The first report from the ARFC on the financial health of the aged care sector under the Living Longer Living Better legislation states the sector will receive an additional $3B in funding over the next 36 months, but doesn't really say how.
It infers this will be for new beds, but at an average $225,000 per bed, this equates to 4,443 beds a year when operators are not taking up licenses. It is also a 7% increase in beds on the country's total of 185,000 beds. Additionally it states that over the next decade we will need a further 74,000 beds which will require $25B in investment - or $338,000 per bed.
Again, it does not explain where the cash will come from. It says Government has a target growth each year in funding of 2-3% above the indexed rate but that did not materialise this past year. The average bond at present is $230,000, so that wont cover it. And as the report points out, 30% of care operators are making no profit or losing money each year. Banks are not rushing to provide the funds. Something is not right.
