Crisis: Care providers lose money and cannot attract staff to meet regulatory levels

The crisis in Australia's aged care sector is increasing with providers losing money and unable to attract workers to meet coming regulatory staffing requirements.

A report by the University of Technology Sydney shows 63 per cent of aged care homes are operating at a loss compared to 52 per cent last year.

Working with accountancy firm StewartBrown the researchers surveyed providers across 1192 aged care homes looking at their finances for the first half of the 2021 - 2022 financial year. The average daily deficit was $11.34 per resident per day across all homes (more than double the average deficit of $5.33 in December 2020. Approved providers also reported an average total operating deficit of $339k across their aged care and other business streams for the first half of the 2021-22 year (down from a surplus of $544k at December 2020).

Operating results are comparatively worse in smaller homes, those located outside the major cities and homes that serve residents with less complex care needs.

The financial loss has occurred despite the injection of additional funds through the Basic Daily Fee supplement.

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There was slow growth in staffing rates in residential care which increased by only 1.9 per cent over the year before, to an average of 178 minutes per resident per day, well below the sector average minimum standards of 200 minutes that will be mandatory by October 2023.

There was also a 1.6 per cent annual decline in the direct care staffing in home care, to 3.80 hours per client per week, equivalent to 32.6 minutes per day.

The report says the workforce problems are likely to worsen in the coming year with the release of more home care packages and the incoming minimum staffing standards in residential care.

Researchers say the worsening financial situation among providers is the result falling occupancy rates in aged care homes to an average of 91.6 per cent and the end of most COVID-related financial support,despite the ongoing costs of proactive infection control measures.