Two years before care homes recover, LaingBuisson forecasts

By freelance social care writer Eleanore Robinson
Occupancy rates during the first COVID-19-induced lockdown plummeted eight percent, equating to 31,800 residents in the UK’s care homes.

During the first lockdown 1 care home COVID deaths accounted for around one in every two of those seen in the general population, denting confidence in the sector and, of course, with the loss of much-loved residents. In total, between March and September 2020, the care home population dropped from 395,100 to 363,300 in September, according to the latest LaingBuisson report, Care homes for older people.

However, according to the report, care homes deaths now represent up to 30 per cent of those in the wider population, indicating current measures are working.

Report author William Laing said: “We are projecting a recovery, but our best estimate for this recovery is 2023.”

After this date, LaingBuisson predicts a rise in demand for care home places of between 412,100 and 488,100 in line with the 2.5 per cent annual growth seen in the population ‘of care home age’.

New admissions

In the meantime, many homes will be left facing struggling to fill empty beds, putting additional pressure on already tight margins. A key barrier to occupancy is the requirement in some areas for whole homes to be COVID-free for 28 days.

In addition, limitations on referrals from hospital, as well as a move by local authorities and self-funders to manage more people at home have all had an influence.  

In hardest hit areas, the reduction in admissions is well above the average – by between 40-50 per cent, he says. And this average belies a wide variation in geography or how individual homes have fared.

Those homes that have avoided the virus have been able to absorb new NHS and local authority admissions, and have been first in line to attract the more lucrative self-paying customers.

Rayner said: “In the context of finances because of cross subsidies it really matters where they are coming from and that balance needs to remain. It is all these things at once.” To make matters worse, the cost of care has increased, particularly with the need for PPE and testing.

The results of NCF’s Pulse survey, published this month, found 87 per cent of providers have seen an increase in operating costs due to COVID-19 while 75 per cent reported a decrease in income.

Rayner said: “It is going to be very difficult for organisations. How can you square that circle? How long is it possible to sustain this? I think we will be living with this for years to come.”

She said some providers had eliminated agency staff as resident numbers fell. Additional Government funding had also made a difference, although the funding gap has not been completely filled. 

Chancellor Rishi Sunak’s support for small businesses has also supported care homes. Laing describes the PAYE holiday as “a lot money”. Of course, give-aways of this type have to be paid back and when they do, it’s possible some homes will stop trading.

Some owners who have been thinking about shutting homes might now bring that decision forward, Rayner suggests.

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