The poker game that was the story of Southern Cross ended up as “pass the parcel”. A large group of former Southern Cross residents have been handed back to their landlord – NHP, and in turn they have entered a partnership called HC-ONE. NHP is a near-bankrupt company, which can only be still in existence because it is too difficult to close.
Their new partner is Dr Chi Patel. He is someone whose path crossed mine for many years, while I was at the ExtraCare Charitable Trust. I have never met him but I did see him as an influential figure in the nursing home industry. Although he has a medical background, it was his merchant banking connections that were more significant in the growth of Court Cavendish and then Westminster Health Care. Both became significant privately funded nursing operators mainly providing for self-funded residents.
Now he is going to require all his skills to reshape the over-leveraged NHP portfolio. He will need to persuade the financial backers to moderate their vulture capitalist ambitions and at the same time he will have to convince impoverished Local Authorities to pay at least as much to the private sector as they pay to their own staff and to run their own homes. Neither of these tasks will be easy to achieve, but they are the only way forward for publicly funded residents who need nursing or residential care. Alternatively Dr Patel will have to abandon state funded residents and gradually shift his marketing efforts exclusively toward privately funded residents, which is the most likely option that he will take. Which means in the longer term another major provider will be forced to abandon all but the highest paying state-funded residents.
His aspiration is to “provide care for his residents, that he would wish for his own mother”, which is a good place for a fresh start. He has made this promise to relatives – it is to be hoped he can live up to this lofty ambition.
For earlier posts, click on “Southern Cross” in the TAG CLOUD