In less than two years, Orpea went from zero to No 1 in the Irish nursing homes industry. The Paris-headquartered multinational first established a subsidiary here in December 2019 and immediately launched a purchasing spree.

In January 2020, it completed the acquisition of the TLC group’s five Dublin homes. Later that year, it became a 50 per cent shareholder in the Brindley Federation of Nursing Homes and its 10 locations along the western seaboard as well as in Cos Kildare and Laois. By May 2021, Orpea had fully acquired the Brindley business from previous shareholders including Neal McGroarty, who became the group’s chief executive for Ireland. 

Later that summer, the French giant bought Belmont House, a 160-bed nursing home in south Dublin, and Firstcare, a group of six homes in Dublin and its commuter belt anchored by three separate units among some of the most expensive in the country on one Glasnevin campus. Orpea trumpeted the Belmont House acquisition, in particular, as “the most prestigious establishment in Dublin” with “one of the best reputations nationwide”.

Finally, last November, Orpea acquired two smaller independent businesses: Kilbrew Recuperation and Nursing Care in Ashbourne, Co Meath and Athlunkard House nursing home on the Co Clare side of Limerick city’s outer suburbs.

The exact size of Orpea’s Irish investment to date has not been reported, but accounts published in Ireland to the end of 2020 reveal €134 million worth of acquisitions. Then last year, the group disclosed a €422 million spend on net investments in operating assets relating mostly to Irish deals, as well as a smaller acquisition in Switzerland. Ireland was Orpea’s top target for acquisitions in 2021. It is fair to assume the French group invested more than half a billion euro in this country over the two-year period preceding the scandal triggered by Victor Castanet’s book, which was covered in part 1 of this investigation.

In addition to existing nursing homes, Orpea also built up a development pipeline for new ones. The Firstcare group included planning permission for ten apartments on its Glasnevin campus, and two additional Dublin sites: one in Portmarnock with planning permission for a 151-bed nursing home, and another one in Finglas. Orpea later bought more land on Kilkenny city’s ring road, with planning permission for an 80-bed nursing home, and in Portlaoise for 101 beds.

Mid-2021, with most of these acquisitions confirmed, Orpea became the largest provider of private nursing home care in Ireland. In a presentation to investors, the group announced that its 23 existing homes and two under development would soon total 2,284 beds and exceed €135 million in annual revenue. In 18 months, it had built “a solid development platform in a growing market with 10,000 beds to be built by 2030”.

There is evidence that Orpea Care Ireland (renamed last month Orpea Residences Ireland) was hungry for more deals, with three more shelf companies lined up for action in October 2021 that have yet to report any activity. The group has also been expected to operate a 130-bed planned private rehabilitation hospital in Cork, on a riverside site to be developed by O’Callaghan Properties. 

The irregularities revealed by successive investigations in Orpea's home market in France open the group to scrutiny here. The impact of the French scandal on the group's finances may also affect its bold plans in this country. More fundamentally, Orpea's new group chief executive Laurent Guillot is now openly questioning the merit of past acquisitions. “The malfeasance and ethical misconduct, combined with the excessive real estate and international development undertaken by the previous management team, have seriously affected Orpea's financial situation,” he said in a statement last week.

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According to two sources who worked for Irish nursing homes in two different groups at the time of their takeover by Orpea, one as a frontline employee and the other at senior level, there was a change in management practices towards a more corporate model – with diverging opinions as to whether that was good or bad – but they did not report any evidence of rationing, payroll doctoring or misappropriation of government subsidies as investigated in France.

At the political level, the Oireachtas record indicates that Sinn Féin TD for Kildare North Réada Cronin was the only member to raise questions about Orpea’s Irish operations in February, a few days after the publication of Castanet’s book, “given the group’s decision to fire its chief executive following allegations of abuse and neglect in its France nursing homes due to alleged corporate cost-cutting and profit enhancement”. She got the following reply from Minister of State for Mental Health and Older People Mary Butler:

“[The Health Information and Quality Authority] HIQA has advised my Department that it is aware of the recent reports pertaining to Orpea and its operations in France. HIQA has further advised that Orpea is not the registered provider of any nursing home in Ireland and as such, is not subject to regulation by the Chief Inspector of Social Services. That said, Orpea is the parent company of a significant number of companies registered to operate nursing homes in Ireland, and these companies are therefore subject to the regulatory oversight of the Chief Inspector.

“Orpea Ireland has engaged with the Chief Inspector and provided assurances that the issues under investigation in France have no bearing on operations in Ireland.

