We’re not – is the bottom line. And it’s now serious. The worrying statistics quoted in this article bring home the financial reality of what’s now facing the care industry.
With as many as one third of the industry classed as financially 'at risk', that means nearly 100,000 care home residents face uncertainty about their provider being able to continue operating as sustainable businesses. Part of the Care Quality Commission (CQC)'s function is now to assess the financial viability of the large providers, like Four Seasons whose 2015 results have caused concern this week.
Care homes need better financial stability and that comes from a variety of different factors, including reductions in debt and better financial management. But expecting financial wizardry from an industry whose primary function is - above all – to be caring seems unrealistic.
This article flashes yet one more warning light alerting the government to the vital need to act whilst there is still time to re-structure the model and make private sector care provision sustainable. If the private sector fails, the ultimate burden will fall on the tax payer and that will mean local authorities and the NHS having to step in, which also seems unrealistic.
It seems that a urgent review of the sector needs to take place with a view to creating a plan for sustainability. This might take the form of offering assistance in debt management or restructure, or tax breaks for the sector to help providers absorb the costs of running their services. But it’s foolhardy simply to say that they’re private businesses and so should be left to their own devices.
13% of care homes are “zombie operators” that pay more in interest and servicing their debt than they make in profits. And a total of 5,600 care homes are classed as “at risk”, almost a third of the roughly 18,000 in the country.