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Southern Cross admissions fell before closure

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The depth of the financial crisis at collapsed care home operator Southern Cross has been further illustrated by new figures showing admissions sliding just before its decision to close down.

Southern Cross’ crisis was brought on by a rising rent bill and lower fees as occupancy rates declined and local authorities reduced the number of patients they placed with the group.

That trend accelerated in the three months to June with overall admissions down by 7.5% year-on-year with a 10.5% fall in local authority referrals and an 8.1% drop in patients from the NHS.

Occupancy over the nine months in total fell from 89.5% to 86.5% while operating losses rose to £39.1 million, up from £26.9 million, as revenues fell 2.1% to £696 million.

The UK’s largest care home operator with 31,000 residents, Southern Cross announced in July it would close down after a rescue that plan involved reduced rents across its 752 homes was rejected by its landlords.

Owners of two-thirds of the homes have indicated they would take them back and run them themselves, which includes 249 homes to be taken back by NHP in conjunction with Chai Patel, the former boss of the Priory chains of clinics.

Uncertainty, though, still surrounds the fate of a third of the homes and also the timetable for a handover.

The GMB union said that the landlords had missed a deadline of August 1 to appoint new operators, which it claimed may put the timetable for a complete handover by the end of October in doubt.

Southern Cross said it expects to produce a list of the new operators within the next two weeks and to hit the October deadline.

 

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