Australia’s aged care peak bodies have issued an urgent plea to the government for “urgent funding” to avoid a crisis in the aged care sector.

According to a survey conducted by the peak bodies, around 15 per cent of aged care providers say they may need to close their doors within the next 12 months.

According to the latest StewartBrown report, 53 per cent of aged facilities are operating at a loss. 

And analysis by Leading Age Services Australia (LASA) last month suggests almost 200 residential aged care services, providing care for up to 50,000 people, are at “unacceptably high levels of financial distress”.

The peak bodies banded together are Aged and Community Services Australia (ACSA), Anglicare Australia, Baptist Care Australia, Catholic Health Australia, Leading Age Services Australia (LASA), The Aged Care Guild and UnitingCare Australia.

The group is urging the government to address the risks facing the aged care sector in the Mid-Year Economic and Fiscal Outlook (MYEFO).

$500m “tip of the iceberg”

The government’s recent announcement of $500 million for aged care addresses “only the tip of the iceberg” and is “insufficient to support senior Australians today,” the group said in a statement.

“We are working and standing together to ensure every older Australian in need receives the highest quality of care, without failure.

“The fact is, without further investment, residential facilities – and associated home and community care services – will be lost in the next twelve months,” they said.

The group says the aged care sector can not afford to wait until after the completion of the Royal Commission into Aged Care Quality and Safety.

“We can’t wait it out”

“We don’t think we can just wait it out,” ACSA CEO, Pat Sparrow, told HelloCare.

She said the industry doesn’t want to find itself in a situation where aged care residents are not able to receive the services they need.

Costs in aged care are rising more quickly than revenue, she said, and “it’s going to get worse”.

“We are very concerned,” she told HelloCare.

Families will lose everything

Anton Hutchison, owner of the family-run Canberra Aged Care, told HelloCare urgent action is required.

Sixty-three per cent of aged care operators only have one facility, he said. If that operation fails, “they have lost everything they’ve ever worked for”. Aged care facilities have been changing hands for as little as $1, he said.

Often aged care facilities, such as his own, employ not only a number of staff, but family members too.

Mr Hutchison’s son works in the family business. “He’s worked his butt off and we still can’t pay the bills”, Mr Hutchison said.

The facility is losing $45-$50,000 a month. Despite working in their facility, Mr Hutchison and his wife have not drawn a salary for two years. 

“The way the system is going, we’ll have a Coles/Woolworths duopoly, and then we’ll really have something to complain about,” he told HelloCare.

“We’ve got to do something,” Mr Hutchison said. He suggested “civil disobedience” or strike action may be needed to stir the government into action. “I’m at a loss. It’s quite devastating,” he said.

“This is a crisis”

LASA General Manager Policy and Advocacy, Tim Hicks, told HelloCare that more funding rather than structural change is needed to “keep the ship afloat”.

With the royal commission underway, it was important not to move the goalposts, but if we start to see facilities closing, “that’s going to change the way services are delivered”, he said.

“This is a crisis,” he said, especially in rural and remote areas.

With Aged Care Minister Richard Colbeck saying the government won’t increase funding without getting something in return, Mr Hicks said the industry is ready to have the conversation about what that might mean.

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