“The Chief Inspector has statutory responsibility for independently regulating Nursing Homes for compliance with Regulations and the National Standards for Residential Care Settings for Older People. As the independent regulator of nursing homes, the Chief Inspector determines the appropriate approach and interventions required to monitor and ensure compliance with the regulatory framework. The Chief Inspector will continue to maintain oversight of all nursing homes in Ireland through inspection and the receipt and review of information. My officials and I will continue to engage with HIQA in regard to its functions and activities.”

Also in February, Cronin asked for the amount of taxpayer money paid to Orpea in the past two years. The TD's question was referred to the HSE. Instead of providing figures, an official replied: 

“The HSE do not have a full list of nursing homes acquired by the Orpea Group across the state. The HSE are aware of the following acquisitions by Orpea Group:

• Brindley Healthcare Group
• TLC
• First Choice

This may not give account of all the nursing homes acquired by Orpea Group but are the main nursing homes the HSE are aware the group operate within the state.”

Not only did the official have a partial understanding of Orpea's Irish presence, their mention of "First Choice" also appeared to confuse Firstcare with CareChoice, a separate nursing home operator owned by an unrelated French investor, InfraVia.

Then in May, Cronin asked the Minister for Health whether he was “satisfied that any cost-cutting measures in private nursing homes are not affecting standards of care”. The TD told The Currency that the question related to an Orpea nursing home. “A relative contacted us concerned that there appeared to be cost-cutting as a result of study of practices,” she said.

Butler's reply started with a stock answer on ongoing discussions regarding rising costs at nursing homes, which she has used for similar parliamentary questions since inflation started to rise. The junior minister explained that the fees paid by the state to private nursing homes under the Nursing Home Support Scheme (NHSS, known as Fair Deal) are negotiated by the National Treatment Purchase Fund (NTPF). “The NTPF has statutory independence, and neither I nor the Minister for Health have any role in NHSS price negotiations,” Butler said.

Then she added: “It is also important to reflect that all nursing homes, as registered providers with Hiqa, have well-established obligations under the legal framework in terms of the delivery of safe care to residents. Nursing homes are required, by law, to ensure that procedures consistent with the standards published by Hiqa are implemented by staff.”

Cronin said her concerns were fuelled by a “worrying Hiqa report” into the Mill Lane Manor nursing home in her constituency, acquired by Orpea as part of the Brindley group.

The Currency consulted the latest Hiqa inspection reports for Mill Lane Manor. The home had been found to be compliant or substantially compliant with all regulations checked last year, except one failure to notify incidents properly. Since then, Orpea has increased its stake in Brindley to take full control of Mill Lane Manor. When inspectors returned to Naas on April 5 this year, they found the place had changed – and not for the better.

“While residents and visitors were generally satisfied with the service provided, some expressed concern about staff practices and management of the concerns voiced by residents,” the report reads. “The inspectors found that the complaints records of residents' complaints and concerns were not always promptly managed and responded to in line with regulatory requirements or the centre's own policy.”

While there was adequate staffing, the issues came from higher up. “Lack of governance and management oversight of risks were impacting on the quality and safety of the service provided,” Hiqa reported. “For example, inspectors identified a number of risks during the inspection that had not been identified.” This included fire risks.

A vacancy left an unaddressed gap in the management structure, and “the health care needs of residents were found to be affected by inadequate evidence-based nursing practices and ineffective supervision”. This ranged from the monitoring of nutrition to decisions on which medicines to dispense. Overall, Mill Lane Manor was non-compliant with seven of the 16 regulations inspected this year.

Cronin said her questions reached beyond this individual nursing home. “I am concerned generally about how commodified and profitised our nursing-home care is, with only 20 per cent now in public ownership,” the Sinn Féin TD told The Currency. “I’m concerned about any public money possibly going to private wealth funds for essential care people have paid for in their taxes and social contributions all their lives.”

*****

As evidenced in the issues raised by Cronin and the replies she obtained from various branches of government, questions on the quality of nursing home care invariably lead to Hiqa. The inspections conducted by the authority are an invaluable resource on the standards applied by each regulated nursing home and their evolution over time.

A spokesperson for Hiqa has confirmed to The Currency that the position outlined by Butler above remains unchanged: Orpea is not a registered nursing home provider, but the individual subsidiaries it has acquired are. “The Chief Inspector maintains regular oversight of all nursing homes in Ireland through inspection and the receipt and review of information,” the spokesman said, providing access to individual online files for more information “Our reports include any non-compliances identified during these inspections.”

The Currency has analysed 66 inspection reports covering the 24 homes taken over by Orpea in Ireland and stretching back four years, before and after their acquisition by the French group. These were unannounced inspections, except for one announced at short notice the afternoon before.

