Care of the elderlyA survey of private nursing homes has found a €500-a-week difference between the cheapest and the most expensive nursing homes taking part in the study.
The survey for the Irish Nursing Homes Organisation (INHO) found that the weekly rate ranged from a low of €425 to a high of €925, noting that the highest weekly rate was in the Northern Area Health Board region in Dublin, where the average charge was €704.
The lowest average weekly rate was €464, in the Midland Health Board area. The overall average weekly rate was €578 - an increase of €21 on 2003 rates.
The survey was conducted by consultants Horwath Bastow Charleton. According to the reports' authors, there are a number of logical reasons for the big variations in price, among them higher land costs in large cities, significant difference in the hourly wage rates and urban versus rural overhead costs.
In general, the bigger the nursing home, the more expensive it was. Homes with less than 25 beds had an average weekly rate of €573 while the rate rose to €649 for homes with more than 60 beds.
Staff costs also varied enormously. The average staff cost was 55.5 per cent of turnover - a high figure, according to Con Quigley, managing partner of Horwath Bastow Charleton. However he said this cost is explained by the high level of care delivered by staff.
Staff costs accounted for 72 per cent of turnover in nursing homes in the North West but just 49 per cent of turnover in homes in the South East.
The survey also found that nursing homes in the North West spent the least on food - just €20 per resident - while homes in the South East spent the most, recording €47.33 per resident.
The INHO has encouraged private nursing homes to get involved in a group purchasing scheme which could make major savings on food, electricity and telephone bills.
The private nursing home sector has seen a major increase in competition in recent years. A shortage of nursing home beds in 1997 led the Government to introduce capital allowances for new nursing homes, offering generous six-year tax breaks. Since then, the numbers of new nursing homes have continued to grow, with a 10 per cent increase last year.
There are now more than 26,000 public and private nursing home beds in the State. Given that only five per cent of over 65-year-olds will ever need long term residential care, this means there is an oversupply of beds in every health board area, according to the INHO.
"There are approximately 2,000 vacant beds around the country," said Paul Costello, INHO chief executive. "We have enough supply of beds to do until 2011, even with the substantial increase in the number of elderly people."
The INHO is now calling for an end to capital allowances. Nevertheless, there are plans for 47 new private nursing homes across the State. Up to August of this year, 17 planning applications for new nursing homes, or extensions to current ones, had been lodged in the greater Dublin area.
In the Midlands, which has the lowest bed occupancy, four planning applications for new homes have been lodged.
Government plans to develop 850 more public beds under a Public Private Partnership would dramatically increase the supply and the INHO has called on the Government to scrap this plan. At an INHO conference last week, Quigley said there was "absolutely no need" for a PPP in this area. He said the whole notion of PPPs was "dying on its feet" and needed a radical overhaul.
Quigley warned nursing home proprietors that the planned increase in bed numbers would have a "huge impact" on their businesses should they come about and he advised them to think twice about further investment in the sector.
