Annual Reportfor the year ended 31 March 2019

TRUST INFORMATION

Registered Office97 Great South Road Greenlane Auckland

TrusteesGraeme Edmond (Chairman)Robyn BeguelyLynne LaneRaewyn LovettStuart WilliamsBruce WaldinMax Robins (Executive Trustee)

AuditorsRSM Hayes

BankersASB Bank Ltd

SolicitorsGlaister Ennor

CHT Annual Report | 1

Welcome to the CHT Healthcare Trust

2019 Annual Report

2 | CHT Annual Report

Facility locations

Auckland DHB

3 Facilities

188 Beds

135 Staff

Counties Manukau DHB

4 Facilities

281 Beds

201 Staff

Waitemata DHB

5 Facilities

287 Beds

211 Staff

Bay of Plenty DHB

3 Facilities

160 Beds

102 Staff

Waikato DHB

1 Facility

60 Beds

47 Staff

ValuesCHT Healthcare Trust aims to ensure a truly resident focused experience in our facilities by building on our five values:

Companionship ComfortCompassion Care Connected

Beds by care type

Rest Home 265Hospital 631Dementia Care 80

976

Chairman and Chief Executive’s ReportCHT’s Purpose

CHT has operated in the New Zealand residential aged care market since 1962. We were established when the government of the day incentivised charitable organisations to enter the market to address gaps that were not being met by the private sector. This provided a clear charitable purpose and has influenced our decision making ever since. At various times CHT has undertaken other work of a charitable nature in accordance with our purpose.

The residential aged care market is now dominated by private providers and we see an opportunity to provide a broader contribution to aged care in New Zealand by setting up the CHT Aged Care Fund which will receive its first applications in 2019.

The fund has been established to provide grants to organisations or individuals who are advancing the interests of older people through research or other innovations. This fund reinforces CHT’s strong values focusing on the needs of our residents and the wider interests of older people.

CHT Chief Executive Max Robins, CHT Chairman Graeme Edmond

CHT Annual Report | 3

4 | CHT Annual Report

Workforce

The year has been very challenging with workforce being foremost in our minds. The pay equity settlement for healthcare assistants and activities coordinators has statutory wage increases funded by the government over the five years the legislation remains in place, lifting wage rates to levels that recognise the skill and contribution of these workers. The environment has been less beneficial for registered nurses working in the sector with changes in immigration policy, the removal of nurses from the long term skill shortage list, and widening of the gap between DHB and aged care nurses wage rates resulting from the DHB nurses MECA.

Fortunately the immigration policy has been reversed and DHBs have included a provision in funding for the 2019/20 year to restore registered nurse pay rates to pre-MECA relativities. These decisions will assist in stabilising this critical part of our workforce and providing continuity of care to our residents; a key quality indicator in residential care.

The sector is still seeking pay parity for aged care nurses with DHB nurses in recognition of the common labour market we draw from.

We have a clear career pathway for our nurses at CHT. In this year’s report we feature some of those nurses who have progressed into leadership roles to illustrate CHT’s commitment to diversity and promotion from within.

Our training programme was enhanced this year with the implementation of the on-line Altura training system. This has been a significant improvement, making training easily accessible by all staff and delivering training in an attractive, modern format.

The underlying software is used to develop in house training in addition to the aged care programmes provided through Altura.

This training system enhances the training provided by CareerForce for activities co-ordinators and healthcare assistants as they progress through the New Zealand Qualification framework. Through qualification and recognition of prior learning 31% of our healthcare assistants are now at Level 4 on the qualification framework.

Quality Improvements

We continue to see improvements across nearly all of our quality indicators with falls reduction programmes, electronic medication management and our REAP programme responding to weight loss. Adverse events rates across the group peaked as we purchased new facilities and then after applying CHT’s quality management systems, the underling downward trend in adverse events has taken effect.

Residential Aged Care Providers are required to have regular Certification Audits against the Health and Disability Services Standards. Following their recent audit, CHT Glynavon in Te Puke was awarded four years certification. In their report, the auditors noted:

“The residents, relatives and general practitioner spoke highly of the care and service provided at CHT Glynavon. The service has a well-established quality system that identifies ongoing quality improvement.”

Two more of our sites, CHT Royal Oak, CHT Hillcrest were also awarded four years certification this year.

In their report about CHT Royal Oak the auditors stated:

“Staff ensure that care is provided in a way that focuses on the individual, values residents’ autonomy and maintains their privacy and choice.”

CHT Hillcrest was commended by auditors who stated:

“The service is commended for achieving two continued improvement ratings around good practice and community involvement.

