Hikurangi Residential Home board considers its future

The Hikurangi Residential Home board begins a consultation process today with its staff and residents to discuss the future of Hikurangi.
Hikurangi board chair Pam Erni has confirmed the board of trustees has been assessing the home’s financial status resulting from some concerns raised by the draft financial budget for 2012/13.
“The previous year’s losses have been met from cash reserves but this is no longer sustainable,” Mrs Erni says. “The board is working through the financial issues in an endeavour to resolve the situation but unless there is a dramatic turnaround in Hikurangi’s fortunes it is likely the home may have to close.”
Mrs Erni says there are a number of factors contributing to the situation. Fluctuating occupancy rates over the past five years is one. Rising costs, future earthquake strengthening liabilities and the amount of ongoing expenditure necessary to keep an aging building in tip-top condition are other factors.
“There is also a widening gap between the funding provided through DHBs for rest home care and the actual cost of provision to the level required for increasingly frail elderly residents,” she says.
“The board and management have explored a number of options such as moving to providing hospital level care in an endeavour to increase revenue. But these and other similar options were not considered financially viable due to the cost of implementing such changes.
“And we are mindful of the fact that other providers in the DHB area are moving, or have moved, to providing that level of care.”
WDHB service and business planning general manager Tracey Schiebli says Mrs Erni had met with her and outlined the board’s financial difficulties, and its intention to consult with staff and residents on possible actions that might reverse the current situation.
Ms Schiebli says the Hikurangi board are aware of their contractual obligations to keep the WDHB (their principle funder) well informed and to work together once a decision has been made. 
She says while sad that the Hikurangi board is facing possible closure she respects their decision and their determination that the first people informed of this were the residents, their families and staff.
 “Obviously news of a possible closure will be very hard for everyone concerned and more so when it comes so soon after the closure of the Aubert Home of Compassion,” Ms Schiebli says.
“We are mindful that three Home of Compassion residents who relocated to Hikurangi may now face a second move which no-one foresaw at the time or would wish upon them.
“Regrettably, smaller rest homes throughout the country are under strain as the rest home market undergoes change.
“Some commentators ask if DHBs are providing adequate funding to rest home providers but clearly, the larger the rest home, the more financially viable they become. It’s all about economies of scale.
“Rest homes are expensive to run and the smaller the number of beds they have, the harder it is to make ends meet.”
Ms Schiebli says the next 12 months will be challenging for the WDHB as it works with Whanganui age care facilities and providers such as GPs and Hospice Wanganui to meet the need for residential care with less providers. To address the possible shortfall in Whanganui, if Hikurangi (a 39-bed facility) closes, the WDHB is looking to increase its support to people who can, or may wish to, remain in their homes for longer.
In partnership with a working group that includes Access Ability, Hospice Wanganui and primary and secondary care clinicians, ‘enhanced packages of care’ are being developed as alternative options for patients who wish to, or could, remain living in their homes or alternative residential options. After hours community nursing support is included in the package designed to lift some of the pressure off aged care residential beds.
“The WDHB and service providers learnt a great deal while working through the Home of Compassion closure,” Ms Schiebli says. “While we were delighted that no residents had to be relocated out of the district against their wishes it became clear that if bed numbers were strained in the future a long-term strategy would be needed. Enabling and encouraging more people to live independently in their own home is very much our focus.”
Ms Schiebli says the WDHB will be doing all it can to help Hikurangi manage the situation as it unfolds in a manner that minimises distress to all parties.