Aged care providers cancel 2,000 beds amid funding concerns

Australian aged care providers are cancelling plans for over 2,000 new beds following a decision to limit the National Aged Care Classification (AN-ACC) price increase to 2.55 per cent. This rate hike, effective October 1, comes despite rising inflation and a 4.75 per cent increase in award wages. Industry peak body Ageing Australia reports that 62 per cent of aged care homes are already operating at a loss.

Major providers have already halted or paused developments, including Whiddon, Regis Aged Care, and Abound Communities. This reduction in capacity occurs as demand rises; it is estimated that Australia requires 10,000 new beds annually to keep pace, yet only 800 were built in 2024-25.

The shortage is contributing to a growing hospital crisis known as ‘bed block.’ In New South Wales, approximately 1,300 patients are currently stranded in public hospitals awaiting government-funded aged care or NDIS placements. NSW Health Minister Ryan Park warned that these numbers are growing at an ‘unprecedented and unsustainable level,’ noting that one in eight emergency department accessible beds in the state is currently unavailable due to patients awaiting discharge to supported care.