Update 20 May 2025
There have been a lot of celebrations in the Netherlands these last few eeks. First, we had King’s Day, which is in celebration of the Dutch King’s birthday, but is also an unofficial national day. Then there was 4 May (Remembrance Day commemorating all Dutch civilians and members of the armed forces who have died in wars or peacekeeping missions since the outbreak of World War II) and 5 May to celebrate the 80th anniversary of the end of WWII. All the celebrations were helped by the excellent weather we had. In spite of the celebrations and nice weather there is still news to report. In this update we cover:
- Continued increase in number of users of social services. Will increasing the costs of the user change the trend?
- Critical article on substandard quality and inflated costs in commercial elderly care. How negative is this for the sector?
- Growing need for hospices. Is this an investment opportunity?
Continued increase in number of users of social services
Health and social care in the Netherlands are provided based on three laws. The Healthcare Insurance Law (ZVW) covers all cure related activities, while the Long-Term Care Law (WLZ) covers care for clients with structural healthcare issues (nursing homes, disabled care, etc.). Social care is structured via the Social Support Act (WMO). Social services covered by this act are financed by the municipalities and include services such as house cleaning, wheelchairs and other mobility aids, changes to homes to enable elderly people to stay at home (lifts, etc.), sheltered living, etc.
Spend on these services has been a growing part of municipality expenditures, and this can be explained by a rapid growth in the number of users. A recent analysis from the Dutch Central Bureau for Statistics (CBS) shows that in 2024 there were 1.26 million users of WMO-financed services, an increase of 11% from 2019. The largest group users of WMO-services are the elderly (75+). This group is becoming a larger share of the total population (8% in 2019 and 10% in 2024), but the share of this population using WMO-services has remained stable at approximately 33%. The surprising growth in users of WMO-services is among young adults for wheelchairs and use of taxis for transport, and young women making use of supported living services.
In 2019 the co-payments for WMO-services were maximized across all services used (currently approximately €21/month). This was believed to have caused a substantial increase in the use of WMO-financed housecleaning services as this was considerably cheaper than hiring a private cleaner. The current government has announced that it will make the co-payments dependent on income, making them higher for everyone earning more than 135% of minimum wage. The goal of this move is both to reduce demand and improve the financial situation of the municipalities. Unfortunately, based on the data from CBS it seems unlikely that this move will have any effect on the demand from the elderly for housekeeping services.
Critical article on inferior quality and excessive costs in commercial elderly care
Follow the Money (FTM) is a critical journalist collective that often writes well-researched and provocative articles about the Dutch healthcare sector. I do not always agree with their conclusions, but their articles are always worth reading and I have used their analysis as the starting point for earlier updates. One of their latest articles is highlighted as an exposure of the excessive costs and low quality of Dutch commercial nursing home care.
As is usually the case in this sort of article, the story starts with a specific case showing the mistreatment of a specific person. However, the article is also based on deep research on the profitability of 200 commercial companies providing elderly care in the Dutch market. The conclusion is, naturally, that “many” of these companies have (too) high profit margins, that the services provided are sub-par, that it is too easy to start a company providing complex elderly care, and that the regulatory bodies do not have sufficient control over the sector.
These conclusions are probably correct the “healthcare cowboys” currently providing elderly care in the Dutch market. However, it is interesting to see that the article positions Dagelijks Leven (with 104 locations and 4.000 employees the largest commercial nursing home chain in the Dutch market, and a significant part of Emeis’ Dutch operations) as a shining example of how payable / high quality elderly care should be provided. In addition, it is significant that none of the other big players in the market are mentioned in a negative way. Á careful conclusion can be made that serious commercial nursing home providers have found their place in the sector, but that they still have an image problem due to small, less serious providers.
Growing need for hospices
In 2024 12.000people in the Netherlands used a hospice as the last stop in their palliative care process. This is 11% more than the year before and a doubling in numbers from ten years earlier. The Dutch Association for Hospice Care expects a continued robust growth in demand due to the strong growth in the elderly population, but says that the current organizations providing this care are unable to meet demand.
We have written about Attenza, an commercial organization providing end-of-life care in the home setting. However, as far as I know, there are no commercial hospices in the Netherlands. Existing hospices are all managed and run by volunteers. This is certainly a service provided by commercial operators in other countries, and it is strange that this is not the case in the Netherlands. A commercial provider would also be better placed to invest in new facilities to meet the expected growth in demand.
Maybe an interesting investment opportunity for a company with relevant experience from other countries?