Could COVID’s legacy be one of change?
Perspectives on the lasting effects of COVID-19 differ drastically depending on who you talk to. Policymakers and councils funding the most vulnerable providers warn of real ongoing damage to parts of the health and social care systems. Investors and entrepreneurs, while counting the human and financial cost, can also see some opportunities. Who should you listen to?
Everyone, of course. The failure of some providers financially unfit to weather the covid storm suggests where investment is most needed, and perhaps where some opportunities lie. Healthier homecare businesses with a good balance of geographies could venture into areas with lower tariffs and pick up weaker providers on the brink of collapse, increasing their market share. Care need is only going to increase, and both providers and investors know this.
But challenges remain. In Germany, as in the UK, an increase in wages and costs will have a compressing effect on volumes in the homecare sector and hinder the ability to hire staff in residential care. As one German provider put it, there will be “less services available for the same price”.
Germany is now looking to refinance long-term care, while the UK’s social care system was in the midst of a funding crisis prior to COVID-19. Everyone is grappling with how best to pay for the care of their ageing populations, and the search for solutions is now being expedited by governments Europe-wide.
For investors with millions in dry powder looking for a home, this could be good news. Health and social care are essential services that are only going to increase in need no matter what the economy does, and everyone – from governments to businesses and investors – will need to rally to deliver. One can only hope the current crisis has focused the political will to drive systemic change.
We would welcome your thoughts on this story. Email your views to Anais Charles or call 0207 183 3779.