On each visit, usually once a year but also on the back of complaints of information received from residents or third parties, inspectors check the home against a selection of regulations and assess whether it is compliant, substantially compliant or non-compliant. They provide explanations and details on any improvements expected after the inspection.

The following chart shows the outcome of the 949 individual compliance checks in the inspection reports analysed by The Currency. Their dates are rebased in relation to the full acquisition of each home by Orpea (transfer of shares and/or appointment of directors), and grouped by year to achieve statistical significance. In the year preceding their acquisition, Orpea also had 50 per cent control of the ten homes in the Brindley group, which account for about half of the inspections conducted during that year.

Overall, inspection reports reveal deteriorating standards after Orpea gained full control of nursing homes. However, in the absence of nationwide compliance statistics from Hiqa, there is no benchmark available to assess whether the trends applied across the industry or only at the locations taken over by the French group.

Its acquisitions coincided with the most severe Covid-19 lockdowns and it is likely that the toll the pandemic took on nursing homes affected the quality of their services nationwide. From additional costs to pressures on recruitment, the care industry has openly acknowledged huge pressures resulting from the pandemic since it was declared a few weeks after Orpea's first Irish acquisition in early 2020. This continued into 2021, which the latest annual report from Hiqa described as “another difficult year for nursing homes”.

“The constant focus on prevention and then, if necessary, escalating to the recognition, management and containment of an outbreak has become a normal part of the day-to-day management of a nursing home. However, this ‘new normal’ does not mitigate the stress and anxiety experienced by residents, families, providers and their staff,” the authority added, highlighting continuing concerns over capacity for planning; staffing, governance and management; and infection control; especially at smaller nursing homes.

We don't know whether Orpea fared better or worse than others in addressing those issues. What the data analysed by The Currency shows is that an acquisition by the French group did not insulate a nursing home from them.

The majority of inspections for which Hiqa reports are available took place in each of the years immediately before and after the acquisition by the Orpea. Only the five homes in the TLC group have been under its control long enough to allow a full round of inspections into the second year of Orpea ownership. As a result, a smaller sample of 78 compliance checks is available for the period after 12 months in the French group. If the drop in compliance observed by Hiqa during these inspections was confirmed over a longer period of operation at other homes acquired by Orpea, it would establish a worrying trend for their residents.

While these aggregate numbers show the overall evolution of standards in Orpea’s expanding Irish business, they also reflect a variety of individual stories. Within each portfolio of nursing homes acquired by Orpea, inspections at different locations can show contrasting results.

To get a better understanding of the changes at play, we need to dig deeper into the Hiqa reports. In each of the three main groups taken over by Orpea in Ireland, we picked a non-representative sample of one nursing home that had improved, and one that had deteriorated. Here is what they tell us.

One home improves, another slides back on Firstcare’s main campus

The oldest Hiqa unannounced inspection report for a nursing home now owned by Orpea relates to a visit conducted in August 2019 at Beneavin Manor, which was part of the Firstcare group later acquired by the French multinational in July 2021. On their 2019 visit, “inspectors observed that at 8pm the number of staff available was not sufficient to supervise the number of residents, and meet their identified needs. It reduced further at 9pm”.

The failure to meet staffing regulations left residents and their families to complain about long response times when they needed assistance. Its knock-on impact meant Beneavin Manor also failed checks on governance and residents’ rights regulations.

The home was again found to be only partly compliant in February 2020. While understaffing had been addressed, new issues had emerged. “Some parts of the centre were in need of a deep clean. Some dust and marks were observed on windowsills and behind handrails. There were food particles on the dining tables and the floor beneath them. A malodour was also observed on one corridor that persisted for almost an hour,” Hiqa reported – and Beneavin Manor had not paid its registration fees in time.

Standards improved by the time of a further inspection in December 2020, which found the home to be compliant or substantially compliant with all regulations checked. But in June 2021, just as the Firstcare group awaited competition clearance for its agreed acquisition by Orpea, inspectors alerted by “unsolicited information” found that the Glasnevin nursing home was short-staffed again. “Five staff members told inspectors that there were times when they found it difficult to complete all of their tasks and duties,” Hiqa reported. Staffing was “inconsistent” and at times “insufficient”, resulting in activities being cancelled and some higher-dependency residents being put to bed at 6.15pm. In addition, “information was not readily available to inspectors during the inspection”.

By November 2021, after five months under Orpea control, inspectors returned to Beneavin Manor and noted that sufficient staffing was restored, thanks to the use of agency workers. There were also improvements in some areas of management, however others “required review to ensure there was adequate oversight and monitoring for all areas of care,” including medication and record keeping. Infection control procedures also failed the inspection.

