SATURDAY: new aged care bed development drying up

Larger aged care operators with big balance sheets are being left to corner the construction of new beds – but creating the potential for a severe undersupply within years. In 2020-21, only $1.006 billion of new aged care construction was completed according to the 2021-22 Report on the Operation of the Aged Care Act – just 1.4% of homes were planning new building work. With the end of Aged Care Approvals Round (ACAR) coming in 2024, there has been no uptick in investment in beds – but the Government says it still expects new bed builds to increase.

PLACES TO PEOPLE REFORMS

A spokesperson for the Department of Health and Aged Care said, “Growth in the number of operational residential aged care places (or ‘new beds’) is anticipated to increase into the future with the Places to People reforms. “From 1 July 2024, places will be assigned to older Australians, which will provide them with more choice and control over which provider delivers their care. For providers, this change will give them greater freedom to adjust and expand service offerings to better meet demand. It will also help to create a strong residential aged care market with high quality, innovative and financially viable providers.”

The Department pointed to the establishment of the Aged Care Capital Assistance Program (ACCAP), which provides capital grant funding for providers to build, extend or upgrade aged care services, including residential care services.

“Up to $548 million has been made available until 30 June 2026. From 2026-27, at least $156 million per year will be made available on an ongoing basis. It is anticipated the next ACCAP round will commence later in 2023,” the Department said.

However, ACCAP is only aimed at supporting First Nations communities, regional, rural, and remote areas, people who are homeless, and those with complex and diverse needs, including dementia. What about the rest of the sector? Read more in the recent edition of our SATURDAY magazine.