Reform, the Royal Commission and consumer demands have placed mounting financial pressure on aged care providers. While all strive to deliver the best quality of care possible, the mission is made much more difficult when operating on a shoestring.
The sector has been described as “unsustainable” following the release of the Aged Care Financial Performance Survey which revealed 51% of the aged care homes surveyed operated at a loss in the quarter ending September 2019.
Graeme Wickenden, Chief Financial Officer of MiCare, believes one of the biggest challenges facing the sector over the next few years is funding keeping pace with the increasing costs of running a facility.
“We’ve seen significant tightening of funding through changes to ACFI and also across home care, yet there’s continued wage pressures and also higher expectations about how an aged care home is staffed,” Mr Wickenden said.
“This has been a prominent issue at the Royal Commission, and I’m sure Providers are anxiously awaiting the final recommendations from the Commission.”
In view of the increased pressure to achieve a financially sustainable model of care, Mr Wickenden recommends three key technologies:
- “Implementing a Business Intelligence solution that facilitates the access to management reporting that guides an organisation to identifying key business metrics and respond accordingly;
- “Use of robotics to undertake repetitive and time-consuming tasks; and
- “Integrated care and administrative systems that eliminates duplication and manual processing.”
For providers planning for sustainability during this ongoing period of uncertainty, Mr Wickenden had the following advice:
“Providers need to understand their vulnerabilities and address them. With 50% of Providers reporting operating losses and with pessimistic outlooks for the future, Providers need to face some realities about what they need to do to continue to support their communities.
“In some cases it would seem achieving a scale of operations that provides efficiencies and a sustainable operating base will require further consolidation across the sector. Others may identify niche markets that they are able to establish bespoke services for.”
Mr Wickenden has experience in both for-profit and NFP entities, having started his career with positions at NAB, Dun & Bradstreet and Aviva Financial Services before moving to VincentCare. He’s also served as CFO of Villa Maria, Catholic Homes and Alzheimer’s Australia Victoria.
Mr Wickenden is speaking at the Financial Transformation in Aged Care conference, being held in Sydney from 29 – 30 April. He will explore how to leverage technology to drive sustainability, including where to invest to have the biggest impact on productivity and efficiency.
The conference will explore the current state of funding for aged care, an evaluation of risk culture for organisational growth and unpack new opportunities for resourcing the sector.