In the wake of widespread allegations of neglect throughout the aged care sector, attracting reports, investigations and glaring admissions of failure, major Australian residential care companies have seen their stock value plummet and tens of million dollars of shares lost.
A confluence of events has caused this dramatic drop, with a Four Corners investigation into treatment of elderly residents, the announcement of a royal commission and the Prime Minister’s comments on the situation coming all at the start of the week – causing some aged care companies to lose more than 20% of their value.
Japara Healthcare, with over 40 aged care homes throughout Australia, saw a 21% drop in value. Meanwhile, Aveo Group, which house over 13,000 residents nationwide, saw a 14% decline. Regis Healthcare has also seen a loss of 20% in value.
These three companie house countless elderly Australian residents, and between them lost roughly $50 million in shares on Monday.
The recent Four Corners report detailed overworked staff resulting in dangerous neglect, patients sustaining injuries, going without food and receiving minimal emotional or hygienic care.
Speaking on the crisis on the Today Show, Prime Minister Scott Morrison’s said, “I acknowledge the system is broken.
“I acknowledge a royal commission is necessary to understand the full extent of the problem that our increased policing work in the sector has been revealing, and that’s why we need a royal commission. I mean, we’re lifting the standards. We’re policing the standards. The royal commission is an addition to all that work.”
In the wake of this crisis, this royal commission will seek to identify the root of the issue, with potential legislative reform forthcoming.