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The negativity surrounding the care home operator Southern Cross which recently reported half-yearly losses of £311m makes me wonder if there are lessons to be learned from this for dentistry?

There are very specific circumstances that have led to the crisis at Southern Cross, which owns 751 care homes around Britain. Unlike most operators in this sector it doesn't own its properties, and has been locked into expensive rental agreements - which it is now having to renegotiate. Southern Cross also has a higher proportion of residents that are funded by local authorities (around 80 per cent). Part of Southern Cross's difficulties has arisen from the fact that the care fees it receives aren't sufficient to cover the rent, while other care costs and care fees paid by local authorities don't keep pace with expenses.

Charities claim that cuts to council budgets are making this problem even worse. Age UK estimates that local authorities are underpaying care providers by nearly £500m a year. Age UK – together with Bupa and the Local Government Association – has written to the Prime Minister warning that 'pressure on public finances is pushing an already overburdened system to breaking point'. According to Age UK it has also created the highly unjust situation where a private-paying patient will often pay more per week than a council-funded one for the same level of care – as some nursing home operators are forced to use their private patients to subsidise the shortfall in council funding.