The Australian residential aged care sector stands at a pivotal juncture of transformation, with digital technology playing an increasingly critical role in improving care quality, operational efficiency, and regulatory compliance.
Following the Royal Commission into Aged Care Quality and Safety's recommendation for "universal adoption of the aged care sector of digital technology and My Health Record", the Australian Government has committed substantial funding to modernise the sector. With an overarching $18.3 billion five-year reform package and specific allocations like the $966.5 million Aged Care Capital Assistance Program, significant opportunities exist for aged care providers to secure funding for strategic IT initiatives.
This comprehensive guide provides a framework for residential aged care providers to develop, prioritise, and prepare technology projects that align with both organisational needs and government funding priorities, ensuring they are positioned for success when grant opportunities arise.
The aged care sector is experiencing unprecedented change as digital reforms reshape service delivery models and regulatory frameworks. This transformation can no longer be considered optional but is increasingly mandatory as new compliance requirements emerge under the Aged Care Act 2024.
From July 1, 2025, significant digital system uplifts are required across the aged care sector in line with the new Aged Care Act 2024 and the Support at Home program. The Australian Department of Health's digital transformation agenda aims to modernise aged care by making it "better-connected, automated, sustainable and bringing person-centred care to the forefront". This transformation involves multiple interconnected initiatives, from improving digital literacy among older Australians to implementing sophisticated clinical care systems.
Recent research by the Aged Care Industry Information Technology Council (ACIITC) highlights both the challenges and opportunities associated with clinical care software adoption in residential facilities. Their report identifies barriers including "diversity of the current technology infrastructure in residential aged care facilities" and integration challenges with systems like My Health Record. At the same time, it emphasises opportunities for enhanced care planning and improved data collection through strategic technology investments.
The Commonwealth Government has clearly signaled its commitment to digital transformation through multiple funding streams. The Department of Health is currently implementing 23 specific actions and initiatives under the Aged Care Data and Digital Strategy, including developing aged care digital design standards, supporting virtual nursing, delivering e-prescribing services, and integrating aged care support plans with My Health Record.
Additionally, the Business to Government (B2G) project is working with aged care providers and software vendors to "develop, design and test improved aged care ICT platforms and systems that connect and integrate better". This initiative directly supports the Royal Commission's recommendations for government investment in technology systems.
Understanding these priorities is essential for developing IT projects that not only address organisational needs but also align with government funding focus areas, substantially increasing the likelihood of successful grant applications.
For residential aged care providers, strategic alignment means ensuring technology investments simultaneously address operational needs, enhance care quality, and support compliance with evolving regulatory requirements.
Before developing new IT project proposals, aged care providers should have (or conduct!) a comprehensive assessment of their existing technology landscape. The ACIITC's research highlights the "diversity of the current technology infrastructure in residential aged care facilities" as a significant factor affecting digital adoption. This assessment should evaluate:
This assessment provides the foundation for identifying gaps and opportunities that strategic IT investments can address.
The next step is mapping potential IT projects to specific reform objectives prioritised by both the organisation and government funding bodies. The Department of Health has outlined several focus areas for digital transformation, including:
IT projects that explicitly address these priorities demonstrate stronger alignment with government objectives. For example, a project implementing advanced medication management software could be positioned as supporting both "maximising time for direct care" by reducing administrative burden and "strengthening care connections" by improving communication between care staff and healthcare providers.
The Macquarie University research project "Transforming residential aged care through evidence-based informatics" highlights that "Digital systems in residential aged care (RAC) have enormous potential to improve medication management, reduce the workload of aged care staff, and support quality care". Projects that build on these established benefits will be particularly compelling.
With limited resources and multiple funding opportunities, residential aged care providers must employ a structured approach to prioritising technology initiatives - where internal resourcing is not available to progress applications in an appropriate manner, consideration must be given to acquiring per-grant consulting resources to ensure that applications are compliant, on-time and cover the required areas.
While standard prioritisation frameworks provide a useful starting point, the unique characteristics of the aged care sector require additional considerations:
By July 2025, aged care providers will need to "update their digital interface" to meet new requirements under the Aged Care Act 2024. Projects that support this transition should receive higher priority, particularly if they address multiple compliance requirements simultaneously.
The staged approach to digital transformation announced by the Department of Health suggests that providers should develop a portfolio of projects spanning different timeframes and complexity levels:
This balanced approach ensures providers can respond to immediate requirements while also positioning themselves for long-term competitive advantage and improved care delivery.
The concept of "shovel-ready" is particularly relevant for aged care providers seeking government funding, as grant programs increasingly prioritise projects that can be implemented quickly and demonstrate rapid benefits.
For IT projects in residential aged care, being "shovel-ready" means having completed all preliminary work necessary to begin implementation immediately upon receiving funding. This typically includes:
Business cases for aged care IT projects must clearly articulate both the strategic value and practical benefits of the proposed investment. Key components include:
For projects seeking government funding, business cases must directly address specific grant criteria. For example, the Aged Care Capital Assistance Program (ACCAP) prioritises maintaining or increasing access to quality aged care services in "thin market settings" and for specific populations including Aboriginal and Torres Strait Islander communities - such requirements need explicit language to ensure bid compliance!
Accurate cost estimation is essential for both budget planning and grant applications. For residential aged care providers, comprehensive cost capture must consider the unique characteristics of the sector, expected project lifetime and appropriate contingencies.
