Rising costs push nursing homes closer to the brink
Higher operating costs, staffing shortages, and increasingly more complex care needs of residents was among the threats facing Galway’s nursing homes, a new report has found.
Analysis of the sector by consultancy PwC, on behalf of Nursing Homes Ireland (NHI), highlighted 31 nursing homes across Ireland and 915 beds have closed in the last three years.
According to NHI, included in that figure are four nursing homes in County Galway that have closed since January 2021.
A spokesperson said they include Corrandulla Nursing Home, Castleturvin Nursing Home in Athenry, Oughterard Manor and Kiltormer Nursing Home (pictured). They closed between 2021 and 2023.
The independent report for NHI, ‘Challenges for Nursing Homes in the Provision of Older Persons Care’, demonstrated how providers are under pressure as they deal with increasingly complex resident profiles and incur rapidly rising operational costs driven by the impact of infection prevention control requirements, inflation, and staffing shortages.
The report found there has been a 36% increase in the operational cost of care per resident since 2017. But the sector claimed there have been only ‘marginal’ increases to revenue streams through the Weekly Fair Deal Rates for residents.
The result was 33% of nursing homes surveyed by PwC reported an operating loss in 2022, up from 19% in 2021.
NHI said it was “unsustainable” and it predicted more nursing home closures were inevitable without reforms to the pricing model and an increased Fair Deal budget.
Tadhg Daly, Chief Executive of Nursing Homes Ireland, said the findings of the report must serve as a wake-up call to Government. “It is becoming increasingly unfeasible to operate a nursing home in Ireland, due to rapidly rising costs and only very marginal increases in income stream – which is the result of a Fair Deal Rate pricing mechanism no longer suitable for the current operating environment,” Mr Daly said.
He said over 20 nursing homes have closed their doors since the beginning of last year.
“The sector is in a state of crisis and contraction, with more and more homes and beds closing and not being replaced. This has been particularly prevalent among smaller operators in rural areas to date, but will encapsulate medium-sized and larger operators if the status quo prevails. Urgent intervention is required,” Mr Daly added.
The sector needs ‘immediate action’ on Fair Deal rates, he said, to prevent more nursing homes from closing down.