashboards that visualise risk, compliance status, and key performance indicators are no longer a luxury but a necessity for effective oversight and defensible decision-making.

The Inevitability of Transformation

Adopting a comprehensive, technology-enabled governance platform should not be viewed as a cost, but as an essential strategic investment in resilience and quality. In the new era heralded by the incoming Aged Care Act and a self-reliant regulatory model, a provider’s greatest asset will be its ability to demonstrably prove quality and effectively manage risk. Those who embrace this technological and operational evolution will be best positioned to meet their obligations, build consumer trust, and ultimately thrive. This transformation is both a credible and inevitable path forward. The Carelogix product solution is designed to address key structural and clinical deficiencies identified in the Aged Care Quality and Safety Commission Sector Performance Report (Q4 2024–25) by strengthening organisational evidence, improving frontline documentation, and providing real-time oversight.

Regarding Quality Standard 8 (Organisational governance), which recorded the lowest compliance rates throughout 2024–25 and is connected to failures in meeting financial and workforce obligations, the Carelogix Platform provides crucial support. The Carelogix Nexus is able to uncover insights at the point of care, aiding providers in maintaining adherence to critical standards and regulatory demands. Furthermore, the system’s ability to generate evidence-based reports and provide better oversight and real-time insights for the back office helps organisations manage the organisational governance complexities now prioritised by the Commission.

Carelogix Plat effortlessly captures critical data during point of care - allows frontline staff to focus on interaction with participants rather than documentation.

Carelogix also targets persistent clinical issues that lead to high rates of complaints and serious incidents. Medication administration and management and falls prevention and post-fall management remain the most complained-about issues in residential aged care, and are the most common clinical issues reported through neglect notifications in home services. The Carelogix Note mobile application enables frontline workers to perform effortless data capture using natural documentation features like voice and images. Although specific medication features are not detailed, this improved and strict documentation practice is crucial for managing these high-impact and high-prevalence risks, where providers often fall short.

Finally, in response to the Commission's encouragement for providers to review their incident management system and show how they keep improving to reduce incident likelihood, Carelogix provides the necessary data flow. The evidence generated by Carelogix Note, including automatic location tagging and Auto Summary Reports, delivers real-time insights needed by management to detect and address issues as they occur. Critically, the intuitive interface allows workers to capture client feedback at the point of care using predominantly voice and occasionally location & images as required, directly fulfilling the expectation that providers "listen to people affected by the incident" to make changes and prevent recurrence.

A joyful elder woman admires her new hairstyle in a handheld mirror, as a young caregiver offers assistance and a warm smile in a serene outdoor setting

Conclusion: A Lighthouse for the Coming Storm

The Commission’s report paints a stark picture of a vital sector at a crossroads. It is a sector serving a large and growing population of vulnerable Australians, yet it is strained by systemic failures in its core operational and governance structures. The profound responsibility owed to the more than 1.3 million older Australians in care demands that we treat these findings with the utmost seriousness. We are facing a gathering storm of rising consumer expectations, profound regulatory change, and intensifying operational pressures. In this environment, the new paradigm of proactive, data-driven, and technology-enabled governance is not just a strategy for improvement; it is the essential lighthouse needed to provide the clarity, foresight, and unwavering guidance required to navigate these turbulent waters and steer the aged care sector toward a future of safety, dignity, and excellence.

Reference

Aged Care Sector Performance Report Q4 2025