A new complaint from residents emerged during that inspection regarding food quality: “Inspectors found that the overall satisfaction with the lunch provided was poor, two residents reported they hadn’t received what they had ordered. A number of residents said that they found the food provided ‘poor’ and gave examples of over-use of oil and salt within meals provided,” Hiqa reported, adding that many did not finish their plates.

This appeared to have been solved in June this year, according to the most recently documented inspection of Beneavin Manor, which did not find any non-compliance at the home. One year after its takeover by Orpea, the Glasnevin centre achieved its highest level of compliance on record. “Inspectors found that the management team had improved the systems in place for the effective oversight of the quality and safety of care in the centre,” Hiqa reported. This followed a management decision to close one floor of the building and reduce the number of residents to 48, out of a maximum capacity of 115.

“Inspectors observed that resident records were not stored safely on six occasions during the inspection.”

Yet over the same period, and on the same campus, the separate and larger Beneavin House nursing home was heading in the opposite direction, according to the two inspection reports available from Hiqa.

In December 2020, before Orpea took over, inspectors noted the Christmas cheer and successful efforts by staff to make residents comfortable. The visit was a “short-notice announced” inspection notified the afternoon before, more likely to result in a positive outcome for the nursing home. Yet it was fully staffed by appropriately trained workers, and sample records showed residents had solid care plans in place. Inspectors identified building maintenance issues, including faulting call bells that were repaired on the day. None of these issues were sufficient to declare non-compliance with any regulations, however.

At the end of June 2022, Hiqa returned to Beneavin House, now owned by Orpea. Feedback from the residents was still positive, but inspectors noted that standards had slipped. “Gaps were found in access to mandatory training, oversight and auditing systems, records and contracts for the provision of services,” they wrote. Weak procedures included those on infection control and the storage of documents and medicines – “inspectors observed that resident records were not stored safely on six occasions during the inspection”.

Beneavin House also failed checks against regulations governing the quality of its premises, with some shared rooms found to be too small or not offering adequate privacy, and several areas of disrepair were identified.

Two TLC homes struggle to maintain improvements

TLC Carton in Dublin’s suburb of Raheny was inspected in October 2019, before any involvement by Orpea. Inspectors were following up on complaints received in “six unsolicited pieces of information” and concluded that “a number of these concerns have been substantiated”.

“This centre was not well-governed,” Hiqa reported, with many staff at the recently built home inexperienced and hampered by “ineffective” monitoring procedures. Frequent unplanned absences were not recorded in rosters and it was unclear how they were being covered. Despite these shortcomings, the facilities were in good condition and access to food and healthcare worked well.

The next inspection of TLC Carton took place in September 2020, after Orpea’s takeover of the TLC group. In the meantime, the home had suffered a devastating Covid-19 outbreak in the first wave of the pandemic, during which 13 residents had died.

Despite the crisis, Hiqa found that TLC Carton’s staff was working to better standards than earlier. “Inspectors found there to be a stable management team and that all members of the team were competent in their respective roles,” they found. “Staffing levels had been reviewed in detail once all those off-duty due to Covid-19 related sick leave returned, and the induction of new staff had been completed.”

Residents now had “detailed, person-centred and specific” care plans to address their needs, although inspectors found that some information about them could be clearer. Overall, TLC Carton was compliant or substantially compliant with all regulations checked.

Its most recent inspection last March returned positive conclusions again, with adequate staff numbers and a wide range of activities available to them. Standards had slipped in the area of infection control, however, with reported non-compliance including staff handwashing and separation of potential Covid-19 cases.

Within the same TLC group, meanwhile, a nursing home in Citywest was slipping backwards more sharply.

 “The provider’s governance and management arrangements had failed to substantively address key areas of concern.”

In July 2020, TLC Citywest was less than four months in Orpea ownership and just getting over a Covid-19 outbreak that had been weighing on the residents’ social lives and moods. Inspectors observed efforts by staff to separate “clean zones” from potentially contaminated areas and systematically use clean scrubs and masks. 

Hiqa noted that the nursing home, with support from the wider TLC group, was well prepared for the pandemic with contingency plans for resources like staffing and personal protective equipment. Despite this, attrition during the pandemic left TLC Citywest understaffed, leading to complaints and restrictions in the activities available to residents.

After over one year under Orpea control, TLC Carton was inspected again in May 2021, outside the pressure of a Covid-19 outbreak. “The general feedback from residents was one of satisfaction with the care and services provided in the centre,” which Hiqa found to be compliant or substantially compliant with all regulations checked.

A report on the difficult previous year had been compiled with feedback from residents and their families and areas of improvement identified. Inspectors requested minor improvements in areas such as infection control and access to activities.

