Almost 200 residential aged care providers with more than 30,000 residents have insufficient funds to cover their liabilities, according to a new analysis by Leading Age Services Australia.
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The revenue of three-listed aged care providers has increased but so have costs including for the aged care royal commission, StewartBrown’s latest analysis shows.
Four in five providers are struggling to deliver the care clients expect and many say they will have to reduce services, staff and investment if financial conditions worsen, aged care CEOs say.
Regulatory changes and funding pressures have led to the “disturbing statistic” that more than 42 per cent of residential facilities are operating at loss, StewartBrown says in its half-yearly report on the financial performance of the aged care sector.
The proportion of aged care facilities operating at a loss has increased by more than 11 per cent over 12 months with those in rural and remote areas faring the worst, StewartBrown’s year-end report on the financial performance of the aged care sector shows.
The home care sector has experienced a more than six per cent decline in profitability over the last year as providers continue to accumulate a growing mountain of unspent funds, a key financial report has found.
The results for the nine months ending 31 March 2018 indicate the financial performance of residential aged care facilities is continuing to deteriorate, StewartBrown’s new quarterly benchmarking report shows.
The proportion of aged care facilities reporting a loss has grown from 34 to 41 per cent in six months, according to StewartBrown’s latest benchmarking report, which found an increasing number of financially vulnerable facilities.
Declining occupancy, rising staff costs and a fall in revenue are behind the lacklustre financial performance of the three-listed aged care companies, analysis shows.
For the first time the survey will analyse balance sheet data as well as looking at major trends and operational benchmarks.
The results from the latest Stewart Brown aged care survey show the average facility has a total net loss.