Government’s stimulus package leaves little for aged care – is consolidation the key to saving the sector?

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Yesterday, we looked at the positives to come out of the Government’s $17.6 billion stimulus package (announced by Prime Minister Scott Morrison, pictured above) – today, the negatives.

The package has evaporated all its hopes of a surplus – and with it, the chance of further funding for aged care.

Just a week ago, we were talking about 200 providers facing the prospect of closing their doors and $1.3 billion and more Home Care Packages being urgently needed to stave off the sector’s slow death in the next 18 months.

The sad fact is that aged care doesn’t deliver votes.

In the coming months, aged care providers will need to increase their staffing, employ more agency staff and use more suppliers and services to cover existing staff pulling away from aged care and the coronavirus.

They will also need to meet the Government’s requirement on infection control and extra nurses and carers across both residential care and home care.

100 facilities are also being targeted by the Aged Care Quality and Safety Commission – with any improvements required to increase their costs – while the new funding will mean all providers face increased regulation and oversight – adding to their ‘bureaucratic spaghetti’.

There must be a tipping point where the sector has to say: we may be a part of the problem, but we must come up with the solution.

It is time for serious conversations about the consolidation of the country’s 800 aged care operators.

Providers tells us they can only be viable if they make over $100 million in revenue.

In the wake of the coronavirus, diversion of funding and the reforms that will come out of the Royal Commission, we need to start looking seriously at amalgamation and acquisition.

These are the kinds of conversations that were to happen at the 2020 LEADERS SUMMIT in Sydney, 26-27 March.

The SUMMIT has now moved to ‘Plan B’ – an intense program of professional video podcast conversations (and networking lunches).

Multiple TV production teams will produce real, uncut conversations on why the system is broken, what the future of aged care could be and the steps that need to be taken to get there.

These discussions will be delivered as tightly formatted, digestible 15-minute podcasts and will deal with a range of confronting ideas, including:

Aged care

1.            Can the Government afford to increase aged care funding?

2.            Will your employer exist in 2025 if 90% of operators close?

3.            Will your job exist in this streamlined, rationalised new world?

Retirement villages

4.            Will the village sector grow or stall in a housing recession?

5.            Will banks fund the refurbishing of 25-year-old villages?

6.            Will new business models steal Baby Boomers?

Leadership

7.            Does your leadership have the vision to navigate to 2025?

8.            Does your leadership have the skills to lead?

9.            Does your board have the skills to govern?

Serious questions – that need to be answered, for the sector by the sector.

I will keep you informed.

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