In February of this year, however, two years on from TLC Citywest’s acquisition by Orpea, the home failed nearly half of the obligations inspected. “A number of residents and visitors spoken with said that they felt there was inappropriate staffing levels,” Hiqa reported, while inspectors saw empty communal rooms or many residents snoozing without engaging in activities. 

“This centre is part of the Orpea Care Ireland group. The governance structure in place included the Chief Operating Officer and a Regional Director, whom the person in charge reported to. The designated centre also had the support of additional resources through the provider group such as a Quality team. Despite this clearly defined management structure, the provider’s governance and management arrangements had failed to substantively address key areas of concern found on the day of the inspection,” the report reads. 

“There were gaps in staff accessing up-to-date training on safeguarding, fire and infection control,” inspectors found, and improvements requested in a year-old audit of residents’ care plans were not made by a due deadline. “This reflected the poor oversight of care planning seen on the day of the inspection.”

Hiqa also reported that parts of the building were showing signs of wear and tear, from stained floors or furniture to ill-fitted plumbing. Inspectors intervened to ensure residents were given drinks adequately, as for example some were given jugs of water but no glasses. TLC Citywest also failed the infection control inspection, with inappropriate mask-wearing, gaps in the recording of Covid-19 symptoms and a risk of cross-contamination in some areas.

Brindley group: Hiqa cuts capacity to tackle understaffing

At Brookvale Manor in Ballyhaunis, Co Mayo, Hiqa conducted a visit in June 2020, before it had any connection to Orpea. The nursing home had a prior “history of good compliance with regulations” but this inspection, following complaints and a Covid-19 outbreak during which nine deaths occurred, found that it was by then in breach of eight out of nine obligations checked. 

“The governance arrangements and management oversight of this centre were not adequate to ensure safe quality care for residents,” inspectors assessed, adding that “the quality and safety of resident care during the Covid-19 outbreak, up to and including on the day of the inspection, was compromised”. Although residents praised the staff looking after them, they were “despondent” as a result of pandemic restrictions. Issues identified during the inspection ranged from inadequate staffing levels to insufficient training and supervision and poor record-keeping.

“Following the inspection, the provider submitted ‘clock-in’ details for staff which contradicted the information on the rosters supplied to inspectors on the day of inspection,” Hiqa reported. “Inspectors were concerned that frequent changes of person in charge, four changes have been made to this role since October 2018, have contributed to some of the issues,” they added.

As highlighted above, the challenges faced by Brookvale Manor were common to all nursing homes during the pandemic and Hiqa did not assess whether it did better or worse than others in addressing them.

Five months later, a Hiqa team was back at Brookvale Manor to check on progress. By that stage, Orpea was a 50 per cent shareholder in its owner, the Brindley Manor Federation of Nursing Homes. This time, the home was found to be fully compliant with one in four regulations inspected, but it still failed most checks and “significant further action was required”.

Record-keeping had improved but rosters continued to show “low and inconsistent” staffing levels and no progress was reported on infection control. “Inspectors found that fire safety systems in the centre also required review,” they added.

A further visit in April 2021 noted positive feedback from residents and notable improvements in their ability to take part in activities. However, Hiqa had received more “unsolicited information” complaining about Brookvale Manor. “Notwithstanding the improvements set out above, the governance and management of the centre remained poor and did not provide assurance that the management structures in place was [sic] clearly defined or that the provider had appropriate systems in place to ensure that resident care was safe, appropriate, consistent or effectively monitored,” the authority concluded. Issues continued to include fire safety, as well as procedures to deal with risks and incidents.

The latest inspection report available for Brookvale Manor is for a visit conducted in October 2021, five months after Orpea gained full control of the Brindley group. As a result of previous failings, Hiqa had authoritatively reduced the allowable capacity of the nursing home from 57 to 37 (no previous inspection had recorded a higher number of residents than this new capacity). The change and the Orpea takeover were accompanied by a far-reaching renewal of the home’s staff, including its management team. 

“Overall, the findings of this inspection were positive, with improvement noted in general compliance with the regulations. A quality improvement plan was in place and inspectors found that action had been taken to improve the governance and management of the centre,” Hiqa reported. Infection control had improved, with more actions yet to be taken. For the first time in three years, Brookvale Manor complied with the majority of regulations checked. However, there were still staffing issues.

In the case of Brookvale manor, Orpea bought into a nursing home failing most Hiqa compliance checks during the worst of the pandemic, but after the French group had assumed full control, standards were found to improve significantly. This, however, was linked to an enforced reduction in the home’s capacity.

Within the same Brindley group, meanwhile, another example pointed in the opposite direction. 

“Some staff were not up to date with their mandatory training.”

