Patel issues new warning on care homes

HC-One chairman Chai Patel has warned that care homes are teetering on the edge and a chronic shortage of funding risks catastrophic failure within the National Health Service.

In an interview in The Times, he predicted that six national chains would emerge to dominate the market by benefiting from economies of scale.

Dr Patel is currently close to sealing a deal to buy about 150 care homes from Bupa, which would make HC-One the biggest company in the sector with 350 homes and around 22,000 beds.

The Times reports on the pressure on care homes amid government funding cuts and an increase in costs since all adults over 25 became eligible for the national living wage. Some small operators are quitting, with 144 care homes closing last year and a loss of about 2,000 beds a year.

A shortage of capacity means that the number of people in residential homes has not increased in line with rising longevity, forcing many frail and elderly people to rely on specialist care in their own homes.

Dr Patel admitted: “There is no question the sector itself is on the edge. The impact of chronic under-funding of social care will result in catastrophic failure in the NHS.”

He said his investors were betting on the requirement to care for an ageing population with more complex needs.

“Demographics are showing in the next ten years there is need for almost 70,000 beds and this is not happening.

“When local authorities are trying to work alongside social care providers you can see the challenge of trying to integrate these services. I think larger operators can bridge this gap.”

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