Care Home Confidence ?

At a time when lots of Care Home companies are on the verge of collapse and many homes have already closed, one company is moving in the opposite direction.      HC- One is company that grew out of the ashes of Southern Cross.  (You can see my posts on the Southern Cross storey by clicking on it in the Tag Cloud)

HC-One was set up  by Chi Patel, a doctor who moved into merchant banking.     Not an obvious career path, but one which led him to later switch to developing and managing nursing and residential care homes.     Now his  most recent incarnation has bid to takeover BUPA’s clutch of former Southern Cross homes, at a reported cost of up to £450 million for 150 homes.     This will make HC-One the largest residential care provider in the U.K. with 22,000 beds.

This, in a market full of gloom.    Squeezed Local Authority funding for Social Services, a jump in staff wages on the way and a vendor in BUPA  that has reached the opposite conclusion about its Care Homes.    Generally thought to be ” low quality”, they have been trying to sell them for more than a year.

So is Chi Patel a fool or just foolhardy ?

Well he has made himself a fortune out of running Care Homes, so I don’t think he is a fool.      But he is taking a big risk, probably with other people’s money.

The things in his favour are :-

  • the demographics of the older population and their increasing frailty won’t go away;
  • NHS hospitals are being swamped with older people who can’t be discharged;
  • later stage dementia cannot easily be coped with at home, but neither is hospitalisation a solution;
  • capital funding should be able to be secured against the homes, at relatively low rates compared to the past;
  • many residents will have homes that can be eventually used to fund their care, which would suit future Governments.

He is betting on older people’s lives, but I wouldn’t bet against him.    In the aftermath of the Southern Cross demise there were many lessons learned :-

  • the Regulaters can precipitate a collapse, but they can’t prevent it;
  • lenders have no easy exit routes, once they are in, they are in for the long haul;
  • the residents may be in for a bumpy ride if things start to fail, but they are also locked in, probably literally.

Even though I don’t favour Care Homes as answer, at least he is trying to do something.

 

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2 Responses to Care Home Confidence ?

  1. There are two sides to this equation if I may be allowed to interpret ate.
    There is the human side, and emotive side of the residents: For instance we or the blog has covered much ground on ‘DEMENTIA’ and its effects on the elderly. As I grow older I am reminded by my past elderly relatives that while a family involve many members of all ages, it is good to now and again retire gracefully, and chatter, natter, exchange views and opinions, with people of my own age group, have a laugh and a joke, and maybe without realizing it, the odd comment from my loved one, and the younger ones ”Your loosing it Dad”? It is that interaction with some one who has spanned the same approximate number of years as my self; Maybe I speak the dementia language? Double dutch to an outsider, but I can still laugh and joke, about life, with my fellow man.
    As to the hard reality of a care home industry and bricks and mortar, well we all must thank the investors for their time: However from the past blogs I note them to be venture capitalist mainly from america, and the new man on the block, is of an Asiatic name: However whether this is new money from India, I am unsure!
    The concept is simple and honest, but the link to politics and the Labour party make me wary of his motives, and those of Mt Coybin? This strikes me of lots of jam tomorrow, and easily spoken words with the tax payer picking up the tab.
    We do need a long term solution, and a level playing field, both for investors and the prospective residents, and possibly a culture of encouragement to some form of added initiative besides paying rent and a lease that at ones death the residents estate, receives a return of sorts-tied in to the current stock market/bank rate ???-Maybe an exgratia payment?? Thinking caps on please?

  2. davidwfreeman237 says:

    Here while I enjoy the company of my own age group, I make a more generalistion that is various retirement/working persons people not younger but a thorough mix of over 55 years of age. This is especially meaningful in a modern retirement village, and Ii would suggest with respect in a residential home with a weather eye on mobility , fitness and general health.

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