Over a quarter of care homes in the UK are still in crippling debt according to a study carried out by Company Watch, with over 5,000 homes considered to be financially distressed. The study follows on from research conducted in 2013 and shows very little improvement in the sector.
The biggest concerns raised were for care home companies with liabilities greater than their assets. These companies, name 'zombies', have risen in over a year by 0.7% up to 14.9% of all care homes, and have a total negative net worth of £277 million.
The main findings of the study
- The combined net liabilities of zombie care home companies rose from just under £200 million to £277 million, an increase of 27.6% since August 2013.
- The average amount of debt for each zombie care home surveyed in the UK works out at over £300,000
- The average debt per care home company in the UK however has fallen by 12% from £812,000 to £714,000, showing the polarisation of the sector
- 1,659, around 30% of care home operators, are deemed to be in critical debt by Company Watch
Further Action
Contact Raeside and Chisholm for further specialist and personal legal advice with any matter regarding the elderly.