Falling admissions impact Four Seasons Health Care

Jeremy Richardson, Four Seasons Health Care chief executive

Admissions at Four Seasons Health Care dropped more than 50% at one point this month due to the impact of Covid-19.

At this time of year, the operator usually records 110 admissions per week, but this declined to a low point of 50 earlier this month. Occupancy since mid-March when it stood at 87.9% has reduced to 80.8%.

It has since started to move up but Jeremy Richardson, chief executive of Four Seasons, told a conference call Covid-19 would continue to impact the company ‘significantly’ over the remainder of May and June.

Richardson said: ‘Not surprisingly along with the rest of the sector we have been hit quite hard. The death rate since the beginning of April has increased quite significantly.’

At its peak 60% of care homes had Covid-19 and as of this week there had been 490 suspected or confirmed deaths at its properties due to the virus.

In the second week in April there were more than 200 deaths against a seasonal average 80. This has declined to 107 in the most recent week, Richardson said.

Between the beginning of March to the end of April, the business spent £2.5m on personal protective equipment (PPE) compared to £200,000 during a normal year.

Payroll costs have also been impacted because of shielding and self-isolation, which pushed staff absenteeism to just under 11% at its peak. This now stands at 6.9%.

Richardson said: ‘We estimate Covid will increase our agency payroll costs by in excess of £1m over the course of the crisis.’

Its trading update said over the coming months the potential financial impact of Covid-19 could be around £15m this year. ‘The actual impact could be higher once the full impact of the virus is known,’ it said.

In December, Four Seasons Health Care Group consolidated its Four Seasons and brighterkind businesses into a single management team to create one care home operation.

Richardson, the chief executive officer of brighterkind, was appointed CEO of the unified business.

Prior to Covid-19, he said the restructure involved implementing a ‘can do attitude’ at Four Seasons.

He said: ‘My observations having taken over the Four Seasons business was that it had… become complicated, some of the messaging within the business was confused, and there was a belief that the business was trying to do too many things all at once.

‘In essence what we’re trying to do is keep things simple.’

Richardson has highlighted three objectives that he will concentrate on to help turn Four Seasons around; team and resident experience; improvement in care quality; and financial performance.

In the first quarter of the year, before the impact of coronavirus, occupancy grew 0.9% to 87.9%, agency payroll started to fall and a ‘much tighter alignment’ between the operations teams and the care quality support function was developing, Richardson said.

‘More importantly we have started to see a real cultural change in the business… We’ve injected real pace into decision making, we’ve simplified and stripped back some of the things that were perhaps preventing the business from reaching or getting to its full potential.’