Capital expenditure for aged care IT projects typically includes:
When applying for capital grants like the ACCAP, providers should clearly identify which costs fit within eligible categories. The ACCAP guidelines, for example, specify that grants can be used for "maintenance and efficiency upgrades" and "safety and amenity improvements", which could include technology infrastructure.
A critical consideration for aged care providers is the ongoing operational cost of new technology systems. These expenses typically include:
Grant applications should clearly distinguish between one-time implementation costs (potentially covered by government funding) and ongoing operational expenses (typically borne by the provider). This transparency demonstrates financial sustainability and increases confidence in the project's long-term viability. Care must also be taken to ensure that mandatory "subscriptions" needed as part of the initial installation are identified and included within the Capital costs - renewals of such subscriptions in the years following deployment then fall into operational expenditure.
A compelling component of financial planning for aged care IT projects is identifying efficiency gains and cost offsets. These might include:
The Business to Government (B2G) project explicitly aims to "reduce administrative burden for providers" through better technology connections. Projects that demonstrate alignment with this objective can highlight these efficiency benefits in funding applications.
As of early 2025, there are several grant programs specifically targeting aged care infrastructure and technology improvements. available to Australian providers. Understanding these opportunities can help providers align their strategic IT initiatives with available funding sources.
The ACCAP represents a significant funding opportunity for residential aged care providers, with $966.5 million allocated over four years to June 2028 and at least $161 million available annually thereafter. While traditionally focused on physical infrastructure, ACCAP grants can support technology projects that enhance care quality and service delivery.
The next ACCAP grant opportunity is anticipated to open in the first half of 2025, with a focus on projects that "maintain or improve access to quality residential-based aged care services" in regional, rural, and remote locations, as well as metropolitan locations serving Aboriginal and Torres Strait Islander people.
Providers interested in this funding should register with GrantConnect to receive notifications about upcoming opportunities and review the specific guidelines for each round, as eligibility criteria and priority areas may vary.
Beyond capital infrastructure grants, providers should monitor funding opportunities related to the government's digital transformation agenda. The Department of Health is implementing numerous initiatives under the Aged Care Data and Digital Strategy, many of which involve collaboration with providers and technology vendors.
The Business to Government (B2G) project specifically aims to develop "improved aged care ICT platforms and systems" through collaboration with providers and software vendors. Engaging with these initiatives can provide valuable insights into government priorities and potential funding opportunities.
The following comprehensive checklist provides a framework for residential aged care providers developing strategic IT projects positioned for government grant funding:
Evaluate current technology infrastructure against aged care quality standards and reform requirements
Identify gaps in clinical care systems, data collection, and reporting capabilities
Map proposed IT initiatives to specific aged care reform objectives
Align projects with recommendations from the Royal Commission into Aged Care Quality and Safety
Secure executive sponsorship and engagement from clinical leadership
Develop prioritisation criteria addressing regulatory compliance, care quality, and workforce efficiency
Assess projects based on implementation complexity, risk profile, and resource requirements
Balance portfolio with immediate compliance needs and long-term transformation initiatives
Consider integration capabilities with existing systems and external platforms like My Health Record
Regularly review priorities as regulatory requirements and government funding focus areas evolve
Develop detailed project plans with implementation timelines aligned with funding cycles
Prepare technical specifications and integration requirements
Identify potential technology vendors with aged care sector experience
Engage stakeholders including care staff, residents, and families
Develop risk management strategies addressing aged care-specific implementation challenges
Create comprehensive change management and training plans for the care workforce
Document all capital expenditure requirements eligible for grant funding
Calculate ongoing operational costs and identify funding sources
Quantify efficiency gains, cost offsets, and care quality improvements
Secure financial approval for both grant-funded and provider-funded components
Develop contingency plans for funding shortfalls or implementation challenges
Monitor upcoming aged care grant opportunities through GrantConnect
Prepare standardised project information aligned with common grant criteria
Develop relationships with relevant government agencies and industry bodies
Establish internal processes for rapid response to funding announcements
Build capability in grant writing with specific focus on aged care priorities
The digital transformation of Australia's residential aged care sector represents both a significant challenge and an unprecedented opportunity. With substantial government funding available through programs like the Aged Care Capital Assistance Program and various digital transformation initiatives, providers have a unique window to secure support for strategic technology investments.
The key to success lies in thorough preparation and strategic alignment. By developing a portfolio of "shovel-ready" IT projects that directly address both organisational needs and government priorities, residential aged care providers can position themselves to capitalise on funding opportunities as they arise. This proactive approach not only enhances the likelihood of securing external funding but also strengthens the organisation's capability to navigate the evolving regulatory landscape and deliver improved care outcomes.
As the July 2025 deadline for digital system uplifts approaches, the imperative for strategic action becomes increasingly urgent. Providers who invest in careful planning, comprehensive cost analysis, and detailed implementation preparation will find themselves ready to respond when funding opportunities arise, while others scramble to catch up.
By following the framework outlined in this article, residential aged care executives and IT leaders can ensure their organisations are well-positioned to leverage government funding for strategic IT initiatives that enhance care quality, improve operational efficiency, and support compliance with evolving regulatory requirements. This approach delivers lasting value not only to the organisation but, most importantly, to the older Australians who depend on these services for their care, dignity, and quality of life.