Sept 3 (Reuters) – Shares of Australia’s Regis Healthcare plunged nearly 35% on Thursday after the company said an increase in the government’s funding rate for residential aged care fell well short of inflation across the sector and economy.
Here are some more details:
• The Department of Health, Disability and Ageing increased the Australian National Aged Care Classification (AN-ACC) starting price from A$295.64 ($211.83) to A$303.19, effective October 1, taking the average funding from an estimated A$317 per resident per day (prpd) to about A$325.
• “Regis is disappointed that the funding outcome does not reflect the underlying cost of care,” the aged-care provider said in a statement.
• The 2.55% increase in starting price is below the rise in annual wages for nurses and cost pressures, the aged-care provider added.
• Australia’s consumer inflation reading exceeded forecasts in July as prices jumped due to rising fuel costs, adding to the risk of another interest rate hike.
• Shares plunged as much as 34.6%, marking their lowest level since early August 2024.
• The company said it was increasing room prices and other services to mitigate ongoing margin pressure linked to government funding settings.
• The Department of Health, Disability and Ageing did not immediately respond to a Reuters request for comment.
($1 = 1.3957 Australian dollars)
(Reporting by Jasmeen Ara Shaikh in Bengaluru; Editing by Rashmi Aich)
