30-May-2011 China's ageing population and resulting need for quality aged care means
the experience and expertise of Australian aged care services and
experts is in demand. Megan Stoyles reports.
China is undergoing an explosion in its ageing population and a subsequent demand for retirement and residential aged care services means Australian services and experts are well placed to provide advice - in competition with US and international companies.
However, according to Australians who have entered this exciting, and potentially lucrative market, they need to take a very long term view, accept the potential for misunderstandings, setbacks and losses, and understand the cultural nuances. They must also conduct some market research, and choose their Chinese partners very carefully.
A new study by US gerontologists and Chinese academics published in the Journal of the American Geriatrics Society is the first systematic documentation of the growth and operation of nursing homes in several Chinese cities. It reported a dramatic increase in nursing homes with little regulation or oversight: staff were largely untrained or supervised and few doctors or nurses were employed.
Booming
It reported that a nursing home industry is booming in China as a rapid increase in the proportion of its elderly population forces a nationwide shift from traditional family care to institutional care.
"I get the impression that officials know there is a huge challenge and that the ageing wave is coming. So they say: 'Let's build more beds first. Quality? Problems? We'll worry about that later.' That worries me," co author Zhanlian Feng wrote.
Some Australian aged care providers and services, as well as Aged Care Association Australia (ACAA), are participating in the Chinese aged care market.
David Lane from Australian architectural company ThomsonAdsett has been involved in aged and retirement developments in Asia since the early 1990s.
"Despite being there 15 years, we've only completed one aged care project in China. They're building 50,000 person retirement developments - the size of Toowoomba," he told INsite.
He said the national government in January set a15-year goal for aged development, with the first five years to research the developments.
"Since then we've been getting an influx of Chinese and would-be investors; people web surfing, picking up on our credentials, and wanting to do business.
"We've chosen to work with private sector in areas where there are large publicly listed companies. In the government sector we have to compete against local fee scales and would lose money."
Australia has a current advantage over US retirement developers who are facing major financial problems because of the collapse of the domestic housing market, Lane said.
"Chinese like the Australian attitude anyway, but we're competing against the world there.
"There is the need and demand for all aspects of aged care development and management: software, operating aspects, training and standards as well as building. They don't have much knowledge or idea how to finance or how to regulate the sector."
He said the national government has historically left it to communities (communes), which are used to being self-reliant, and have quite sophisticated arrangements that compare well with Australia.
"Health care is developing rapidly and aged care is coming out of that, as it did in Australia."
However, to those considering expanding to China, Lane warns a good interpreter is essential, "to tell you what you are hearing means". He urges patience, and advises that the aged care development must work and develop from what is there."You can't make them lift standards to what we have; they have to crawl before they walk. They are intelligent, want to learn and want to improve."
Elsewhere, Jim Swinden of Aspex Consulting in Melbourne talks of China's desire to bring 'international models of care' to their services.
Apex last year was a consultant to the 'General's Garden' in Beijing, a large property development along the lines of a 55+ style residential complex marketed with a golf course, recreation facilities, country club, hospital and clinics. The aged care component comprised four buildings each with approximately 70 rooms, ranging from 34 to 116 square meters.
"The General's Garden wanted to apply an international model of care to their aged care services," Swinden said
Working with Grace Xie, a Chinese born Australian RN at Booroondara Aged Services Society (BASS Care), the project involved reviewing design issues, recruitment of a DoN, financial analysis, and model of care and equipment schedules. They also brought Chinese staff to work at BASS Care for five weeks, and adapted operating policies and procedures to take back and apply in Beijing.
Two way street
However, the flow of capital and expertise isn't all going one way. Some Asian investors are buying Australian aged care facilities to obtain expertise here, to use in China and elsewhere.
Jeta Gardens, located on the Gold Coast, is a large retirement development, with residential aged care and community care packages marketed to Chinese speaking Australians. It has been purchased by Malaysian interests, partly due to access intellectual property as well as its local value.
Similarly, a recent article in the UK Financial Times reported that Australian nursing homes were appealing targets for Asian healthcare investors as they increasingly faced western-style diseases and ageing populations.
