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Sue Kedgley – Where exactly is the profit in Aged Care?

I’m really confused as to why the correct information about the supposed ‘profit’ in this sector is not getting through. (The New Zealand Herald – Sue Kedgley: Staff deserve cut of aged care profit.)

While I really appreciate the good work being done by Sue Kedgley and Co. on keeping the residents of residential care facilities, recipients of services and those who provide support to them at the fore, this argument for a bigger slice of the ‘profit pie’ to go to nurses and carers is based on an incorrect premise.

Residential care facilities, where these nurses and carers work, are not making huge profits. Most operators are making very modest profits that they then reinvest back into their service and many are making none at all. It is particularly tough for those who operate single facilities. Residential care is costly and much of the funding for it comes by way of Government subsidy. (In case you’ve got the wrong impression – I absolutely do agree; carers and nurses in the private sector should have pay parity with their DHB counterparts.)

Certainly, substantial profits seem to be made within the Retirement/Lifestyle village sector but that’s a whole different ball game and an entirely different way of funding. Village living is a self funded, largely independent living option for those who choose it. (Another significant difference between the two is that villages and care facilities operate under different legislation.)

If those village operators who also operate care facilitates (e.g. about 46% in Auckland) subsidised their care facilities wouldn’t it create a false impression of the real cost of residential care? What would be the implications for the care facilities that didn’t have a village to subsidise them? (There are many more of those than villages.)

I believe changes are needed in aged care; but before we start making decisions let’s make sure we’re talking about the same thing. We need to understand from the ‘get go’ where the money is and isn’t.

I’ve worked in this sector for many years and like many of my colleagues I’ve come to realise there is no more money in government coffers for ‘aged care’. Maybe the villages aren’t the right place to look for it either. Part of the solution might mean taking more responsibility ourselves; perhaps re-inventing community and community caring.

To my mind we’ve got a lot of thinking and talking to do yet before we come up with the answers that will work for us as a society.

About Eleanor Bodger

Eleanor Bodger