By 2030, Cam Ansell’s analysis above says retirement village and residential aged care growth will be flat but villages with assisted living will explode, changing the village business model dramatically.
See in the chart above.
We at DCM Group have been hypothesising the number of ‘village beds’ that will morph into aged care beds within five years will be 100,000. Cam’s 200,000 beds is largely assisted living beds topped up by full service private aged care, both delivered under the Support at Home regulations.
We think we are both right. His assisted living definition is a person who moves out of their family home into a retirement village to receive home care in their village home (or Support at Home from 1 November).
This sounds innocent and deliverable. However, as we travelled from Brisbane to Sydney last week and Melbourne on Wednesday with our Ask The Visionaries Anything breakfasts, we hear the private aged care leaders talking about the level of frailty of residents signing up – all level 3 and level 4 Package recipients, or waiting for them.
These people are not independent. Thanks to 12-plus months waiting for a rare Home Care package, they are already advanced in their care needs. A low effort/low staff assisted living model won't cut it.
Aaron Lavell (pictured right), CEO of Odyssey Lifestyle Care Communities, told us in Brisbane the mid-point of tenure at Odyssey is now just 1.9 years, not the four years most operators budget for.
Aaron also has about one staff member for every three residents, or 70 staff for just over 200 residents. You will need new revenue streams to pay for them.
If you are a village operator strategising that you will move to light levels of care delivered by Home Care Packages, that is the popular assisted living model, be prepared for a shock.
Grant Corderoy (above) tells our private aged care breakfasts that the DMF is likely on the way out and up front membership is the only way to be able to deliver the staff and services this new customer will demand.
And there will be 200,000 of these customers swamping village ‘beds’ in the next 60 months.
In fact, it is happening now. The message? Beware taking on new residents with your old contracts. You may end up responsible for high levels of care with little fresh income.