Information about services provided is readily available to residents and families. Policies are implemented to support rights such as: privacy, dignity, abuse and neglect, culture, values and beliefs, complaints, advocacy and informed consent. Care planning accommodates individual choices of residents and/or their family/whanau. Family stated they are kept well informed on their relative’s health status.“

Capital Development

CHT is undertaking the most significant capital development programme in our history with three facilities being completely replaced, and the oldest wing on a fourth being rebuilt.

The first stage of the rebuild of CHT Halldene in Red Beach delivered 32 beds in October and the remaining 28 beds programmed for completion in October 2019.

CHT Halldene - Stage 1

CHT Annual Report | 5

The first 28 bed stage of CHT Carnarvon in Henderson was occupied in March with the remaining 32 beds being constructed in 2 stages scheduled for completion in March of 2020.

Redevelopment of CHT Acacia Park, acquired in 2015, commenced in January with the first stage programmed for completion in November 2019 and total project completion in April 2021.

Artists Impression of CHT Acacia Park Development

CHT Bernadette in Mt Maunganui was built over several decades with the oldest wing unsuitable for renovation. The first stage of this project, renovation of Matakana, the newest block in the building was completed in March. This work overlapped with demolition of the old wing. The replacement building is scheduled for completion in October and refurbishment of the remaining wing programmed for completion in May 2020.

Planning has commenced for the redevelopment of CHT Glynavon in Te Puke, where CHT will build its first serviced apartments in addition to replacing the existing care beds.

The Young Group of Companies are partnering with CHT on the development of a facility in Tuakau, which CHT will lease from Young Group.

Financial Performance

CHT has increased our bank facility to $65m to finance our capital development programme with term debt of $25m at balance date. Gearing remains at a conservative level at 18%. Total assets increased by $12m to $139m reflecting CHT’s investment in development of our facilities.

Utilisation rates of aged residential care are steadily declining as ageing in place policies keep older people at home for longer with demand falling below the projections in the Aged Residential Care Services Review (Grant Thornton, 2010).

Sector occupancy has hovered around 87% over the past decade. Occupancy in CHT’s older facilities reflects this trend and has been lower than historic levels impacting on profitability. Strong occupancy growth has occurred in newly refurbished facilities. Total occupancy for the year was 93%.

Net operating surplus for the year of $8.7m compared unfavourably with the previous year’s surplus of $9.0m. Revenue growth was solid at 7% but profitability was constrained by increased labour costs.

The major development programme and the considerable investment being made in repairs and maintenance means CHT will have a very high standard of facility across the group, well configured for the challenging years that lie ahead.

The scale of this work programme could not have been achieved without a high performing Board and Management team and we thank them for their dedication and contribution this year.

We would like to acknowledge the ongoing commitment of our staff to the care of our residents. Every day of the year their caring provides a safe and friendly home for our residents.

Graeme Edmond Max Robins Chairman Chief Executive

6 | CHT Annual Report

Our peopleThe CHT workforce of over 720 people is truly diverse with a significant number of nursing and management staff originating from all around the world, contributing their wonderful skills and sharing their culture with our residents and families.

The composition of the workforce is ethnically diverse as well as relatively young at a median age of 38.1 years old, reflecting the shift in recent years from New Zealand born nurses to internationally qualified nurses.

41% of the total CHT workforce is Asian or Indian compared with 30% 5 years ago, with 29% of nurses Asian, 27% Indian and 25% European. 26% of Health Care Assistants are European, 23% Pacifica, 22% Indian and 16% Asian.

Altura - Staff Training

The introduction of Altura software has transformed the staff training programme and signals one of the biggest strides ahead in staff development in CHT history. From garden maintenance workers to nursing staff to Head Office staff, the Altura programme is capable of spanning the entire CHT workforce.

Offering over 100 modules, Altura provides an individual, online approach to learning with 13 orientation modules, dozens of specialist area modules and CHT-created modules. All modules are designed to provide a more visual, realistic learning with a touch of humour.

Module topics are varied and contain learning centred around themes such as Food Safety, Dignity and Personalised Care, Medication Management, Assessing and Managing Risk, and Cultural Diversity in Ageing.

Staff have shown real enthusiasm for Altura, with positive feedback and anticipation of the next modules demonstrating the success of the programme.

Employee satisfaction

Employee satisfaction continues to increase after the pay equity settlement, before which satisfaction with pay impacted negatively on overall satisfaction.

Unit Managers are able to accurately track staff engagement and module completion in real time, with reporting consolidated onto the existing Qliksense reporting platform to assist with compliance requirements.