In April 2021, eight months after Orpea became a 50 per cent shareholder in Brindley, its Brentwood Manor nursing home in Letterkenny, Co Donegal was inspected by Hiqa. The authority found that the home was “well governed” and “well resourced”. “Residents said that they were well looked after and that there were enough staff on duty to care for them,” the inspector noted, adding that “they had access to a wide variety of activities across seven days a week and that the activities were in line with what they enjoyed doing”. Checks on Brentwood Manor’s records confirmed that everything was in order, with just one piece of paperwork missing in a patient’s referral – and the need to change some old carpets.

Shortly afterwards, Orpea took full control of the Brindley group. Inspectors returned one year later and found that standards had slipped. 

By May 2022, activities had been reduced to five days a week, with just one allocated staff for the increased population of 55, one short of full capacity. This, and the lack of privacy in some twin rooms, left Brentwood Manor “not compliant” with regulations on residents’ rights. The carpets had been changed, but the resulting gaps left in floor coverings and under doors were now one of several fire safety insufficiencies detected. 

In addition, “some staff were not up to date with their mandatory training” and deputising arrangements when the person in charge was absent did not comply with regulations. The layout of the home had also undergone changes that had not been notified to Hiqa as they should have.

The examples above include a number of situations where a home acquired by Orpea appears to maintain compliance with regulations at first, or even improve in those cases where many breaches occurred under previous owners. Over time, however, standards often tend to slip below the regulatory minimum in a number of areas, which may be linked to the impact of Covid-19 in parallel to the group's Irish expansion. 

Despite the management shortcomings identified by various Hiqa inspectors, one common feature across all reports is the praise residents lavish on the staff looking after them. Inspectors also noted the kind and caring attitudes of workers in all reports examined by The Currency.

*****

How does the picture of regulatory compliance emerging from Irish nursing homes acquired by Orpea compare with the group’s assurances, relayed by Butler to the Oireachtas, that “the issues under investigation in France have no bearing on operations in Ireland”; with former staff comments that Orpea’s expansion was accompanied by less personalised and more corporate management practices; or with Cronin’s concerns that older people’s care was becoming “commodified”?

It is fair to say that the occurrences of non-compliance reported by Hiqa have not mirrored the wholesale irregularities revealed in France. None of the group’s Irish homes was found to offer insufficient food or incontinence pads. Orpea homes were in breach of food and nutrition regulations only once in Ireland. This was during an inspection of the Cara Care Centre in Santry, Dublin in March 2022, where inspectors found that “each resident did not have access to a safe supply of fresh drinking water at all times” and those in need of a special diet did not always have access to an appropriate menu or to the full care prescribed by dietitians.

According to a person familiar with Orpea’s Irish business, the group came to Ireland recently enough that the nursing homes it acquired here had not been sufficiently integrated into the group’s management structures, IT and procurement systems to become “contaminated” with its headquarters’ bad practices before the scandal erupted in France.

This does not mean, however, that there weren’t signs pointing towards an evolution in that direction.

After Hiqa enforced a reduced capacity at Brookvale Manor as detailed above, the number of staff present on the day of the next inspection was deemed “substantially compliant” but the details still weren’t right. “The numbers of healthcare assistants available did not align with the numbers committed to by the provider in the statement of purpose for the number of residents in the centre,” inspectors noted. Such discrepancies between staff numbers committed and actually deployed in each category of personnel have echoes of the problems identified in France, where Orpea was found to shift employees between contracts and positions to give the illusion of compliance.

Regional directors take control

At TLC Citywest, staff vacancies were expected to be filled with agency staff but “inspectors were told that agency use had to be pre-approved by the Regional Director. However inspectors were told that short-term cover could be authorised by the local management team if required, however this was not seen to occur on the day of the inspection.” As a result, “the centre was not appropriately resourced”.

This situation mirrors the problematic “strongly centralised organisation” exposed by Castanet’s book in France and confirmed by a government investigation there, with decision-making powers transferred away from individual homes into the hands of regional directors incentivised to achieve purely financial targets. French regional directors attended regular meetings, described by Castanet’s sources as brutal bullying sessions, where they reported to the all-powerful operations director Jean-Claude Brdenk who was fired in the wake of the scandal.

The Currency is aware of the appointment of two regional directors by Orpea in Ireland in August 2021, one for the greater Dublin region and one for the western regions. Since that date, Hiqa reports have chronicled their rising power in nursing homes controlled by the group.

Insufficient infection control at Beneavin Lodged in October 2021? “A new isolation unit has been identified, discussed and agreed with the regional director.” Poor risk assessments at Belmont House the following month? “The regional director agreed to immediately address this omission on the risk register.” The regional director became such a familiar figure in that nursing home that they happened to be there the next time inspectors showed up, unannounced, last February. “Following the opening meeting the inspector reviewed the premises and the person in charge and the regional director accompanied the inspector whilst doing this. The inspector noted they appeared well known to the residents and staff and were seen to have a good rapport with all spoken to,” Hiqa reported.

