The residential aged care sector lost an average of $32.97 per resident per day in 2021-22, according to the latest Financial Report on the Australian Aged Care Sector 2021-22. The sector as a whole lost $2.26 billion.
The 148-page Report reveals that residential care providers actually made a $19.36 profit per resident per day on care, which is funded by the Federal Government, but a $14.86 loss per resident per day on accommodation and a $43.02 loss on administration, which is not funded by the Government, dragged the overall result into the red.
The care result was also down $5.78 per resident per day from 2020-21, due to higher labour costs.
The accommodation loss mainly reflected the amortising of bed licenses ahead of the 1 July 2024 end of the Aged Care Approvals Round (ACAR), as well as COVID-19-related expenses of a loss of $6.37 per resident per day.
Providers self-reported $742 million in COVID-19 grants claimed but not yet approved or paid.
Overall, the profitability of residential aged care has declined steadily over the last five years.
OCCUPANCY
The continued decline in occupancy also eroded profitability. Average occupancy across all residential care places was 86.2% in 2021–22, down from 86.8% in 2020–21, and 88.3% in 2019–20.
There has been a consistent decline in occupancy rates over the past five years.
CARE MINUTES
Average care minutes increased by 4.9 minutes, with Registered Nurse minutes increasing by an average of 1.80 minutes to an average of 33 minutes. The Department of Health and Aged Care said that it expects this trend to continue in 2022–23 as AN-ACC funding will help to cover the expenses and as care minute targets become mandatory from 1 October 2023.
You can read the Report here.
The SOURCE: The Report notes financial improvements have been seen in the sector since the introduction of AN-ACC on 1 October 2022. However, StewartBrown had forecast that this uplift is only likely to be short term with mandated direct care minutes just six weeks away.
