Australia’s aged care infrastructure shortfall is bigger than you think – and the clock is ticking

Remember when Minister Mark Butler told the National Press Club back in April that, “we need to open a new Aged Care home every three days for the next twenty years. And, right now, we’re not. Not by a long shot!” Well, that’s not the full story.

We spoke to industry advocate Wayne Belcher OAM who argues that figure only counts new places, not replacements for ageing stock. “It’s effectively a nursing home every two days for the next 20 years. Which you would intuitively think that’s not possible.”

The implications for aged care leaders and their facilities might not be as dire as you might think, but there’s work to do now to make sure that isn’t the case.

The replacement problem

As Australia’s ageing population is growing fast – there will be more than 7.3 million 65+ by 2045 – the need for beds needs to match. The shortfall, briefly mentioned above, is twofold: existing facilities need a refit every 10-15 years, while at the same time new facilities must be built.

Over in Western Australia, Belcher has crunched the numbers. This looks like a new facility upgraded and a new retirement village every month, for 20 years. Nationally, this prediction will likely fluctuate, but the underlying message is still the same: action must be taken now to avoid chaos later. 

Retirement living is a missed pressure value

To ease the stress on an already strained system, Belcher believes retirement villages can provide some relief, but only if there’s adequate supply.

“If the supply is not there, people aren’t moving out of bigger homes,” he expands. “Bigger homes could house a family – that would help to reduce the housing waiting list. People taken to hospital to an emergency centre that’s blocked can’t get into a hospital bed because it’s full of people over 65 with chronic illness. Those people don’t have an exit ramp to go home, to get a community care package, to live well at home.” 

However, decades of underinvestment have closed off that option. 

What Belcher highlights is that what’s happening in aged care isn’t just an aged care industry problem. All of our systems are so interconnected that a shortfall in one has real and lasting impacts everywhere else. 

Why leaders aren’t seeing it

There’s a slew of urgent and important issues occupying the minds and calendars of leaders around the country. Stuck in ‘survival mode’, the much needed strategic infrastructure thinking is being crowded out. 

“We are so caught by the immediate – the complexity of the change of the Aged Care Act, the compliance. 61% of [providers] are operating in deficit, [so much so] that we’re actually losing sight of the fact that we need to leave a legacy.” 

The good news is that we’ve been here before – but it took a bold and forward-thinking government.

Who will answer the call?

“We’ve actually solved a problem like this before,” Belcher offers. “When our population was about a quarter of what it is now, we were still on a war footing just out of World War II. The nation was nowhere near as wealthy as it is now. People couldn’t get a place in the hospital, or more importantly, couldn’t get a place once they needed to leave the hospital.”

If that sounds familiar, it is. Our current challenge – to build and refurbish aged care facilities to support a rapidly ageing population – isn’t new. But the current response to it is lacking.

“It took a brave government [to tackle this problem]. What we now look at as retirement villages came out of that. The funding for nursing homes started through the National Health Act. We’ve dealt with these [issues] before with courageous thinking.”

The scale of the problem shouldn’t be an excuse for inaction. The question is this: as a leader, do you have the same appetite or are you hungry for solutions?

Each day of inaction compounds the deficit

Belcher is clear in his urgency: this is a governance problem for providers, not just a policy problem. 

“It needs to be a multi-pronged approach,” he explains. “We need to have courage about capital development, but we also need to develop a better way of funding our services. Generations that follow us are probably not going to be willing to give up their life’s worth to keep older people comfortable in an aged care facility.”