As you may have recently discovered, the Retirement Villages Amendment (Asset Management Plans) Regulation 2021 came into effect in February 2021.
For Retirement Village Operators, this means a significant effort to firstly assemble an asset management plan, and then continuously monitor, update and amend it – all while allowing visibility to their residents.
But with our proven process; your organisation can prepare an asset management plan that will satisfy the new guidelines, so you can get back to running your village.
Here is our 5 step guide to preparing an Asset Management Plan.
Step 1: Determine what system you will use for your asset management plan
While excel is a useful tool in this sort of exercise, it is arguably impossible to achieve the level of detailed data and transparent reporting that is required with excel alone. This means that village operators will need to look at utilising asset management or maintenance software for their asset management plan. This type of software is generally referred to as a Computerised Maintenance Management System or CMMS. There is a plethora of CMMS software programs on the market. The key is to find a program that is suited to aged care and is also centred around a detailed asset register. Most maintenance modules in aged care software programs are a simple request and scheduling platform, without the ability to track maintenance tasks and costs against specific assets. That won’t cut it for your asset management plan.
Step 2: Capture the asset data
As the backbone of the asset management plan, village operators are required to maintain an asset register containing all items of capital for which an operator is responsible, that have a purchase cost of $1,000 or more. This does not include consumables. For new villages, the type of asset data that is captured in an asset register should be readily available. However, for older villages, creating an asset register will require a thorough onsite audit of the village to record each and every one of those items.
Usually an asset register for an independent living unit consists of a small list of assets such as an air-conditioner, a hot water heater, an oven/cooktop and rangehood. Most other assets in the unit belong to the resident and are not the responsibility of the operator. However, the requirement is to include all items of capital for which an operator is responsible, that have a purchase cost of $1,000 or more. In addition to what we typically think of as assets, we now need to include capital items such as flooring, roof, fence, wall coverings and much more. This results in a significant volume of assets to be captured.
It is most likely that the asset data will be recorded in excel and formatted to suit the import template for your chosen CMMS.
Step 3: Import the asset data into your chosen system
Before the asset data can be imported, the chosen CMMS will need to be configured for the individual village/s. Each CMMS has a unique structure and should be set up by someone who or only knows the software, but also understands asset management specifically for aged care. Each CMMS systems will also have different import templates that need to be populated – a task that should not be underestimated as it can be quite overwhelming for a new user.
Step 4: Prepare a maintenance schedule for each capital item
Once your asset data is correctly populated in the CMMS, the asset management plan can be developed. This includes:
- Estimating the remaining life of each asset
- Estimating the replacement cost for each asset
- Preparing a 10-year maintenance schedule for each asset
- Preparing a 3-year report for estimated maintenance costs of each asset
- Drafting a policy document describing the methodology used to achieve the Asset Management Plan (A policy document is not specifically required by the regulations or guidelines, but it will provide an excellent basis for making decisions as well as providing additional transparency to the residents which may reduce potential conflicts)
Step 5: Adequately resource the ongoing management of the system
Once your asset management plan is completed and you have been through the 60-day resident feedback period, your plan will need to be managed on an ongoing basis. Someone must assume responsibility for the integrity of the data and incorporate asset and maintenance data from the operator into the asset management plan. The ongoing management will include entering asset acquisitions and disposals, entering actual repairs, maintenance and replacement costs against specific assets, updating estimates and tracking changes that will trigger the need to notify residents.
With our vast experience in asset management for aged care and retirement villages, we can certainly see some interesting hurdles and inconsistencies in the elements required by the regulation and guidelines. However, increasing the importance and value placed on asset management is a great thing and we will work with the guidelines to facilitate value add asset management planning for our clients.
If your organisation doesn’t have the resources to implement and manage your asset management plan in-house, consider engaging the asset management experts at MDFM.
What about Residential Aged Care Facilities?
While the latest amendment relates to Retirement Villages, MDFM also provides asset registers, asset management plans and computerised maintenance management for many residential aged care providers. It’s what we do every day!