Federal Aged Care Minister Anika Wells has criticised Wesley Mission for not telling her about its plans to close its remaining three Sydney homes during a meeting two weeks ago.
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Wesley chief executive Stu Cameron blamed the "difficult decision" on workforce pressures imposed by the Albanese government's industry reforms, which will require providers to staff facilities with nurses 24/7.
The imminent closures of the aged care homes in Sylvania in the city's south, Carlingford in the northwest and Narrabeen on the northern beaches will affect almost 200 residents.
The Christian community organisation shut its aged care facility at Dundas in northwest Sydney last year.
The federal government has committed to having registered nurses in aged care homes around the clock from July, after a recommendation by the aged care royal commission.
The sector is also experiencing chronic staff shortages and the minimum pay rate will increase by 15 per cent from July.
"Wesley Mission supports these once-in-a-generation reforms, improving quality for all care users," Reverend Cameron said on Thursday.
"But we took the extraordinarily difficult decision - it was time for us to exit the sector.
"There are all sorts of pressures - workforce pressures, cost pressures."
Ms Wells said the reforms were necessary to increase the standard of care for residents and called on providers to work with the government while they waited for a funding boost to work its way through the system.
"Discount the scare campaigns that are out there," she told reporters on Thursday.
"I'm not strapping on my GoPro and my Blundstones and kicking down the doors to facilities on 1 July.
"I appreciate the scale of what we are asking people to do but I refuse to apologise for being ambitious for aged care."
The minister said Wesley Mission had been aware of the royal commission's recommendations for more than two years but raised no issues with her when she met with Rev Cameron two weeks ago.
"Had they raised that with me, I could have told them about all the resourcing, information and support that is available to facilities who are facing crippling workforce shortages and who are worried that they will not meet requirements," Ms Wells said.
Julio Villagran, whose mother has end-stage dementia and is a resident at one of the homes, said the facility had provided great care.
"The staff there know how to react to her, her eye contact, her non-verbal cues," he told Nine News.
"If she goes to another place, it's going to be very difficult for her. It's going to be very difficult for everyone."
The sector's peak body said the closures were "regrettable but understandable in the current reform climate".
Seven in every 10 providers were operating at a loss, losing an average of $28 per resident per day, the Aged and Community Care Providers Association said.
"That is simply not sustainable," a spokeswoman said.
"The aged-care sector is facing enormous financial challenges and workforce shortages at the same time that it is racing to implement the once-in-a-generation reforms."
Rev Cameron said Wesley's aged care offering was small compared with the diverse range of community services it provided across NSW.
The not-for-profit shifted its aged care focus to in-home care and retirement living to help people stay in their homes for longer.
"It is ... a challenging environment to be a smaller provider," Rev Cameron said.
Wesley is committed to relocating all 199 residents before the three centres close at the end of May.
Under government regulations, residents are not required to move until sufficient accommodation has been found.
Some 249 staff will be moved into new roles within the organisation or with other providers.
Australian Associated Press
