With our population aged 65 and over expected to grow by almost 700,000 people over the next five years, as Baby Boomers continue to reach retirement age, the Federal Government funding is anticipated to keep increasing in order to enable accessible, affordable and quality aged care for Australians. It is anticipated the industry will outperform the economy over this period and remain growing to meet the increased demand.
“Total expenditure on aged care services is forecast to grow by an annualised 6.4% over the five years through 2022-2023, to reach 25.7 billion.” (IBISWorld Business Environment Report on Total Government Expenditure on Aged Care Services, Sept 2017) This is supported by the 9,911 new aged care places that were announced in the 2016-2017 Aged Care Approvals Round (ACAR).
“Three quarters of these residential places are being provided to the development of new aged care services, the remainder will enable existing aged care providers to expand their current facilities,” Federal Minister for Aged Care, Ken Wyatt “There was a 15% increase in applications for this Financial Year, with around 4.5 applications made for every place available.” Economies of scale are being pursued as a result through aggressive industry greenfields and brownfields developments.
Other industry trends include the continuation of consolidation with private for profit players assuming a greater role in the sector. Providers are facing increasing margin pressure from rising service provision costs including wages. With over 60% of the industry operating only one facility and just under 30% operating between two to six facilities, and only 2% over twenty, there is considerable scope for mergers, acquisitions and amalgamations as providers seek greater scope and scale for increased profitability. Strategies to become financially sustainable are becoming increasingly important as the industry changes.
A 2017 Market study done by the CMA looked at Aged Care homes in the UK, particularly meeting the future needs of an ageing population. One of the points made was that to remain effective, the industry needed to carry out improved and informed planning to cater for changing needs and technology. (Australian Ageing Agenda April 4, 2018, ‘Why we should learn from International aged care’)
The adoption of new technologies for improved efficiency and cost effectiveness is becoming increasingly critical for sustainability. Procura’s next generation web-based Procura Clinical Care Software product is designed to enhance user experience, and provide quick clinical content development with improved communication between care staff. Procura Clinical Care will enable aged care residential providers to streamline processes and deliver better outcomes for residents, utilising the latest technology.
Procura Residential Management software is an expert and advanced aged care services solution offering comprehensive residential aged care management from initial enquiry and application right through to admission and beyond. It uses a Single Health Record approach; manages complex financial information including billing, bonds, subsidy management, e-business integration with Medicare and enables analysis and essential reporting that leads to increased efficiency.
Procura’s software for Aged, Community, and Disability Care Services leads the way in new developments in client management software for the industry.
Speak to a Procura staff member today about how our solutions can be applied to improve efficiency and accelerate growth within your organisation. Call T: 1300 252 922
- IBIS World Industry Report Q8601 Aged Care Residential Services in Australia
- IBISWorld Business Environment Report on Total Government Expenditure on Aged Care Services, Sept 2017
- Australian Ageing Agenda April 4, 2018, ‘Why we should learn from International aged care’