Four Seasons Health Care is closing seven care homes in Northern Ireland because they cannot be run profitably.
On Monday the company reported a pre-tax loss of £25.4 million for the third quarter of this year, although it did say that occupancy and weekly fee rates had ticked upwards across the UK.
A study this year by Knight Frank Research found that average weekly fees for care homes with nursing in Northern Ireland are under £600 per week compared to £900 in the south east of England. Average earnings per bed in Northern Ireland are also the second worst in the UK.
A spokesman for Four Seasons said the decision to close care homes in Northern Ireland was difficult but unavoidable.
“The principal reason behind this decision is that each of these homes is operating at a loss and they are no longer viable,” he said.
“The fee income that the homes receive is below the cost of the care they are providing and we have effectively been paying a subsidy for them to continue to provide care. We regret that we cannot continue to sustain this position.
“Additionally, the national shortage of nurses means it has been difficult to recruit and retain permanent staff of the right calibre. This leaves the homes reliant on temporary agency nurses in order to maintain staffing levels, that carries a high cost and presents challenges in maintaining the quality of care we expect to provide.
“The well-being of the residents is our priority and the homes will continue to provide care while we allow plenty of time for them and their families to be supported to find suitable alternative placements. We will do everything we can to ensure there is no disruption to their care during this time.”
Four Seasons remains the biggest private care home operator in Northern Ireland with 62 homes.
In a conference call with investors following the release of its third quarter results, Ian Smith, the group’s chief executive, said the government must address the funding crisis in the care sector. “If the cost burden of the national living wage is not offset by increased local authority funding for elderly social care, then a significant proportion of care beds in Britain will become unviable. A recent report has said there are 37,000 beds at risk as operators close homes or increasingly focus on self-funding residents.”