The subject of care is always a hot topic in the media and this week has been no exception, with the recent news of spiralling costs for residential care. Over the last two decades, the average price of residence in care homes has doubled to around an astonishing £1,000 a week, but what has caused such steep inflation in price?
Reports indicate that the price rise is due to several issues including short supply of staff, tightening budgets creating a range of financial difficulties experienced by UK care home operators. Despite rising prices, the demand for assisted care homes continues to grow, particularly as the average living age rises.
Acutely hit are individuals who do not require regular, if any, assistance but are still burdened with the high care fees. The financial gap between the price of state-funded residents private payors is continually expanding. Private payers truly paying the price for the problems faced by the care providers. Yet, with artificially low budgets impacting the state-funded places are impacted too.
Shocking figures released by the NHS Digital last month emphasise this problem faced by the country, with the organisation indicating that they received 1.8 million requests for help in 2016, with no indications of this figure dropping.
Research from the Telegraph Money highlights the average inflation rate for residential homing has seen an average 2.7% increase per year, whilst care fees have seen a 4.4% increase over the same period (incorporating the figures from both private and public care).
While the media tends to focus on the problems faced by the individuals themselves, it is important to remember that there are also huge problems faced by the care providers themselves. These institutions are trying to administer acceptable standards of care and have to incorporate the introduction of the national living wage, in addition to tightening budgets within their planning. Those who pay for residential care must realise these issues, faced by care providers, could result in higher prices – irrespective of other inflation rises.
And whilst there are several guides directed at helping the thousands of elderly individuals in need of advice regarding this topic, these solutions are often time-consuming and place the responsibility on the individual rather than addressing the heart of the matter – COST. The information available to care homes to manage medical business costs is sparse at best, and problems can be expected to continue unless cost-effective solutions can be introduced. Whilst recognising that the money issues facing care homes will not be eliminated entirely by business financial services, employing specialist expertise consultants to uncover best value solutions can be the first step to improving costs.
If you work in the management of a care home, or simply a business in need of expert financial advice, get in touch with us today. Our experienced teams work in a number of areas to dramatically reduce the operational costs of organisations within a wide range of industries.
Article by: Glenn Kenworthy