EMPLOYEE SATISFACTION 84%

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Sharmila Deveraj - Area Manager, Quality and Privacy Manager

Currently studying for a Masters in Nursing, raising a young family and in a busy role as Area Manager, Sharmila originally wanted to become a doctor as a young woman in India, but ventured into nursing. Providing direct care is a passion of Sharmila’s and her experience in emergency care is another special skill.

Her first role as a registered nurse at CHT St Johns in 2010 was swiftly followed by a charge nurse role at CHT Royal Oak, then a promotion to Unit Manager where she introduced a number of award-winning quality care initiatives.

Now in her Area Manager role, Sharmila loves getting out and about to visit Units, teaching and inspiring others to always strive for delivery of the best care possible.

Janice Reuyan - ICT Trainer

A passionate life-long learner and natural teacher, Janice has a very important job that connects her to our nursing staff through all our regions, at different levels, as CHT ICT Trainer.

Growing up with her grandparents in the Philippines holds special memories for Janice, especially taking care of her grandfather when he was ill, which is one of the reasons that motivated Janice to train as a nurse. With a background in aged care nursing giving her a strong understanding of the everyday tasks of nurses, Janice helps bridge the gap between hands-on nursing and the IT software needed to correctly manage resident care.

In particular Janice loves the independence of her role and helping to problem-solve and upskill staff.

Marilyn Menezes - Unit Manager, CHT Onewa

Our youngest Unit Manager is seizing the day, as she masters her new role at CHT Onewa.

Growing up without grandparents of her own, Marilyn has a natural affection for older people and loves the chance to hear their stories and special memories, while also caring for their families.

The opportunity to put her hand up for new roles and challenges, and the support she received to reach her goals, is something Marilyn is very grateful to CHT for.

After training in Mumbai and spending many years as a nurse and Clinical Co-ordinator, Marilyn is passionate about making sure our residents feel connected to their community and receive the best possible care.

Marilyn says she feels privileged to care for people at the end of their life and enjoys making a good impression on residents and families.

Stella Ma - Unit Manager, CHT Hillcrest

Since joining CHT, Stella has made a positive impact with countless staff members, residents and family members.

Originally based at CHT St Christophers for 10 years in a number of roles - from grad nurse to charge nurse, Clinical Co-ordinator and Unit Manager - Stella has recently taken the helm at CHT Hillcrest as Unit Manager.

Throughout Stella’s career she has enjoyed the extra training and talent progression at CHT and now finds herself seeking out opportunities for her own staff.

As a youngster Stella spent a large amount of time with her grandmother, giving her a real affinity with older people, an appetite to always learn something new and find joy in helping others.

Meet some of our team membersWe’d like to introduce you to just a handful of our nurses, originating from all around the world, and contributing in many ways to our organisation.

8 | CHT Annual Report

Albert Principio - Clinical Co-ordinator, CHT Lansdowne

As Clinical Co-ordinator at CHT Lansdowne, Albert’s job keeps him busy and active - just how he likes to be!

After training at MIT seven years ago, Albert started out as a nurse in a rest home setting and found himself enjoying the chance to care for older people. Influencing others and having a wide impact through training is very rewarding for Albert, especially when he sees new nurses grow in confidence and capability.

In Albert’s view, the rewards of a career in nursing outweigh the challenges and it looks like helping others runs in his family - Albert’s brother is also a nurse.

Our nursing staff deserve to be commended for their passion, dedication and the great care they take of our

older people in CHT facilities.

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Focus on Care AwardsThe annual CHT Focus On Care Awards recognise individuals and facilities for their achievements throughout the year. In a special ceremony attended by the Board and Senior Management, winners were celebrated for their continual innovation and improvement, great leadership, specialist expertise, compassion, dedication and hard work.

Unit Focus on Care Merit Award - won by CHT Royal Oak for their Cognitive Stimulation Therapy (CST) programme. Implemented at CHT Royal Oak with a group of residents with mild to moderate dementia, it was noted that residents had improvements in mood, confidence and concentration.

Focus on Care Unit Award - CHT Hillcrest’s Falls Management programme provided an excellent example of how quality data can be used to inform an initiative that freed up staff time to care and used this time more effectively resulting in better outcomes for residents.

Unit Merit Award for Continuous Clinical Improvement CHT Hillcrest Unit Manager arranged for CHT staff to enrol on the DHB Ko Awatea training hub and identified eight on-line training sessions that would be most suitable for inexperienced nurses entering aged care. These modules were included in a broader training programme.

Unit Award for Continuous Clinical Improvement - A focus group at CHT Royal Oak was set up and a questionnaire developed to assess registered nurses’ current knowledge of wound care. Once the baseline level of understanding was determined an educational programme on effective wound care was introduced.

