More than half of Irish nursing homes did not report a profit in 2023, according to advisory firm BDO Ireland which conducted research on behalf of representative body Nursing Homes Ireland.
Its report found there was a total of 32,239 registered beds in the country, a rise of 1.6 per cent in two years. But financial pressures have threatened the sustainability of many homes, particularly smaller operations and those in rural areas.
Despite increases in the HSE’s Fair Deal rates, these payments “still fail to align with the actual cost of care” as a result of rising labour costs and other inflation, BDO said, adding that it was “noteworthy” 51 per cent of the 100 private and voluntary homes surveyed in mid-2024 reported making a loss in 2023.
Across the public, private and voluntary nursing home sectors, there have been 34 home closures over the past two years and 17 openings, resulting in a net reduction of 17 homes. This breaks down into a net decline of two homes in the public sector and 15 in the private and voluntary sectors.
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“Overall, the country saw improved occupancy rates. However, the sector is under immense strain due to rising costs, inadequate funding, and reduced construction activity,” said BDO Ireland managing partner Brian McEnery.
“Urgent measures are needed to safeguard the future of nursing home care in Ireland.”
The worst hit region for closures across all sectors was the west (Galway, Mayo and Roscommon), where eight nursing homes closed and just one opened. That amounts to a 6 per cent reduction in beds compared to a 12 per cent increase in the northeast. None of the regions reported a net increase in homes over the period.
New homes tend to be larger. In the private and voluntary sectors, the average number of beds in the 30 homes that closed was 36, while new homes have an average of 99 beds. This resulted in a capacity increase of 599, with the number of beds in these two sectors reaching 27,160.
The report also found a weekly disparity of about €640 per bed between the average public rate and private rate. Taking an average-sized, 60-bed home, this suggests a public home receives on average €2 million in additional revenues via the Nursing Home Support Scheme above that received by private and voluntary operators, it said.
The average Fair Deal rate as of November 2024 was €1,207 – a 14.2 per cent increase since May 2022. Fair Deal funding accounted for 69 per cent of nursing home income, with the remainder coming from private payers and other sources such as contract and complex care.
However, rates varied significantly across counties, with Dublin recording the highest at €1,335 and Donegal the lowest at €1,125. The disparity here across an average size nursing home of 60 beds sees Dublin nursing homes receive €655,000 per annum more than their Donegal equivalent. Westmeath saw the steepest rise in Fair Deal rates since the last report, up 18.1 per cent, while Dublin experienced the smallest increase at 8.1 per cent.
“To ensure the future of nursing home care, the government must publish the long-awaited Fair Deal pricing review within its first 100 days and implement reforms that align Fair Deal rates with the true cost of care,” said Nursing Homes Ireland chief executive Tadhg Daly.
“Without these changes, the viability of local nursing homes is at risk The Fair Deal pricing, in its current form, is simply not fit for purpose, and without urgent reform, we will continue to see nursing home closure that will have a profound impact on older people, families and healthcare services.”
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