While there is general support for residents having a choice between bonds and daily accommodation charges under the user pay principles recommended by the Productivity Commission’s Report there is considerable anxiety and uncertainty as to how this might impact the financial dynamics of operators. In particular shifts from bonds to a daily accommodation charge for places currently categorised as extra service and low care that attract bonds.
While individual situations will vary our modelling shows that there is an inherent financial benefit from the resident’s perspective to pay a bond over an accommodation charge. Read the rest of this entry »
Guild Accountants in conjunction with ACAA-NSW are hosting an informative event into the impacts of the Productivity Commission Report into Caring for Older Australians. To find out more follow this link.
Introduction
Recent amendments to the Aged Care Act clarify and restrict the way in which operators utilise bonds paid by residents in low care & extra service residential accommodation. The following summary considers the impact of these changes in the areas of; permitted use, opportunities that arise for providers, challenges to existing operating practices and finally how you might respond to ensure you comply with these new requirements. We have included some brief case studies that demonstrate situations where operators will need to review their current operating models. Read the rest of this entry »
The Challenge of Capital Financing in Residential Aged Care
In the community residential housing finance tends to be matched to the period of occupancy of the dwelling irrespective of whether the home is owned (outright or with a mortgage) or rented. This is achieved initially by the use of long term debt (25 – 30 years) and in retirement through equity in the residential accommodation unit. Read the rest of this entry »