Focus on Care Unit Manager Award - this year’s winner, Sharmila Devaraj from CHT Royal Oak, is an excellent role model who not only achieved excellent results across all of the management KPI’s but also demonstrated a very strong commitment to continuous quality improvement.

CHT Registered Staff Merit Award - Therese Tating from CHT St Johns and Rajbans Kaur from CHT Hillcrest were both worthy of merit awards this year, showing a commitment to using data to inform a process of continuous improvement.

Anu Mathew from CHT St Margarets won the CHT Registered Staff Focus on Care Award thanks to her excellent case study on the care of a man who was admitted to the facility with Lewy Body Dementia. The resident had complex conditions and there were significant difficulties in managing his behaviour.

10 | CHT Annual Report

Our residents

Legnth of stay for residents admitted for long term care has remained very stable over time. Around 14% of residents have length of stay less than 21 days, a third have length of stay at less than 90 days, nearly half with stays less than 6 months, almost 60% less than a year and 73% less than 2 years.

Short term care increasing from 21% of ARC admissions in 2013 to 34% of ARC admissions in 2018.

21%

2013 2019

34%

SHORT TERM CARE

The proportion of female residents is 56% and male residents 44%.

RESIDENT GENDER

44%

14%less than

21 DAYS

34%less than

90 DAYS

47%less than 6 MTHS

59%less than 1 YEAR

73%less than

2 YEARS

Resident & Family experience feedback

Over 85% of residents and families are consistently satisfied and very satisfied with our care, reflecting our commitment to the highest possible quality care for all residents and continual communication with family members.

56%

SATISFACTION WITH CARE 87%

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Richard Park - CHT Onewa

Having spent most of his life in Ellerslie, Richard Park was initially skeptical about moving to CHT Onewa in Birkenhead after hip surgery, but he hasn’t looked back since. Being just around the corner from his daughter makes it very easy for her to pop in for a cup of tea in Richard’s comfortable room with bush views.

Richard’s strength and mobility has greatly improved and he counts the excellent nurses, homely surroundings and opportunities for both quiet time or social activities with other residents as positives about a move into CHT Onewa.

Meet a few of our residents

George Turner - CHT Peacehaven

Prior to admission at CHT Peacehaven in Blockhouse Bay, George was living with his wife Dorothy in a retirement village. When his health required a higher level of care, his GP highly recommended CHT Peacehaven and George has loved living here for more than two years. A feeling of safety, security and care was a priority for George’s family and there has been a significant improvement in his quality of life since entering CHT.

Dorothy visits George every day and both are very involved with other residents and staff, even enjoying weekly bus trips as part of the activities programme. This lovely couple also recently celebrated their 65th Wedding Anniversary with a party surrounded by family, friends, residents and staff.

Kerry King - CHT St Johns

Enjoying frequent visits from life-long friends and family members is a highlight for Kerry, who has been recovering from a stroke at Epsom’s CHT St Johns since early 2019. The welcoming atmosphere, sunny rooms, spacious shared areas and kind staff are all noted by Kerry as being the reason he can enjoy every day and he is very grateful for the dedicated care he receives.

Making great strides forward in his rehabilitation following his stroke, Kerry is feeling improvements in his wellbeing each week and is now confidently moving around on his new scooter.

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Activities ProgrammeThe Activities Programme at every CHT facility provides a wide range of activities, outings and entertainment suitable for residents of all abilities, managed by dedicated staff.

From simple yet important exercise sessions to indoor bowls, crafts, cultural performances, religious services, visits from groups and outings in the local area, the opportunity for residents to stay active in mind, body and spirit is an essential aspect of the care provided by CHT.

Volunteers from the communities surrounding our facilities also ensure that any special or unique activities enjoyed by residents are catered to, such as reading, chatting in their native tongue or taking a stroll.

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DevelopmentsCHT continues to embark on ambitious, innovative, future-focused developments across a number of properties, continually exploring ways to ensure that the everyday needs of our residents are met and the care homes are as comfortable and thoughtfully designed as possible.

Pioneering the ‘small house and community’ approach to construction in the New Zealand market, CHT has purposely built clusters of resident suites around shared lounge, kitchen and garden features for over 20 years; an approach that is now starting to be taken on by a number of residential aged care providers.

Two recent developments in particular showcase the new look and feel of CHT locations.

CHT Halldene - Red Beach

The quiet neighbourhood of Red Beach on the Whangaparaoa Peninsula is home to CHT Halldene. Located next to a public reserve with stunning views all the way across to Kawau Island, an extensive rebuild project is underway with the first stage delivering 32 brand new bedrooms, living areas and a further 28 bedrooms to be completed in October 2019.

