[New] Care Home Insolvencies Jump 52% in a Year as Running Costs Spiral

Insolvencies involving residential care businesses have increased 59% in the past year from 56 to 85, as they struggle to cope with mounting debt servicing costs and steep rises in energy bills says Mazars, the international audit, tax, and advisory firm

Rebecca Dacre Partner at Mazars says:

“The margins which care homes operate to have always been relatively thin Now rising costs are pushing an increasing number into insolvency

“A lot of care homes had taken on significant levels of debt on the properties they own all of which has become much more expensive to service as interest rates have risen ”

Many care providers have simply been unable to cope with surging energy and food prices increasing the basic costs of care combined with increased staffing costs in a sector where costs cannot easily be cut much further

One issue which has been frequently raised is the difficulty of discharging vulnerable patients from hospitals due to a lack of space in care homes

Rebecca Dacre adds: