In this story:
- High approval rate for applications to pricing commissioner: report
- Telstra buys iCareHealth
- Estia announces IPO
High approval rate for applications to pricing commissioner: report
The Aged Care Pricing Commissioner approved 379 applications to charge accommodation prices above $550,000 last financial year and the average processing time was 30 days, according to the commissioner’s inaugural annual report tabled in Parliament.
No applications to the commissioner were refused, but a number of applications were reframed, the report to the Assistant Minister for Social Services Mitch Fifield said.
Commissioner Kim Cull said this reflected an approach to working with aged care providers to facilitate the approval of applications “where possible”, to seek further information or to identify where applications are not likely to succeed as currently framed.
In the period since the opening of applications from 31 January 2014 to 30 June, 446 applications were lodged with the commissioner. Of these, 379 (85 per cent) were approved during the financial year.
The pricing commissioner has 60 days to approve or refuse an application. However, on average the commissioner assessed and notified providers of a decision in half that time, the report said.
In many cases, the commissioner sought further information to complete an assessment of an application outside the parameters of a formal request.
Read the full report at the Aged Care Pricing Commissioner’s website.
Telstra buys iCareHealth
Telstra Health has acquired large aged care software provider iCareHealth, Telstra Health managing director Shane Solomon announced on Monday.
iCareHealth is a market leader in clinical care management and medication management software in the aged care sector.
Mr Solomon said the acquisition would help Telstra Health achieve its broader vision in eHealth. “We are excited to add iCareHealth and the expertise and capability that they bring to our team. Their nimbleness, innovation, creativity and expertise will be a strong addition and we are delighted that their key personnel will come across with the company,” he said.
iCareHealth managing director Chris Gray said the transaction would provide the company with unrivalled scale and stability as the sector undergoes significant growth.
“With the vision and support of Telstra, we will be able to provide greater integration across the sector to improve point-of-care service and drive productivity gains.
“Furthermore, as part of Telstra, our increased scale will ensure we are best placed to provide software that eases the burden of increasing regulation and compliance for providers of aged care services,” said Mr Gray.
Estia announces IPO
Private equity-owned aged care operator Estia Health is preparing to launch an initial public offering in early December, which will see it become the third aged care provider to list on the ASX in less than 12 months.
The 3,200-bed provider was established this year through the merger of three aged care providers – Lasting Changes, Padman Health Care and Cook Care Group – and is expected to raise between $528 million and $834 million from its market listing.
Estia is Australia’s fourth largest private provider, currently operating 39 facilities across Victoria, South Australia, NSW and Queensland. By February 2015 it will add a further 410 places at five facilities to its portfolio. Some 34 per cent of places are currently dedicated extra service places.
According to the prospectus lodged with the Australian Securities and Investments Commission on Monday, the offer is being conducted to repay existing debt, pursue its growth strategy and allow existing shareholders to realise part of their investment in Estia. Private equity firm Quadrant currently has a 58 per cent stake in the company. Quadrant and the company’s other shareholders have agreed to sell up to 50 per cent of their existing shares.
Estia chairman Patrick Grier told potential investors following the IPO the organisation will be well-positioned to expand through acquisition in the four states in which it operates, leverage existing infrastructure and build new facilities to meet growing demand for residential aged care.
Estia’s facilities are primarily located in metropolitan areas with above average socio-economic backgrounds which provides a competitive advantage, the prospectus said. Estia’s current average advertised Refundable Accommodation Deposit at 29 July 2014 was approximately $310,000, which is below industry average.
The trading of shares is expected to commence on 5 December.