By May of this year, a report from Millbrae Lodge confirmed the central role regional directors had taken in the chain of command: “The person in charge reports to a regional director, that in turn reports to the chief operating officer.” Almost all improvements agreed upon after a Hiqa inspection at an Orpea nursing home are now placed under the responsibility or joint responsibility of a regional director. 

Aside from the difficulty in recruiting agency staff reported at TLC Citywest, regional directors' expanding control over the management of individual nursing homes has not at this stage resulted in reported negative impacts on the quality of care. The French precedent, however, has shown that Orpea's regional directors can become conduits to pursue profitability above any other consideration if this is company policy.

Recovering occupancy far from group target rate

One of the avenues to achieve such profitability in France was reported to be a relentless focus on occupancy rates. With this in mind, The Currency compiled capacity and residents’ numbers from all Hiqa reports analysed. The data shows that Orpea bought Irish nursing homes that were losing occupancy and gradually turned this indicator around following their acquisition. 

Orpea’s occupancy rate in Ireland received an indirect boost from the enforcement decision by the Chief Inspector of Social Services to cut the registered capacity of Brookvale Manor “as a result of the continued non-compliance found on these inspections,” within days of Orpea gaining full control of the Co Mayo home. As detailed above, Orpea itself also decided to reduce the capacity of Beneavin Manor by closing off one floor of the Glasnevin home to compensate for recurrent understaffing. In this case, however, the home’s registered capacity did not change, leading to a fall in its occupancy rate instead.

At the group level, as detailed in part 1 yesterday, Orpea experienced a drop in occupancy rates during pandemic restrictions and has been scrambling to restore this metric ever since across its nursing homes worldwide. This is crucial to improving its profitability and facing the financial crunch caused by rising debt and operating costs. A note to the group's annual accounts suggests that it usually targets 95 per cent occupancy.

Fair Deal protection from procurement and payroll fraud

One aspect not covered by Hiqa inspections is a nursing home’s sound management of taxpayers’ money. Over 80 per cent of private nursing home residents in Ireland are funded through the Fair Deal scheme, under which the state pays for their care and recovers part of the costs from them. Private nursing homes received €1.4 billion in Fair Deal fees last year.

As detailed in part 1, French investigations have uncovered several strands of irregularities in the use of public funds by Orpea, with €55.8 million already clawed back by the authorities. The group had exploited discrepancies between the subsidies its nursing homes received per resident, the expenditure then reported to the French authorities to match the subsidies advanced, and the actual costs supported by the group net of end-of-year rebates received from its suppliers. This was facilitated by the complexity of the French funding system, where nursing home operators are not allowed to earn a margin on subsidised care and medical services, and generate their own revenue from the accommodation charges paid by residents only.

In Ireland, the National Treatment Purchase Fund runs the financial aspects of the Fair Deal scheme. “The NTPF function under the Fair Deal scheme is to negotiate with proprietors of private and voluntary nursing homes regarding the price of long-term residential care services. The NTPF negotiates with respect to each nursing home wishing to participate in the scheme on an individual basis,” a spokesman told The Currency. “The NTPF does not comment on its negotiations with individual nursing homes.”

The spokesman did not reply to repeated questions seeking to establish whether a nursing home operator had to account for expenses to match the costs agreed with the NTPF at the end of each year, as was the case in France. However, this does not seem to be the case here. There is no mention of such reporting in a detailed examination of the Fair Deal scheme published by the Comptroller and Auditor General in 2020.

Instead, the audit indicated that the maximum weekly price agreed between the NTPF and each nursing home operator was set for the duration of their contract, and it was then up to each operator to run their business within this envelope. The Comptroller and Auditor General explained:

“Prior to entering into negotiations with a nursing home, the NTPF carries out a financial analysis of the information provided. While there is no standardised approach to completing the analysis, it typically includes:

• an analysis of room occupancy rates;
• a calculation of the nursing home’s weekly unit cost derived from the nursing home’s operating costs allowable under the Scheme;
• other information on the nursing home’s turnover, profit before interest and tax and finance costs.”

Instead of the separation between subsidised, non-profit services and for-profit accommodation paid for by residents in France, the Irish Fair Deal scheme includes the profit targeted by the operator in the negotiation and covers costs in one weekly payment with partial cost recovery from residents later. The Comptroller and Auditor General added:

“The NTPF has stated that the following criteria are also considered:

• costs reasonably and prudently incurred by the nursing home and evidence of value for money;
• price(s) previously charged;
• the local market price;
• budgetary constraints and the obligation on the State to use resources responsibly.”

