Far North aged care sector continues to struggle with demand

Kerikeri Retirement Village currently has a wait list of 120 beds for its 66 bed facility. Photo/Supplied

A national report released last week has depicted a perfect storm likely to hit those in Northland requiring access to aged residential care services.

The New Zealand Institute of Economic Research (NZIER) report, "Assessing the equity issues facing aged residential care over the coming decade", highlighted how government underfunding of the aged care sector was making it more difficult for older New Zealanders without financial means to access aged care services.

Aged Care Matters (A New Zealand Aged Care Association members movement highlighting the aged care sector crisis) commissioned the report in response to a lack of provision in Budget 2023 for aged care funding.

The report showed how older New Zealanders in Northland, as well as West Coast, Mid-Central, Whanganui and Tairāwhiti, were more likely to struggle to access the level of care needed.

According to the University of Otago New Zealand index of socioeconomic deprivation, more than 60 per cent of the population aged 85+ in Northland were categorised as deprived.

As a result, Northlanders were predicted to suffer greater inequities as the ageing population grew in the coming decades, likely to be exacerbated further by New Zealand's declining home ownership rates.

Elderly were also expected to suffer more due to increased costs of aged residential care (related to staff recruitment and training) and as access to aged residential care became determined by an individual's ability to pay.

According to Kerikeri Retirement Village board chair, Arjit Balasingham, there were currently not enough care beds in the Mid and Far North to meet demand.

He said Kerikeri Retirement Village was also struggling to keep up, with a waiting list of 120 people for its 66-bed care facility.

Balasingham put this down to a lack of funding in the sector, as well as the $22,500-$30,000 pay disparity between DHB nurses and those in the aged care sector.

He said those two factors were creating "dire" staffing shortages, plus the inability to break even and open more beds.

"Within our primary catchment of a 20 kilometre radius around Kerikeri, it's predicted by 2048 there will be demand for 574 beds," Balasingham said.

"In terms of the number of people over 70 in our primary catchment, it's currently around 4400, but by 2048 it's believed to be 8420.

"Who is going to look after all these people?"

Balasingham explained there were three new rest home providers in the primary catchment area who aimed to collectively open a total of 181 beds some time in the future.

He said despite these plans, no action had been taken to start building the facilities.

Balasingham believed this was due to the current aged care sector business model not being feasible.

"There is definitely a lack of confidence in this business because these things won't pay for themselves," he said.

"The government currently pays aged care operators a flat rate for every bed occupied in a care facility.

"But that rate does not cover the costs involved in keeping those beds open, and the shortfall is increasing every year."

New Zealand's model for the government funding of aged residential care has not been revised since 2000.

Balasingham explained that Kerikeri Retirement Village had plans to upgrade its facilities by 66 beds, set to cost approximately $15 million.

Due to a lack of funding, however, the charitable trust would have to campaign to raise the funds independently through fundraising and donations.

Balasingham said he felt the Government was working against the sector, and in turn putting more pressure on the health sector as a whole.

"If our 66 beds closed tomorrow, that's a 66-bed problem for our local hospital," he said.

"The whole aged care sector model was meant to move people away from hospital wards into nicer, brighter places for aged care.

"Part of the deal from the government at the time was to make this financially viable for the provider.

"It seems as if they've forgotten about that, and appears as if we might be going back to a scenario we hoped we'd walked away from."

The NZIER report found Northland also had a scarcity of dementia beds compared to the rest of New Zealand.

It noted the expected rise in the need for dementia care meant there would be a need for increased investment in the provision of dementia care facilities.

Representatives from Aged Care Matters plan to engage with government stakeholders to discuss the findings from the NZIER report in the coming weeks.