Dozens of nursing homes at risk of closure as Fair Deal scheme fails to match soaring inflation

The closures would have major implications for hundreds of families, while there could also be long-term consequences for Ireland’s ageing population.

Tom Finn, founder and chief executive of Silver Stream Healthcare, has written to the National Treatment Purchase Fund (NTPF) this week, asking for contracts for some nursing homes to be renegotiated in the face of soaring inflation rates.

“This year, unless something changes, I have no doubt there’ll be another 20 or 30 nursing homes closed,” Mr Finn said.

He added that the number of new nursing homes being built in the country at the moment “could probably be counted on two hands”.

Mr Finn said the sector was under huge strain due to a lack of funding, at a time when inflation was rampant.

“There’s a crisis already when it comes to staffing and funding and there’ll be a huge capacity crisis very, very quickly,” he said.

Silver Stream Healthcare is owned by Dutch company Waterland, which bought the business in 2019.

It operates 12 nursing homes around the country. ​

​The Government’s Fair Deal Scheme is a financial support scheme using public money for people who enter into long-term nursing home care.

Each individual nursing home – even if it is part of a group – has to negotiate its own Fair Deal contract with the NTPF.

Those contracts might be for nine, 12 or even 24 months and allow for just 2pc cost inflation, said Mr Finn.

While the annual rate of inflation has slowed, it is still running high.

Inflation was at 7.7pc in January, and 8.2pc in December.

Nursing homes, meanwhile, are faced with higher staffing costs as well as constant demands for mandatory – and often expensive – upgrades from health and other regulatory authorities.

Mr Finn said the NTPF contracts should be “re-addressed” in face of the mounting costs.

“Otherwise, if the rates are locked in until next year, you can’t survive on a 2pc increase when you’ve got 11pc inflation,” he said.

“Medical inflation is always higher than general inflation.

“You can’t continue to provide the level of care if you’re effectively being paid 10pc less than you were a year ago,” he added.

Mr Finn pointed out that some public nursing homes received substantially more under the Fair Deal scheme than many private homes, even though the public homes might be much older and would have substantially fewer amenities and fewer individual rooms for patients.

He also noted that elderly people now typically get to spend more of their later years at their own home before they enter a nursing home.

However, by the time they become patients, they usually have more challenging and expensive healthcare requirements.

The nursing home boss also said Silver Stream Healthcare was having to source a large number of its staff abroad, paying between €7,000 and €8,000 for visas, registration and other paperwork.

In regional areas, housing is a bigger issue for staff than in Dublin, he added.