And, unlike Hiqa, the audit shows that NTPF negotiators formally ask nursing home operators about their ownership structure and know when they are dealing with parts of a larger group.

This model seems to allow less room for abuse than identified in France, and relies more heavily on market competition between operators to offer competitive rates and secure contracts from the NTPF. There is no incentive, for example, to pay suppliers in full in order to present invoices for inspection and then charge them kickbacks later, because the authorities in Ireland don’t check invoices in the first place. Similarly, doctoring payroll data would not present as much of an advantage here as subsidies are not linked to specific numbers of staff in any particular category of personnel.

Instead, it falls to Hiqa to verify that each nursing home operates to the required standards.

In the long term, a nursing home operator could be tempted to inflate reported costs in a bid to justify higher prices at the time of its next Fair Deal contract renewal. There is no evidence, however, that Orpea has engaged in this. To double check, The Currency compared the weekly Fair Deal prices agreed between the NTPF and nursing homes owned by Orpea with those outside the group, both in October 2020 before most of Orpea’s Irish acquisitions (and under Fair Deal contracts negotiated before the group’s involvement) and at August 2022’s latest published rates. 

For a single room, the nursing homes now in Orpea’s portfolio charged on average €1,256 per week in Dublin and €1,013 outside Dublin in 2020, both around 5 per cent above national averages. This year, with the French multinational in control of their Fair Deal contracts, their average weekly charges have increased to €1,276 in Dublin and €1,046 elsewhere. In the meantime, the premium they enjoyed over the national average has dropped below 3 per cent. If anything, Orpea’s takeover appears to have reduced the relative burden on the taxpayer from the nursing homes it has acquired.

A €1,000 joining bonus to tackle labour shortages

While the group was found to have manipulated trade union representation in its nursing homes and hospitals in France, The Currency has found no evidence of similar practices in Ireland. A trade union organiser commented that the private nursing home industry was traditionally “anti-union”, but had no specific complaints about Orpea.

The group, however, risks suffering from the fallout of the reputational scandal that erupted in France as it faces a sector-wide labour shortage. While Orpea has not rolled out its brand to market its services to customers in Ireland, instead maintaining existing names like Brindley, TLC or Firstcare, it has been conducting a recruitment drive under the Orpea banner from social media to college campuses and overseas job fairs. 

This was still the case in a job advert for healthcare assistants circulated under Orpea Group Ireland's name in Limerick this autumn – complete with a €1,000 joining bonus for any successful applicants. The hourly pay on offer was €11.

One greenfield site comes to life

The most severe impact of the crisis that has engulfed Orpea this year on its Irish operation is, in fact, the sudden stalling of its expansion in this country. From almost quarterly acquisitions in 2020 and 2021, its M&A activity hit a wall on the day the first allegations of irregularities emerged in France. No deal has been announced since then.

Four months ago, the group closed Oughterard Manor in Co Galway, though this was not a core asset and the closure may not yet be a sign of strategic retrenchment. The HSE had previously taken over the 41-bed nursing home because of poor management by a previous owner, and Brindley had subsequently agreed to run it prior to its acquisition by Orpea.

The Currency understands that the refinance secured at the group level in June and detailed in part 1 had unfrozen the three greenfield projects for which it owns land with planning permission in Portmarnock, Kilkenny and Portlaoise. The group issued a commencement notice for works on the Portmarnock site at the end of August – the first formal sign of activity on any of these sites.

The recent news that the group is again locked in negotiations with its bankers, however, means all future developments will remain up in the air until Orpea secures longer-term finance. A fresh debt deal is needed to support the group's “transformation plan” due on November 15, which will reveal more information about the types of assets earmarked for development or disposal. We may know more about the future of Orpea in Ireland at that point.

The developer of Orpea’s proposed private rehab hospital in Cork, meanwhile, continues to move the project through the planning process. An Bord Pleanála is due to rule on the proposal in the new year after it received appeals both from O’Callaghan Properties against conditions imposed by Cork City Council for the development, and from the site’s neighbour Southern Milling, who fears the disruption associated with the hospital’s construction would kill its business employing 60 people in feed production on Cork’s South Docks.

It is not certain at this point if or when O’Callaghan will build the project. By that point, Orpea may have restored its financial health and taken over the hospital as planned. Or it may have faded away from Ireland in the midst of the multi-billion-euro asset disposals it must now deliver to reassure its creditors.

Further reading

A Parisian care giant is gobbling up Irish nursing homes. What is its strategy and what does it mean for the sector?

Inside Ireland’s nursing home sector: The main players, the profits and the deals