Crisis in our care homes as three quarters face cash shortfall

David Lily, chief executive of Healthwatch Brighton and Hove, said the viability of the care home sector is of deep concern after Brighton-based law firm Rix and Kay’s released a report stating government funding is dropping sharply.

He said: “This latest report should act as a wake up call to both the government and local authorities that many care homes are likely go under or cease operating unless funding issues are addressed.

Rix and Kay’s report is based on interviews with 46 owners.

They say government funding is dropping sharply at a time when the regulator’s requirements are becoming tougher. than ever.

Their report shows 72 per cent of care providers state funding and cash flow as the biggest problem facing their business.

Meanwhile the owner of two care homes closing next month says there was no choice because of financial pressures.

New Century Care runs 25 homes across the country but has decided to pull the plug on two in Sussex.

Clyde House and Leolyn, both in St Leonards, will shut their doors leaving more than 50 vulnerable people to find alternative places.

Demand for care is soaring because of our ageing population.

Rix and Kay claim many who need to enter a care environment simply do not understand the funding options available.

The industry is being described as in crisis and New Century Care said both homes were not viable.

Their spokesman said: “We have a moral and regulatory duty to make sure our homes are financially sustainable.

A spokesman for New Century, which also closed Tredegar in Upper Avenue, Eastbourne, last year, said: “Despite our best efforts to resolve the situation, given the current national funding climate both homes have been operating below a sustainable financial level with no likelihood that this will improve in the future.

“Our absolute priority is the health, wellbeing and safety of our residents and that we continue providing high-standards of care.

“Over the coming weeks, we will be working very closely with residents, families and the appropriate authorities to find the right new home to meet each individual’s needs.

“We are also consulting with our staff team and will ensure they are fully supported during this time.”

New Century Care also ran the Tredegar in Upper Avenue, Eastbourne, but that closed in the wake of a damning Care Quality Commission report last year. which said the service provided to the 23 patients was unsafe, ineffective and not well led.

The reason for closure was that it was no longer financially viable.

Scott Garner, head of business development at Rix and Kay, said the report provided great insight into the many challenges.

He said businesses are now trying to address many of the financial issues they are facing.

He highlighted the concerns of individuals and their families entering or already in a care environment.

BREXIT AS WELL AS AN AGEING POPULATION CRISIS

CARE homes in crisis is a familiar story throughout the county.

Jenny Essaadi has managed Rivendale Lodge in Prideaux Road, Eastbourne, for the past 11 years and she says the situation is dire.

She said: “Care homes want their beds full – of course they do – but the problems are very extensive and it is only getting worse.

“The cost of the Living Wage increasing again will hit us very hard. It is going up by another 30p in April from £7.20 to £7.50 an hour and the knock-on effect to the bottom line is obvious.

“In East Sussex the average payment we receive is £501.70 per person per week for each resident being funded by a local authority.

“Based on providing care 24 hours a day seven days a week, divide that figure by seven and then again by 24, that means the average pay per hour would be just £2.98, so the figures simply don’t add up.

“Bed blocking is another big issue. Many patients are well enough to leave hospital but there is no care package in place or there is a long wait for the assessment to be done.

“We identified 50 beds locally just before Christmas which could have been filled in care homes for these patients but as far as I am aware only one bed was actually used. That just makes the problem worse.”

Paul Burns is managing director of Victoria Nursing Group based in Dyke Road Avenue, Hove, and he too predicts challenging times.

The group has six homes – three in Hove – and Mr Burns says that while times are tough it is not all bad news.

He said: “There is no doubt that homes which rely on socially funded residents from local authorities face an incredibly tough future.

“It’s pretty challenging if you are relying on fees from the council to make money.

“I have to say that Brighton and Hove City Council has been doing its very best to increase what it pays, but from a business point of view the challenge is to have more privately funded residents if that is possible.

“They will be paying a fair amount more than those funded by the councils.

“I think owners are becoming more savvy about producing effective business plans and the need to make profit than ever before.

“But I do understand the fears of those who look to the local authority for their income.”

Brexit is another issue affecting the care sector.

The possibility of the removal of free movement of workers from EU countries might have a significant effect on the workforce pool, says the report.

And it warns that success in recruitment may be dictated by Government policy as opposed to care sector needs.

The report says: “The potential impact of Brexit on the UK’s economic outlook and the free movement of workers will have given many in the care sector pause for thought.

“Public finances in the post-Brexit world are likely to remain under pressure for longer than anticipated.

“Austerity and cuts to public budgets will increase competition in national and local government for already stretched funds.

“It remains the case that some older savers have suffered disastrous effects on their income.

“No doubt they will be hoping that post-Brexit stock market uncertainties do not reduce their pension pots still further, or indeed lead to business closures that might put pension schemes at risk.”

The growing population is also a big issue. From 2012 to 2032 the population of 65-84 year olds and the over 85s are set to increase by 39 per cent and 106 per cent respectively.

The number of 0 to 14-year-olds and 15 to 64-year-olds is projected to increase by only 11 per cent and seven per cent respectively.

The population of the UK is 63 million, of which 16 per cent is aged 65 or over. The proportion of those aged 65 and over in East and West Sussex is much higher – 22 per cent and 20 per cent respectively.

“The pace of change is only liken to quicken,” warns the report.

HEALTH CHIEF: REPORT IS A WAKE-UP CALL

DAVID Lily, chief executive of Healthwatch Brighton and Hove, said the viability of the care home sector in Brighton and Hove is of deep concern.

He said: “Increasing demand, rising prices and restricted choice seems to be the direction of travel.

“Increasingly the most frail and vulnerable members of society rely on care homes to help them maintain their health in the context of primary care and emergency care systems that are operating at the limits of their capacity to cope.

“This latest report should act as a wake up call to both the government and local authorities that many care homes are likely go under or cease operating unless funding issues are addressed.

“Last year Healthwatch Brighton and Hove published its own report into care homes.

“Its review focused on access to primary care services and monitoring basic health needs.

“We found variable quality of primary healthcare with three key issues of concern.

“They were poor systems for maintaining residents’ basic health needs; limited take-up of preventative health checks and poor adaptations for visually impaired.

“Undoubtedly some of those weaknesses will have come about as a result of the financial stresses under which care homes in the region are operating.”

Staffing and recruitment issues were identified by 27 per cent of care homes surveyed by Rix and Key as a key issue for their businesses.

Staffing issues fell into two groups – general problems in hiring and retaining the right staff and the impact of increased staffing costs.