04 Sep 2023 at 10:29
More and more institutions for elderly care are in financial difficulties. If nothing changes, bankruptcies are inevitable, according to accountancy firm BDO.
In brief
Elderly care is experiencing more and more money problems and bankruptcies are inevitable. Less income, higher expenses and cutbacks lead to problems. The quality of care provision is under considerable pressure.
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The office has reviewed the annual reports of 789 organizations in elderly care and sees that the money problems there are getting worse. The institutions saw their profits halved last year compared to the previous year: from 533 to 263 million euros.
More and more institutions are losing money. Of the organizations surveyed, 238 ended up in the red last year. That is 40 percent more than the year before.
This is due to the combination of less income and higher expenses. For example, many organizations spend more on personnel, partly because they have to hire relatively expensive freelancers. Higher energy costs, high absenteeism and a shortage of employees also lead to problems.
Cabinet imposes cutbacks
At the same time, revenues are declining. For example, starting next year, the institutions will receive less money to house the needy. The cabinet also plans a cut of 1.2 percent. And that percentage will continue to rise in subsequent years. There is also pressure from health insurers to keep rates low.
“A financially unsustainable situation is imminent. Loss of quality and bankruptcies are imminent,” says Mike Tagage of BDO Accountants & Adviseurs. He fears that there will be less time for personal attention, daytime activities or proper care of the elderly. “It is downright alarming and does not bode well for the coming years. Government intervention is necessary.”
Moreover, because of the problems, the institutions increasingly have to call on informal carers. In addition, there is no money for the necessary investments in areas such as sustainability and automation.
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2023-09-04 08:29:29
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