In Japan, most home care providers are for-profit. In Denmark, around 44 per cent of older people choose a private provider for home help. In neither country, says Dr Darren Coppin, is profit in care much of a political fault line.
In Australia, by contrast, “for-profit aged care” can still start an argument at a barbecue.
Dr Coppin, founder and chief behavioural scientist at Ethyx, says the difference isn’t culture. It’s design. And it starts with a finding about snow shovels.
When Kahneman, Knetsch and Thaler asked people about a hardware store that raised shovel prices the morning after a blizzard, 82 per cent called it unfair. People don’t object to profit, he says. They object to profit that comes from someone else’s misfortune.
That is a problem in a sector where, as he puts it, “100 per cent of customers are standing in the snow”. The systems that have solved it all did the same thing.
“In every one of them, the family is not writing a large cheque at the moment of crisis. It is tax, insurance or money paid decades earlier. That single design choice breaks the link between one person’s misfortune and someone else’s income, and that link is exactly what triggers resentment.”
He is careful not to oversell any of them. “No country has solved everything. Every system is under workforce pressure right now.” But each offers a lesson.
Profitable, and proud of it
At provider level, Dr Coppin’s standout example is Hallmark Luxury Care Homes in the UK. It is overtly commercial, reporting an operating profit of about £10 million on turnover of £112 million in 2022-23. It also scores 9.8 out of 10 on carehome.co.uk across nearly 2,500 reviews, and is regularly named among the UK’s top care home groups.
“Hallmark does not apologise for its financial results. It explains them,” he says. Financial strength is what allows it to attract and keep good people, improve its homes, adopt better technology and build the next one.
“Profit through poorer care is bad. Profit through exceptional care is something very different.”
Four systems, four lessons
Japan: nobody pays at the worst moment. Everyone contributes to long-term care insurance from the age of 40, and prices are set by government. “A provider can only make money by running well,” Dr Coppin says. “Most home care providers there are for-profit, and it simply is not the political fault line.”
Singapore: the state builds, the operator runs. Government funds the buildings and tenders out the operation. That takes the capital problem off the provider entirely, and in Australia, he notes, that problem now means more than $600,000 for each new bed.
The Netherlands: fix the job, not the pay. Buurtzorg runs district nursing through small self-managing teams with no middle managers. Its overheads are around 8 per cent against a sector average of about 25 per cent, clients regain independence faster, and staff turnover and sick leave are well below average. Buurtzorg is itself a not-for-profit, but Dr Coppin says the lesson is about margin: “It earns its efficiency by trusting staff, not squeezing them.”
Denmark: shrink the demand. Councils must assess whether an older person can be reabled before providing ongoing help, and they offer preventive home visits to people over 82 before things go wrong. Reablement, helping people do things again rather than doing things for them, reduced demand for care and made the work more meaningful for staff, who became less likely to leave. “There is no profit debate to speak of.”
England is the warning
Not every overseas example is one to copy. In England, for-profits hold around 81 per cent of beds, and the Competition and Markets Authority found self-funders pay roughly 41 per cent more than council-funded residents in the same home.
In 2011, Southern Cross collapsed with 31,000 residents after its buildings were sold off and leased back.
“That is what happens when profit comes from the wrong places,” Dr Coppin says, “and it is no coincidence that England also has some of the loudest public anger about profit in care.”
What other industries worked out
Aged care is not the first sector to make money at an emotional moment. Dr Coppin says the closest parallel is the funeral business.
It is for-profit, it operates at the moment of maximum grief, and families make decisions on behalf of someone they love, under time pressure, with every opportunity for upselling. “That is aged care admission almost exactly.”
In the United States, much of the legitimising work was done by the Federal Trade Commission’s Funeral Rule of 1984. It required itemised price lists and gave families the right to buy only what they wanted rather than a bundle.
“Grief stayed outside the transaction,” he says. “Funeral directors charge for honouring a life, not for profiting from a death.”
Aged care needs its own version: itemised, published, unbundled pricing, with every extra opt-in. “Nobody has forced that on the sector yet, which is precisely why providers could do it first and take the high ground.”
Life insurance teaches reframing. In the early nineteenth century, insuring a life was seen as gambling on death. Within about fifty years, as sociologist Viviana Zelizer documented, it had become the moral duty of a responsible father. The industry recruited clergy as endorsers and priced the protection, never the life. “The money did not go away. What it was attached to changed.”
IVF teaches outcome transparency. It overcame deep discomfort about commercialising reproduction by framing itself around hope and by publishing success rates, which in Australia are public through YourIVFSuccess. “You pay for a treatment cycle, not for a child,” he says. “Aged care should sell quality of life, not dependency, and publish the outcomes that prove it.”
There is a cautionary tale here too. Veterinary care was commercial, emotional and uncontroversial for decades. After a wave of private equity buy-outs, trust began to erode, to the point that the UK competition regulator opened a full market investigation into vet pricing.
“None of them won by arguing that profit was fair,” Dr Coppin says. “But they did win by changing what the money was attached to.”
What Australian leaders can do next month
Dr Coppin’s good news is that two of these lessons need no legislation at all.
The first is reablement as the default, as Denmark has done: helping residents and clients do things for themselves again, rather than doing things for them. The second is small self-managing teams with real authority and agency over rosters and care, in the style of Buurtzorg.
“They could start next month,” he says.
The other two lessons are asks of government, and he knows which one he would lead with. Singapore’s model, where the state funds the buildings and the operator runs them, goes straight at the capital problem holding back new beds.
“‘Help us build the buildings’ is a far easier conversation than ‘let us make more money’.”
He also points out that Australia is not starting from scratch. The country already caps how much of the family home can be counted, puts a lifetime ceiling on what care can take from a person’s savings, and separates care from accommodation so each can be funded honestly.
“Australia has already built much of the machinery other countries are still arguing about,” he says. The task now is to make sure families feel it.
Dr Darren Coppin is founder and chief behavioural scientist at Ethyx, which focuses on predicting and preventing staff burnout and turnover to improve continuity of care.
