Has adequate provision been made for the future residential care of older people? Not according to a report commissioned by the Department of Health from economic consultants DKM which estimates that 24,000 new nursing home places will be required over the next two decades. That would involve almost a doubling of the current number of residential home places by 2036, equivalent to an extra 250 new nursing homes.
At present, the private sector provides 76 per cent of residential care beds and the public sector the remainder. But the report has found the main barrier to new investment in private nursing homes is the pricing model operated by the Fair Deal scheme. For private operators, this model is seen as too inflexible and too uncertain; as it fails either to reflect investment and operating costs adequately in different parts of the country, or to recognise the varying degrees of dependency that residents in care may need.
The consultants also found that while the State may be overpaying for nursing home services in Dublin, in other parts of the country the payment rates “are insufficient to provide an adequate return on capital”. This has made new private sector investment in areas outside Dublin less likely.
At the same time public nursing homes, which are generally situated in older buildings, have come under closer regulatory scrutiny as a number have failed to pass Health Information and Quality Authority (Hiqa) inspections. While State policy is to retain a 20 per cent presence in this sector, doing so will involve a “significant cost” to the exchequer over the coming decades. The Fair Deal scheme is seen as an imperfect pricing mechanism and the report strongly favours its restructuring.
To secure the proper provision of nursing home care for an ageing population – as indeed with the urgent need for the introduction of a mandatory occupational pension scheme, given the unsustainability of the State pension – decisive action is required. In a State with an ageing population, the demographic clock is ticking.