Private Care Home Profit Made Simple

Lenin offers this simple, straighforward explanation of how private equity trusts investors receive  a guaranteed return (profit). Why else would they invest?

Consider a 40 bed care home,  in a working class area ie with no private paying residents.  The home takes in £1 million a year from the government.

From that, if owned by a private equity group such as Four Seasons ...

£200 thousand goes to the management fee.

£100 thousand goes to the investors.

£100 thousand goes to the bank.

Therefore, only £600 thousand remaIns.  Staff wages account for 60% of this.

Therefore, £240 thousand remains.  Half is for fixed costs such as food or electricity.  The rest 12% is sheer profit.

Consider however, this is if the home is full.  The average occupancy for care homes is 82%.

We are not told the true cost of care.

Businesses are like pigs in a trough.


The government dish out the swill.

Care costs largely cover debt or profit. 

Lenin Nightingale 21 August 2015


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