Australia is Asia's market leader in aged care and many investment, real estate and healthcare services businesses from the ASEAN region could consider jump-starting growth by acquiring Australian know-how, Pawel Suwinski, principal consultant at Frost & Sullivan's Global Healthcare Practice is quoted as saying.
Although Australia's residential and aged care sector is dominated by not-for-profit organizations, there are a number of sizeable for-profit operators that could also attract Asian investor attention. Suwinski cited organizations like Regis, Japara and ARcare, which are rumoured to have been on the market in the past year.
Advice available
To assist regional aged care investment and developments, Singapore-based Janice Chia of Xperiential Events held her annual Ageing Asia Investment forum in April 2010. She commissioned an Asia Pacific Silver Economy Business Report from Span Consulting - the first ageing market industry report that looked at business opportunities across 11 countries in the Asia Pacific.
Over 200 delegates attended from over 90 organisations and 17 countries, including Villa Maria CEO and industry figure Valerie Lyons, who also spoke about Australian developments.
"The opportunity to both present and participate through constructive networking at the Ageing Asia Investment Forum in Singapore was both a positive and enlightening experience", she told INsite.
"There is much that we can learn and share with each other, and an infinite number of business investment opportunities present for all stakeholders."
Little Government assistance
Elsewhere, Lane was closely involved with other aged care services and operators in seeking Asian development opportunities in the 1990s and helped establish the Australian Aged Care Experiences (AACE) Network, which, for a time, was financially assisted by the Department of Health and Ageing, and Austrade. Jason Falinski, Managing Director of CareWell Health, led an industry delegation to Malaysia, Hong Kong, Thailand and the (then) key market of Japan, to investigate opportunities.
AACE activity petered out with industry personnel changes, but Lane said that government support can be valuable. As deputy Prime Minister, Brian Howe attended a Tokyo dinner- thus attracting heavyweight Japanese ,inisterial attendance - which helped seal a contract ThomsonAdsett was after.
Those seeking Chinese contracts are doing it 'on their own', with most government trade support now limited to commodities and rural export assistance rather than skills and professional expertise. The Department currently doesn't see a role for itself in such support.
China is undergoing an explosion in its ageing population and a subsequent demand for retirement and residential aged care services means Australian services and experts are well placed to provide advice - in competition with US and international companies.
However, according to Australians who have entered this exciting, and potentially lucrative market, they need to take a very long term view, accept the potential for misunderstandings, setbacks and losses, and understand the cultural nuances. They must also conduct some market research, and choose their Chinese partners very carefully.
A new study by US gerontologists and Chinese academics published in the Journal of the American Geriatrics Society is the first systematic documentation of the growth and operation of nursing homes in several Chinese cities. It reported a dramatic increase in nursing homes with little regulation or oversight: staff were largely untrained or supervised and few doctors or nurses were employed.
Booming
It reported that a nursing home industry is booming in China as a rapid increase in the proportion of its elderly population forces a nationwide shift from traditional family care to institutional care.
"I get the impression that officials know there is a huge challenge and that the ageing wave is coming. So they say: 'Let's build more beds first. Quality? Problems? We'll worry about that later.' That worries me," co author Zhanlian Feng wrote.
Some Australian aged care providers and services, as well as Aged Care Association Australia (ACAA), are participating in the Chinese aged care market.
David Lane from Australian architectural company ThomsonAdsett has been involved in aged and retirement developments in Asia since the early 1990s.
"Despite being there 15 years, we've only completed one aged care project in China. They're building 50,000 person retirement developments - the size of Toowoomba," he told INsite.
He said the national government in January set a15-year goal for aged development, with the first five years to research the developments.
"Since then we've been getting an influx of Chinese and would-be investors; people web surfing, picking up on our credentials, and wanting to do business.
"We've chosen to work with private sector in areas where there are large publicly listed companies. In the government sector we have to compete against local fee scales and would lose money."
Australia has a current advantage over US retirement developers who are facing major financial problems because of the collapse of the domestic housing market, Lane said.
"Chinese like the Australian attitude anyway, but we're competing against the world there.
