More nursing home closures inevitable, warns report
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More nursing home closures are inevitable unless a funding crisis in the sector is tackled urgently, the Government has been warned.
The stark warning from Nursing Homes Ireland (NHI) comes as it publishes a major new report today which lays bare the challenges facing a sector where, against the backdrop of soaring costs and marginal funding increases, 31 private and voluntary nursing homes have closed in the last three years with the loss of 915 beds.
NHI commissioned PwC to examine the challenges and to recommend solutions to stem the flood of nursing home closures, and its findings, published today show:
- There has been a 36% increase in the operational cost of care per resident since 2017;
- Development costs per bed have surged 47% since 2017;
- 33% of nursing homes surveyed posted an operating loss in 2022 — up from 19% in 2021.
To prevent further nursing home closures, the report calls for the immediate sanctioning of more funding for the National Treatment Purchase Fund (NTPF), which negotiates on behalf of the State the rates paid to nursing homes.
But it also recommends reform of the Fair Deal pricing mechanism to enable the rates to be based on resource allocation and on a resident’s individual care needs.
NHI chief executive, Tadhg Daly, said the sector is in a state of “crisis and contraction” and the report must serve as a “further wake-up call for Government”.
“This has been particularly prevalent among smaller operators in rural areas to date, but will encapsulate medium-sized and larger operators if the status quo prevails. Urgent intervention is required,” he said.
“It is becoming increasingly unfeasible to operate a nursing home in Ireland, due to rapidly rising costs and only very marginal increases in income stream — which is the result of a Fair Deal Rate pricing mechanism no longer suitable for the current operating environment.”
The report comes two days after relatives of the latest nursing home caught up in the funding crisis protested outside the Tánaiste’s office in Cork City.
The families of the 56 Fair Deal residents at CareChoice’s Beaumont Residential Care (BRC) pleaded with him and the Government to resolve the funding shortfall.
CareChoice CEO Stuart Murphy told the on Tuesday that BRC has now withdrawn from the Fair Deal scheme, leaving the home’s 56 Fair Deal residents facing an uncertain future.
He said the group, which recorded a €6m loss last year, will cover their care costs for another month but would then only be able to support their families as they source alternative accommodation for their loved ones.
“The Irish private nursing home sector is falling over behind closed doors,” he said.
“I have sought meaningful engagement with the NTPF for the last seven to eight months on a group level to discuss the Fair Deal funding issue.
"But they are not willing to engage with us at a group level. We’ve been told we have to negotiate on a home-by-home basis."
Mr Murphy said he has tried 14 times in recent weeks — by sending seven letters and seven emails — to get a meeting with the NTPF, all without success.
“Their behaviour to date has been problematic and shameful in some ways,” he said.
A spokesperson for the NTPF said as part of its normal processes, the NTPF is "always available to continue negotiations with individual nursing homes".
"We keep open lines of communication and regularly communicate with all those nursing homes we negotiate with,” she said.