Struggle continues in aged care

WHILE a number of aged care companies in Western Australia profited handsomely on the back of the boom, the sector overall has fallen victim to these economic good times.

An inherent labour shortage, skyrocketing property prices, and a sharp rise in building costs have made it no longer viable for many of the state's aged care service providers to build new capacity.

Of the 1,208 places offered to WA in the latest federal government aged care approvals round, only 536 bed applications were made.

In Victoria, by way of comparison, 1,486 beds were made available but service providers in that state applied for 5,368.

Similarly, in New South Wales, the number of beds sought by aged care facilities (3,251) was significantly more than the 2,106 made available by the government.

Like WA, the ACT, Tasmania and the Northern Territory were all undersubscribed.

Uniting Church Homes chief executive Vaughan Harding said the discrepancies in bed placements across the country were a result of the different competitive landscapes in each state.

"There are no benefits from the boom in the aged care sector in WA; we are falling further and further year after year," he said.

"Demand and competition in Victoria is like nowhere else, they haven't had staff shortages, they have a different IR climate and there's a different demand for their services."

Federal Ageing Minister Justine Elliot described the 2008-09 aged care approvals round of applications as "healthy" and "competitive", saying more than 37,000 new aged care places would be created over the next three years.

"The figures speak for themselves. Make no mistake, this is about preparing for Australia's ageing population and making sure that there are both nursing homes and community care places available for our elderly," Mrs Elliot said.

However, a federal government report has revealed that, between July 2007 and June 2008, twice as many approved providers left the federal government funded aged care industry as entered the sector.

WA's residential aged care providers say the exodus will only get worse unless there is urgent regulatory reform to capital raising capacity.

Baptistcare chief executive Lucy Morris said until the states had greater control of the pricing structure of the industry, aged care would remain on the brink of crisis.

"The sector is at a tipping point which may last for a while and providers of services are under a great deal of stress at the moment," she said.

"Baptistcare will work to continue to try and meet the needs of the community and will continue to grow as appropriate and we're being careful about it, like every other provider."

Many of WA's top aged care providers have resorted to returning bed licences, The Bethanie Group, Uniting Church Homes, Hall & Prior Aged Care Group, The Brightwater Care Group, Southern Cross Care (WA), and Amana Living among them.

Few aged care providers have increased their bed capacity since 2005.

According to the latest WA Business News Book of Lists, Aegis Aged Care Group is the state's top aged care provider, almost doubling from 622 beds in 2005 to 1,247 beds this year.

Applecross-based Baptistcare added 72 beds to its facilities since 2008 and The Bethanie Group increased its number of beds from 1,102 last year to 1,239 this year.