Aged care operator's shares dive on funding expectation

Shares in Regis Healthcare have plunged after the aged care operator said the government's latest funding package fell short of expectations.

Regis said on Monday its review found the government's funding package announced on September 12 won't sufficiently offset anticipated increases in staffing costs from a Fair Work Commission ruling and enterprise agreements.

The government uses a model known as the Australian National Aged Care Classification to determine subsidies to providers.

Regis found after analysing the changes it only expected to receive a funding increase of 2.6 per cent, not the headline increase of 4.7 per cent.

As a result, Regis said it expected to make $130 million to $135 million in underlying earnings in 2025/26, which would still represent three to seven per cent