Australia’s residential care providers are in a challenging environment. While some providers are making healthy profits, smaller providers are struggling to survive.

This survival-of-the-fittest approach was exposed by ABC’s recent 4 Corners program, which put a spotlight on failures of parts of Australia’s residential aged care system and served as a catalyst for the announcement of a Royal Commission into Aged Care Quality and Safety.

The data has been clear for a long time. Residential care providers are struggling, complaints have risen, and staffing skill ratios have declined.

It’s a tough business. In March this year, 43.1 per cent of residential care facilities had a negative earnings result (Stewart Brown 2018). Unsurprising given that three in four (75 per cent) complaints are directed to the residential care sector.

Operating within just residential care is becoming increasingly unviable, especially if you’re a small provider. Providers providing only residential care fell by 16 per cent in the year to June 2017, compared to home care, which saw providers increase by 125.3 per cent.

These trends will continue, as smaller and less efficient providers are absorbed by larger players. But thought needs to be put into how this adjustment process impacts the lives of our elderly.