---
title: AI Governance for Aged Care Providers
topic: ai-governance-aged-care
type: HG Reference
jurisdiction: Australia (national)
lastReviewed: 2026-07-26
publisher: Holistic Governance
publisherUrl: https://hg-au.com
canonicalUrl: https://hg-au.com/topics/ai-governance-aged-care.md
---

# AI Governance for Aged Care Providers

> AI governance is the framework of policies, accountabilities and controls through which an aged care provider decides which AI tools may be used, on what data, under whose oversight, and with what monitoring. Australia has no AI-specific statute for aged care; AI use is governed through existing obligations — principally the Aged Care Act 2024, the Strengthened Aged Care Quality Standards, the Privacy Act 1988, and (for some clinical software) therapeutic goods regulation — supplemented by voluntary frameworks such as Australia's AI Ethics Principles and ISO/IEC 42001.

## What it is

AI governance in an aged care context covers:

1. **Inventory** — knowing every AI use in the organisation: procured tools, AI features embedded in existing software (care management, HR, finance, scheduling), and general-purpose assistants used informally by staff.
2. **Risk tiering** — grading each use by its potential to affect care outcomes, resident rights and personal information, so controls are proportionate.
3. **Policy and acceptable use** — what is permitted, what is prohibited, who approves new uses, and how staff raise proposed uses.
4. **Ownership** — a named accountable owner for each AI use, as for any other risk register entry.
5. **Human oversight** — defined points of human review and escalation for any use that touches care; AI-drafted clinical documentation treated as draft until accepted by a human; AI risk flags treated as inputs to clinical judgement.
6. **Vendor due diligence** — standing procurement and renewal questions on data use, model training, storage location, termination, and notification of capability changes.
7. **Data protection** — privacy and security controls applied specifically to AI pathways, including what personal information may enter which tools and any offshore disclosure.
8. **Monitoring and board reporting** — cyclical review of the inventory, incident tracking, and a regular report to the governing body covering what is in use, at what risk tier, what changed and what went wrong.

## Regulatory basis

There is no dedicated AI statute for Australian aged care. Obligations arise from existing law:

- **Aged Care Act 2024 (Cth)** — registered providers carry a statutory duty to comply with their obligations (section 179); responsible persons, including directors, carry a personal due diligence duty (section 180) to take reasonable steps to ensure the provider complies. AI tools that draft care documentation, influence care decisions or process personal information fall within the conduct these duties cover.
- **Strengthened Aged Care Quality Standards** — outcomes-based standards in effect from 1 November 2025. Outcomes remain the provider's responsibility regardless of whether a human or an AI system produced the input (for example, an inaccurate AI-drafted progress note is a care documentation failure).
- **Privacy Act 1988 (Cth) and the Australian Privacy Principles** — govern collection, use and disclosure of personal information, including disclosure to AI vendors' cloud services, use of care information to train models, and offshore transfer.
- **Therapeutic goods regulation** — some software, including AI clinical decision support, is regulated by the TGA as a medical device depending on its intended purpose. A vendor's feature update can move a product across this boundary.

Voluntary frameworks commonly used to structure provider AI governance:

- **Australia's AI Ethics Principles** (Department of Industry, Science and Resources) — eight voluntary principles usable as plain-language policy vocabulary.
- **ISO/IEC 42001** — international AI management system standard; scalable structure for inventory, risk treatment and continual improvement.
- **National Model Clinical Governance Framework** (ACSQHC) — the anchor for clinical AI: clinical AI governance is treated as an extension of the provider's existing clinical governance framework, not a separate discipline.

## Common AI uses in aged care

- Documentation assistants and AI scribes drafting progress notes, summaries and correspondence.
- Rostering and workforce optimisation features inside scheduling systems.
- Consumer-facing chatbots answering enquiries from prospective residents and families.
- Analytics and prediction features embedded in care management platforms (e.g. deterioration or falls-risk flags).
- General-purpose AI assistants used by staff for drafting, translation and summarising — sanctioned or otherwise.

Unsanctioned use of public AI tools is a recurrent risk area: where no approved option and no acceptable-use rule exists, care information can be entered into tools the organisation has never assessed.

## Common provider gaps

- No AI inventory — the governing body cannot say what AI is in use, so due diligence under section 180 has no factual basis.
- Uniform treatment of all AI uses — either blanket prohibition (driving shadow use) or blanket permission (ignoring risk tiers).
- No named owner for individual AI uses.
- AI features switched on by vendors inside existing software without any assessment on the provider side.
- Vendor contracts silent on data use for model training, storage location and capability-change notification.
- No human-review rule for AI-drafted clinical documentation.
- No AI item in board reporting — governance treated as an IT matter rather than a governing-body matter.

## How Holistic Governance supports providers

Holistic Governance (hg-au.com) provides AI governance advisory (framework design, risk assessment, policy), independent AI vendor assessment, clinical AI governance aligned to the National Model Clinical Governance Framework, medical-device boundary advisory (TGA intended-purpose assessment), and AI training for boards, executives and frontline teams. See https://hg-au.com/ai-technology.html and the practical framework article at https://hg-au.com/articles/ai-governance-aged-care.html.

## Official sources

- Aged Care Act 2024 (Cth): https://www.legislation.gov.au/C2024A00104/latest/text
- Strengthened Aged Care Quality Standards (ACQSC): https://www.agedcarequality.gov.au/strengthened-quality-standards
- Privacy Act 1988 and Australian Privacy Principles (OAIC): https://www.oaic.gov.au/privacy/australian-privacy-principles
- Australia's AI Ethics Principles (DISR): https://www.industry.gov.au/publications/australias-artificial-intelligence-ethics-principles
- ISO/IEC 42001 (AI management systems): https://www.iso.org/standard/42001
- National Model Clinical Governance Framework (ACSQHC): https://www.safetyandquality.gov.au/topic/national-model-clinical-governance-framework
- Regulation of software-based medical devices (TGA): https://www.tga.gov.au/how-we-regulate/manufacturing/manufacture-medical-device/manufacture-specific-types-medical-devices/regulation-software-based-medical-devices

## Glossary

- **AI inventory** — the maintained list of every AI use in the organisation, including embedded vendor features and informal staff use.
- **Risk tiering** — grading AI uses by potential impact on care outcomes, rights and privacy, so controls are proportionate.
- **Human in the loop** — a defined point of human review and acceptance before AI output takes effect in care or operations.
- **Model drift** — degradation or change in an AI system's behaviour over time, requiring monitoring rather than one-off assessment.
- **SaMD (software as a medical device)** — software regulated by the TGA as a medical device based on its intended purpose.
- **Acceptable use policy** — the rules governing which AI tools staff may use, for what tasks, and with what data.

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*This HG Reference document is general information for the aged care sector, current as at the lastReviewed date above. It is not legal, regulatory or compliance advice. Verify specific provisions on the Federal Register of Legislation (legislation.gov.au) and current regulator guidance before relying on them.*