More evidence of declining returns

Raw data from an aged care industry survey shows that the returns for the sector are continuing to decline overall.

The preliminary findings from the 2008 Bentleys Aged Care Survey show that the EBITDA [Earnings Before Income, Taxation, Depreciation and Amortisation] have decresased as a whole.

The survey collected information from over 230 homes across Australia, with participants providing extensive details on operating income, government funding, resident classifications, staffing arrangements and management structures.

“The overall initial findings are in line with the general feeling in the industry that aged care services are facing increasingly challenging financial times,” said the director of Bentleys’ health and ageing business unit director, Heath Shonhan.

However Mr Shonhan warned that changes, such as the transition from the Resident Classification Scale (RCS) to the Aged Care Funding Instrument (ACFI), made it difficult to compare the data with previous years.

“Measuring performance in the sector now compared to performance twelve months ago is extremely complicated,” he said.

“In this year’s survey we have made adjustments to the arbitrary grouping of services into different benchmarks for greater relevance.”

“This means that in some areas, comparing results this year to those of last year is not as straightforward as looking across the bottom line from one year to the next.”

The complete data set has not been made public but it has been given to participants for their own analysis.

Mr Shonhan had no further comment to make about the findings but he said Bentleys is currently preparing an industry report which is “due for release in coming weeks”.