The latest care minute results show the downward trend that emerged after October has continued. More homes are missing their care minute targets, more providers are exposed to the reduced base care tariff, and the Care Minute Supplement will reduce again from July.
The more important question is whether provider cost bases are moving with that revenue. The data suggests they are not. While funding has softened, average delivered care minutes have remained almost unchanged, creating growing pressure on operating margins. These results deserve close attention from both finance and clinical leaders.
October 2025 was the turning point
For most of the past two years, the sector continued to improve. The proportion of homes achieving three or more staffing stars rose steadily, peaking at around 88 per cent during the July 2025 quarter.
October marked a significant turning point. Homes were required to meet both a total direct care minute target and a separate registered nurse target, while the base care tariff was reduced at the same time. Together, these changes produced the first significant reversal in care minute compliance since mandatory care minutes were introduced.
The proportion of homes meeting their staffing targets fell to around 73 per cent during the October quarter, signalling a clear shift in sector performance.
The January quarter continued the trend
Rather than recovering, sector performance declined further.
During the October to December quarter, 65.3 per cent of homes met their care minute responsibility, leaving 849 homes below target. By the January to March quarter, compliance had fallen again to 63.6 per cent, with 931 homes now missing their targets. More than one in three homes nationally now sit below the required threshold, exposing them to the reduced base care tariff.
Looking beyond the headline result provides additional insight. Among the homes we tracked across both quarters, 257 moved out of compliance, while only 232 returned to compliance. A further 591 homes remained below target across both quarters, indicating a persistent group that has not yet closed the gap.
This suggests the decline is not simply a short-term adjustment following the October policy changes, but an ongoing trend that providers need to monitor closely.
Supplement revenue will reduce again
The financial impact extends beyond the reduced base care tariff.
With overall compliance continuing to fall, the Care Minute Supplement payable from July will decrease compared with the rates that applied during the April quarter. Homes meeting their care minute responsibilities will continue to receive the full supplement, while those below target face both reduced supplement revenue and continued exposure to the reduced base care tariff.
Across the sector, revenue linked to care minutes is continuing to soften.
The revenue-cost gap
The most significant finding is that provider costs have remained largely unchanged despite declining funding.
Across the homes we tracked in both quarters, average delivered care minutes remained virtually unchanged, moving from 224.0 to 223.8 minutes per resident per day. In practical terms, provider rosters remained largely unchanged between the December and March quarters, despite the reduction in associated funding.
This disconnect between funding and roster cost can materially impact financial performance. Revenue has declined, but many providers have not adjusted staffing levels accordingly. A home can therefore be both below its care minute targets and spending more on labour than its funded care minutes support.
Without clear visibility of both funding performance and roster efficiency, this pressure can remain hidden until financial results begin to deteriorate.
What providers should do now
The providers best placed to respond will be those that understand two things clearly.
First, they need visibility of their funding exposure—how far below target each home sits, the impact on Care Minute Supplement and base care tariff revenue, and whether performance is improving or declining quarter by quarter.
Second, they need confidence that roster expenditure remains aligned with funded care minutes. Reviewing funding or labour costs in isolation risks missing the true financial picture.
Mirus helps providers bring these two views together. We quantify exposure to Care Minute Supplement and base care tariff reductions across every home, then identify where roster costs have drifted away from funded care minutes. That gives providers the insight they need to make informed decisions before the next reporting period and protect both compliance and financial performance.
