Nursing home providers warn of potential ‘tidal wave’ of operators leaving Fair Deal

A funding shortfall could lead to a “tidal wave” of nursing home operators withdrawing from the scheme under which the State funds beds in private and voluntary-run care facilities, providers have warned.

Privately run nursing homes have criticised what they say is a large disparity in funding per bed between their facilities and those run by the Health Service Executive under the Fair Deal scheme, which they say is being exacerbated by high levels of inflation.

The upshot of this was seen this week when residents at the Beaumont Residential Care nursing home in Cork were told that due to “extreme financial pressure” the provider, CareChoice Group, would be pulling out of the Fair Deal scheme and that the facility would remain open only for residents paying fees privately.

Pat Kennedy, chief executive of Windmill Healthcare Group, which runs six nursing homes, said the funding shortfall under the scheme meant many providers were struggling to survive. “The structure is broken,” he told The Irish Times. “Nursing homes are in serious trouble.”

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Mr Kennedy said operators were “locked into” rates received per resident, which did not account for current increases in costs and high inflation. He warned that this could lead to a “tidal wave” of nursing homes opting out of the Fair Deal and only accommodating residents who could pay full private fees.

He said State funding paid through the National Treatment Purchase Fund, an agency set up to reduce healthcare waiting lists, was not covering the amount it costs to provide care to residents.

[ Can it make more sense to pay privately for nursing home fees? ]

CareChoice chief executive Stuart Murphy urged the HSE to “come to the table” to discuss funding for its Cork nursing home. While the group’s nursing homes would not be closed, he said “there is a risk across all our homes of what we do next”.

Tom Finn, chief executive of Silver Stream Healthcare Group, which has 11 nursing homes, said Fair Deal funding to providers has historically lagged behind the rate of inflation. As a result, he said, private and voluntary providers were at a “massive disadvantage” as the scheme prohibits them from passing on additional “inflationary costs” to residents.

Michael Dennehy, who owns the 61-bed Oakview nursing home in Belturbet, Co Cavan, said privately run homes were facing huge costs as they were “trying to compete with the HSE” for staff. The costs of running the home had “seriously” increased in recent years, he said, adding that “the Fair Deal just isn’t a fair deal”.

Tadhg Daly, chief executive of Nursing Homes Ireland, which represents private and voluntary providers, said: “HSE nursing homes are receiving an average fee under Fair Deal that is close to €800 per resident per week more by comparison with private and voluntary counterparts.”

This disparity, he added, amounted to “gross discrimination” against private and voluntary-run nursing homes.

Mr Daly said 23 private or voluntary nursing homes had closed in the past 18 months, in many cases due to financial pressures. He called for “an immediate fit for purpose stabilisation fund” to stem the tide of nursing home closures.

The Alliance, a group established recently to represent smaller nursing homes, said the current Fair Deal funding model was “not fit for purpose”.

A spokeswoman for the HSE said public nursing homes received more in funding as they generally had a “higher cost of care”. She said this was in part due to HSE-run facilities having higher ratios of nursing staff compared with private nursing homes and due to rates of pay and leave entitlements being higher in the public sector.