Bupa to face another aged care loss this year – but CEO Hisham El-Ansary says millions spent to get business back on track

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Bupa’s Australia and New Zealand chief executive Hisham El-Ansary has detailed how the operator is working its way back from the hit to its reputation from the Royal Commission and last year’s financial loss in a revealing interview with The Australian.

As we covered here, Mr El-Ansary (pictured above) joined Bupa in April 2019 after 11 years in a number of roles at the company including Managing Director of the Health Services business as well as leading its strategy, M&A and business development.

At the time, the operator was facing its ninth sanction, culminating in a case study on its South Hobart home at the Royal Commission’s Hobart hearings in November which identified a number of governance issues that had impacted on residents’ care.

Aged care division needed to change its culture, CEO says

In the article, Mr El-Ansary conceded that the operator’s aged care division had “lost its way” with 20% of its homes facing sanctions.

“One of our key priorities was to get the business back on track and restore our credibility and reputation,” he said.

“We went through everything, hiring a new executive managing director, new executive team. We went through each part of the business step by step to work out what went wrong.”

“We had lost some of that discipline that is a key feature to running any clinical business. At the end of the day it is about changing the culture and that takes time.”

Millions of dollars invested into aged care homes

Bupa has since invested “tens of millions [of]dollars” into the business, including into stronger clinical oversight, improved staff training, enhanced internal auditing, a new management structure and quality of food.

However, it will record another loss this year following a $72 million loss in 2019-20.

Like many operators, Bupa has seen its occupancy falls thanks to COVID. Four of its 72 aged care homes were affected by outbreaks, with 22 deaths recorded.

Mr El-Ansary added that while its size means Bupa can cross-subsidise its aged care operations, its aged care business will need to return to profitability in the future.

Wealthier residents should be able to pay more

The CEO told the paper he hopes the Royal Commission will now deliver reform, including allowing wealthier residents to contribute more to the cost of their care.

Despite the challenges, Mr El-Ansary says Bupa did not consider divesting its aged care homes, which only make up a small of its business.

“I wanted to do the hard yards,” he said.

Bupa has sold three of its aged care homes in recent months however – its South Hobart facility to Southern Cross Care Tasmania and its two Canberra aged care homes to Warrigal last week.

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