Nearly two-thirds of rural aged care homes running at a loss

More aged care homes are running at a loss, according to data released by Labor amid the federal election campaign – and an industry leader warns it will get worse.

The number of residential aged-care homes running at a loss in country South Australia has soared to nearly two in three, the latest data released by federal Labor shows.

The figures, produced by chartered accountants StewartBrown, show the total number of country homes running at a loss jumped from 37 per cent to 65 per cent in the year to December 2021.

In the metropolitan area, homes running at a loss went from 41 per cent to 46 per cent.

“The financial state of aged care in SA has become so much worse under Mr Morrison’s terrible neglect,” Labor aged care services spokeswoman Clare O’Neil said.

“Indeed, ever since his self-congratulatory 2021 budget, where he claimed aged-care problems would be remedied, the financial health of aged-care homes in SA has significantly deteriorated.

“It has become moderately worse in Adelaide, where now around half of aged care homes are running an operating loss. But it has blown out into a full blown emergency in country South Australia where the proportion of homes running a loss now constitutes two thirds.”

Labor had pledged to fund increased nursing care in homes and pay rises for aged-care workers to “help ensure more homes aren’t forced to close down”, she said.

Opposition Leader Anthony Albanese, centre, is joined by Josh Burns, federal member for Macnamara and Clare O'Neil, member for Hotham, speaking about aged care. Picture: NCA NewsWire / Andrew Henshaw

A government spokesman rejected the criticism and said nationally 46 services had opened in 2020-21, nearly four times the 12 that had closed.

“The government’s $19.1bn commitment to aged care includes a range of early intervention measures to help providers improve their viability and in turn help to prevent closures from occurring,” he said.

“This includes the $100m Business Improvement Fund to support businesses to be sustainable, $397m in future capital grant opportunities through the Aged Care Capital Assistance Program and $144.7m for the Aged Care Registered Nurses’ Payment, which provides up to $6000 per year for those working in regional or remote Australia.”

Aged & Community Services Australia chief executive Paul Sadler called for action to sustain the sector.

“Too many aged-care providers are currently experiencing financial pressure and it’s only going to get worse,” he said.

“We need a more financially sustainable aged-care sector to help meet the needs of a growing population of older Australians.

“The risk grows outside of metropolitan areas in our regional and rural communities, where lack of access to staff and higher costs can add to financial stress and threaten the viability of services.

“The next federal government must act quickly to underpin the sustainability of aged-care providers.”

Originally published as Nearly two-thirds of rural aged care homes running at a loss