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B.C.’s seniors advocate finds multiple problems with long-term care home sector

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B.C.’s seniors advocate has found numerous problems with the way the province’s long-term care sector handles financial information.

Isobel Mackenzie says she found the financial reporting systems are inconsistent between health authorities and lack openness and transparency.

The report, released on Tuesday, also found there is insufficient detail for significant expenditures related to management fees, head office allocation and some administrative costs.

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“Contracted long-term care homes costs taxpayers almost $1.3 billion a year, and it is important to examine the levels of accountability, monitoring, and financial oversight in one of the largest contracted sectors within government,” Mackenzie said.

“The public needs to know whether contracted long-term care homes are meeting the needs of both residents and taxpayers.”

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The audit also found the method to report direct care hours was based on self-reported unaudited expense reports prepared by the care home operators with no ability to verify the reported worked hours.

Long-term care homes generate $1.4 billion in revenue of which $1.3 billion came from public funding. The largest expense, covering 54 per cent of the costs, is for direct care staff.

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The review found that expenditures and profits were not evenly distributed between care homes and there was a distinct difference based on type of ownership. Care homes in the not-for profit sector spent 59 per cent of revenues on direct care versus 49 per cent in the for-profit sector.

The Hospital Employees’ Union (HEU) says it’s concerning that for-profit care home operators making big profits while shorting seniors of more than 200,000 funded care hours per year. The union also concluded from the report that under the current funding scheme, for-profit operators spend far less on care aides and other front-line staff than their not-for-profit counterparts.

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“The system is broken, and B.C. seniors and those who care for them are paying the price,” union secretary-business manager Jennifer Whiteside said.

“There is no doubt that the current long-term care funding model contributes to the ongoing retention and recruitment crisis that is depriving seniors of care and putting the health and safety of workers at risk.”

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The HEU is calling for a robust capital plan for the construction of public and non-profit long-term care homes and greater oversight of all publicly-funded facilities.

The audit found less than half of care home operators are required to make their audited financial statements available to the public and no care homes publicly report their expense statements.

For-profit care homes generated 12 times the amount of profit generated in the not-for-profit sector, $34.4 million versus $2.8 million.

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The review also found that for-profit care homes have lower costs than not-for-profit care homes for each worked hour of direct care across all direct care classifications and care aide wages in for-profit care homes can be paid as much as 28 per cent or $6.35 less per hour than the industry standard.

“There is a pattern of for-profit operators paying lower wages,” said Mackenzie. “The degree to which this is impacting their ability to recruit and retain staff is unclear.

“We fund over $200 million a year for building costs across the sector but we do not attempt to determine if the taxpayer is receiving good value for money and paying fair market rates.”

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