Al-`Aqar Healthcare REIT Annual Report 2020

AL-`AQAR HEALTHCARE REIT Annual Report 2020 50 Market Report Summary 4. Australia Aged Care The aged care industry faces special challenges as Australia looks to theuncertaintyof futurewavesofCOVID-19and theneed for sustained vigilance. The aged care industry must continue to navigate an uncertain journey through the pandemic, coupled with responding to the final recommendations stemming from the Royal Commission into Aged Care Quality & Safety (now pushed back to February 2021). Resident and family. For aged care residents and their families, the health impacts of the disease itself have been complicated by the consequences of social distancing, alongside greater difficulties in accessing other health and wellbeing needs. Aged care operator. During COVID-19, thousands of beds in residential aged care have been left empty across Australia as families have decided it’s safer to keep their loved ones at home. As residential aged care occupancy rates fall to 10- year lows, home care providers may struggle to care for more patients with high acuity needs. Lower occupancy will add to the financial pressure on aged care providers because it means they are receiving less revenue. While the big operators would be able to survive the downturn in people wanting to live in aged care, smaller providers could be affected due to a lack of new deposits coming in as occupancy drops and existing deposits are refunded. OPERATIONAL PRESSURES AND STRATEGIC UNCERTAINTY FOR THE AGED CARE INDUSTRY SHIFTING OF INSTITUTIONAL CARE TO COMMUNITY HOME CARE Looking to the future. Protecting residents of aged care facilities and older people living in the community from COVID-19 is understandably the current focus of governments. However, over the longer term there is a need to address the flaws in the existing system, identified by the Royal Commission. Two key recommendations from the Interim report are: (i) to increase the numbers of care packages to enable older people to live at home for longer; and (ii) to cease the use of medications to restrain people indicate the depth of the problems in aged care in Australia. 4 trends set to shake up the sector in coming decades: (i) Demand for aged care beds & staff will only grow. With almost one third of Australia’s baby boomers already past the official retirement age of 65 (when they can access the full aged pension) and approximately 8% of all Australians aged 65 and over living in residential aged care, demand for new aged care beds will rise by an estimated 76,000 places in the next 5 years alone. Looking at the longer term, the federal government’s 2015 Intergenerational Report predicts the number of Aussies 65 years and over will double from 3.6 million today to 8.9 million by 2054- 55. This not only makes the aged care sector an attractive prospect for job seekers looking for a stable, in-demand career, it also means paying for aged care will become a hot political issue. Thousands of beds in residential aged care have been left empty across Australia as families have decided it’s safer to keep their loved ones at home 8% of all Australians aged 65 and over living in residential aged care Intergenerational Report predicts thenumber of Aussies65 yearsandoverwill double from3.6million today to8.9millionby 2054-55