New wings are named after local areas, accompanied by richly-captured photography of Whangaparoa Peninsula, designed as thoughtful reminders of the precious memories residents hold of this area.

CHT Carnarvon - Henderson

CHT Carnarvon Hospital is set within extensive lawns and established oak trees – a parklike setting. Constructed around a heritage building, CHT Carnarvon is conveniently located opposite Waitakere Hospital and has been an integral part of the Henderson community for many years.

In a nod to the history of the location, many legacy features such as the villa front of the original building and fireplace surrounds, will be preserved and incorporated into the new build.

The first 28 bedroom stage of CHT Carnarvon in Henderson was completed in March with the remaining 32 bedrooms being constructed in two stages and scheduled for completion in March of 2020.

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CHT Aged Care FundCHT’s dedication to continuous quality improvement and innovation, and its desire to support delivery of high quality care across the entire aged care sector, has inspired it to establish the CHT Aged Care Fund.

The purpose of the CHT Aged Care Fund is to enhance the wellbeing of older people by designating funds for the advancement of work among older people.

The CHT Aged Care Fund will provide a selected number of grants each year in the following areas, directly relating to the aged care sector:

• Research into the needs of older people

• Improved access to care

• Aged Care Workforce development

The Fund is looking for applications that demonstrate:

• Quality and social benefit of outcomes

• Demonstrable benefit to the aged care sector

• Capacity and capability to deliver

• Best Practice and sustainability of programmes

• Alignment with CHT’s Goals

The level of support each grant will provide will be based on the needs of the selected applications, which will require robust key performance indicators and reporting to ensure each grant is being used to maximum capacity and impact.

In its first year up to $200,000 will be designated for grants to be made to selected recipients whose applications are closely aligned to the purpose of the CHT Aged Care Fund.

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Key Performance IndicatorsOPERATING SURPLUS

$8.7M

90% 93.3% 90% 92.7%

102030405060708090100

FY16 FY17 FY18 FY19

OCCUPANCY

92.7%TOTAL ASSETS

$139M

99.4

126 127.4139.3

FY16 FY17 FY18 FY19

49.5

FY 16

52.5

FY 17

60.1

FY 18

64.5

FY 19

REVENUE

$64.5M

NUMBER OF BEDS

976913 924

997 976

FY16 FY17 FY18 FY19

NUMBER OF FACILITIES

16

14 14

16 16

FY16 FY17 FY18 FY19

9.2 8.9 9.0 8.7

FY16 FY17 FY18 FY19

16 | CHT Annual Report

Rate per 1,000 bed days

0

2

4

6

2012 2015 2019

Falls Infections

Clinical KPI trends

We are focused on continuous improvements in our care and clinical performance. To measure our progress, we monitor clinical events such as infections and medication errors. The rate of adverse events has been steadily falling.

The increase in 2015 occurred when CHT took over three facilities in the Bay of Plenty but after applying our systems and processes the rates on those sites fell in line with overall rates at CHT

Rate per 1,000 bed days

0

0.5

1

1.5

2012 2015 2019

Medication Error Complaints

CHT Lansdowne105 Botany RoadHowick 2010

09 535 4244

CHT Peacehaven55 Kinross StreetBlockhouse Bay 0600

09 627 8653

CHT Halldene35 Bay Vista DriveRed Beach 0932

09 426 3252

CHT Glynavon50 Boucher AveTe Puke 3119

07 573 6458

CHT Bernadette25 Taupo AveMt Maunganui 3116

07 575 4855

CHT Acacia Park134 Hamurana RoadOmokoroa 3114

07 548 0400

CHT Te Awamutu414 Swarbrick DriveTe Awamutu 3800

07 214 2010

CHT Carnarvon20 Lincoln RoadHenderson 0610

09 838 8348

CHT Head Office 97 Great South Rd Greenlane 1051 | Tel: 09 522 4585 | www.cht.co.nz

CHT St Johns54 Pah RoadEpsom 1023

09 625 6054

CHT Hillcrest86 Friesian DriveMangere 2022

09 275 8349

CHT St Christophers230 St George StPapatoetoe 2025

09 278 4637

CHT Onewa202-204 Onewa RoadBirkenhead 0626

09 481 0447

CHT St Margarets52 Beach RoadTe Atatu 0610

09 834 4963

CHT Royal Oak23A Mt Smart RoadRoyal Oak 1061

09 636 6211

CHT Waiuku14 Waimanawa LaneWaiuku 2123

09 235 6955

CHT Amberlea665 Mahurangi East RdAlgies Bay 0920

09 425 5017