Aged care profits jump 159% in one year

An annual survey by Bentleys Chartered Accountants has revealed that aged care homes more than doubled their profitability on average last year; in large part by cutting the hours of care delivered by RNs.

Bentleys National Aged Care survey, which benchmarks the profitability of the aged care sector, has been conducted for 20 years. The survey covers 179 homes around Australia.

The 2013-14 survey found that net profits had jumped 159 per cent, from $4.14 to $10.71 per resident per day. The results were outlined in a presentation given in Brisbane last October and obtained by Crikey.

The survey found that the average nursing home spent $99 per resident per day on nursing and care, mostly wages. The most profitable operators, however, spent six per cent less – just $92 per resident or 40 per cent of revenues.

The presentation noted that providers had found “efficiencies” mainly through a steady trend away from reliance on nurses towards personal care assistants.

A chart showed the long-term decline in the time spent on care by registered nurses, which fell from 5.9 hours per patient per fortnight in 2004, comprising 17 per cent of total care staff hours, to 5.2 hours or 13 per cent of total hours in 2014.

The amount of time spent by personal care assistants jumped from 11.4 hours in 2004 comprising 31 per cent of total care staff hours, to 16.8 hours or 39 per cent of total hours in 2014.

Bentleys describe aged care as “a growth industry underpinned by government subsidies and an ageing population”.