"There is the need and demand for all aspects of aged care development and management: software, operating aspects, training and standards as well as building. They don't have much knowledge or idea how to finance or how to regulate the sector."
He said the national government has historically left it to communities (communes), which are used to being self-reliant, and have quite sophisticated arrangements that compare well with Australia.
"Health care is developing rapidly and aged care is coming out of that, as it did in Australia."
However, to those considering expanding to China, Lane warns a good interpreter is essential, "to tell you what you are hearing means". He urges patience, and advises that the aged care development must work and develop from what is there."You can't make them lift standards to what we have; they have to crawl before they walk. They are intelligent, want to learn and want to improve."
Elsewhere, Jim Swinden of Aspex Consulting in Melbourne talks of China's desire to bring 'international models of care' to their services.
Apex last year was a consultant to the 'General's Garden' in Beijing, a large property development along the lines of a 55+ style residential complex marketed with a golf course, recreation facilities, country club, hospital and clinics. The aged care component comprised four buildings each with approximately 70 rooms, ranging from 34 to 116 square meters.
"The General's Garden wanted to apply an international model of care to their aged care services," Swinden said
Working with Grace Xie, a Chinese born Australian RN at Booroondara Aged Services Society (BASS Care), the project involved reviewing design issues, recruitment of a DoN, financial analysis, and model of care and equipment schedules. They also brought Chinese staff to work at BASS Care for five weeks, and adapted operating policies and procedures to take back and apply in Beijing.
Two way street
However, the flow of capital and expertise isn't all going one way. Some Asian investors are buying Australian aged care facilities to obtain expertise here, to use in China and elsewhere.
Jeta Gardens, located on the Gold Coast, is a large retirement development, with residential aged care and community care packages marketed to Chinese speaking Australians. It has been purchased by Malaysian interests, partly due to access intellectual property as well as its local value.
Similarly, a recent article in the UK Financial Times reported that Australian nursing homes were appealing targets for Asian healthcare investors as they increasingly faced western-style diseases and ageing populations.
Australia is Asia's market leader in aged care and many investment, real estate and healthcare services businesses from the ASEAN region could consider jump-starting growth by acquiring Australian know-how, Pawel Suwinski, principal consultant at Frost & Sullivan's Global Healthcare Practice is quoted as saying.
Although Australia's residential and aged care sector is dominated by not-for-profit organizations, there are a number of sizeable for-profit operators that could also attract Asian investor attention. Suwinski cited organizations like Regis, Japara and ARcare, which are rumoured to have been on the market in the past year.
Advice available
To assist regional aged care investment and developments, Singapore-based Janice Chia of Xperiential Events held her annual Ageing Asia Investment forum in April 2010. She commissioned an Asia Pacific Silver Economy Business Report from Span Consulting - the first ageing market industry report that looked at business opportunities across 11 countries in the Asia Pacific.
Over 200 delegates attended from over 90 organisations and 17 countries, including Villa Maria CEO and industry figure Valerie Lyons, who also spoke about Australian developments.
"The opportunity to both present and participate through constructive networking at the Ageing Asia Investment Forum in Singapore was both a positive and enlightening experience", she told INsite.
"There is much that we can learn and share with each other, and an infinite number of business investment opportunities present for all stakeholders."
Little Government assistance
Elsewhere, Lane was closely involved with other aged care services and operators in seeking Asian development opportunities in the 1990s and helped establish the Australian Aged Care Experiences (AACE) Network, which, for a time, was financially assisted by the Department of Health and Ageing, and Austrade. Jason Falinski, Managing Director of CareWell Health, led an industry delegation to Malaysia, Hong Kong, Thailand and the (then) key market of Japan, to investigate opportunities.
AACE activity petered out with industry personnel changes, but Lane said that government support can be valuable. As deputy Prime Minister, Brian Howe attended a Tokyo dinner- thus attracting heavyweight Japanese ,inisterial attendance - which helped seal a contract ThomsonAdsett was after.
Those seeking Chinese contracts are doing it 'on their own', with most government trade support now limited to commodities and rural export assistance rather than skills and professional expertise. The Department currently doesn't see a role for itself in such support.
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