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By Debbie le Quesne

Archive for January 2016

We need to get the message ‘out there’

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Before anyone gets too excited at the potential headline-grabbing white paper that is doing the rounds in the care sector, it is not of the government variety.

I just need to make it clear, that this piece of work – Stabilising the Care Home Sector and Preparing for implementation of Part 2 of the Care Act 2020 – is a document produced by healthcare experts LainBuisson and is not the esteemed wisdom (I jest) of government research.

It says so much that the industry’s prime player in delivering analysis is now desperately trying to spark discussion with finding that are, for me anyway, terrifying.

I applaud this piece of work, but I note the language is pretty emotive and it’s not in the usual tone for L&G documentation. At best there’s an air of urgency about the work, and worst . . . a sense of panic.

It’s heavy going in parts and long, but in the main accessible. It should be essential reading for every self-respecting MP and elected representative, but I know it won’t be.

It’s our collective responsibility to get this message ‘out there’. In L&G’s own words, the objective is to stimulate debate on two linked topics:

  • What is needed to stabilise those segments of the care home sector which mainly serve older people in receipt of state funding and which are moving into crisis at a variable pace in different parts of the country?
  • How should the Dilnot funding reforms be modified to avoid the pitfalls that became evident in the run up to postponement of Part 2 of the Care Act (if the government carries out its stated intention to implement the Dilnot reforms in 2020)?
  • A third topic can also be added: What new initiatives could be started now to improve the functioning of the care market, within existing legislation and without the need top-down structural reform, on the part of different stakeholders – central government, local authorities, the NHS, regulators and consumers and their advocates?

 

There used to be a saying locally – “there’s none s’ blind as those who don’t want to see.”

So to put you in the picture, West Midlands Care Association is desperately trying to ensure we are doing everything to make certain the eyes (and ears) of local and national politicians are indeed open.

To this end I’m meeting minister for social care Alistair Burt tomorrow to discuss the viability of the care sector given the current stance of Government.

I’ll let you know how is goes.

 

 

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It could soon be a providers’ market (but don’t bank on it)

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During next five years a shift in the dynamics of the care market could favour providers, according to an interesting appendix buried at the end latest white paper by industry analysts LaingBuisson.

The economic forecast (an excerpt from Care of Older People Market Report – 27th edition, published in September 2015) goes like this: “The care home market is subject to a self-righting mechanism like any other market. Investment is curtailed when prices (as now) are insufficient to offer a reasonable return in areas of high public pay. As a result, against a background of rising demand, shortages can be expected to appear.

“Market power will shift towards providers, prices will rise and public authorities will be forced to find extra resources if they are to meet statutory duties.”

The timescale? Likely over the next five years, the analysts say.

As you’d expect with any economic prediction there’s a get out jail clause or two, and here they are: “Market imperfections (including non-transparency of market information together with development time lags) will predispose the market to overshooting equilibrium in both the contraction phase (which the care home market appears to have entered now) and any past or future expansion phase.

“There is also historical evidence of such cyclical patterns in the care home sector in the last two decades . . .”

And there’s more:

The Conservative administration may feel the crisis justifies a pre-emptive injection of substantial new funding – the National Living Wage (£7.20 from April 2016, rising to £9.00 by 2020) would certainly be a driver.

Without an at least partly compensating increase in government grants to allow councils to raise the care home fees they pay, the government can expect – here we go – a “wave of financial failures in the care sector.”

And finally in this post, L&B come up with a stunning nugget of information which may be the real reason for the postponement of the Dilnot elements in the Care Act. At a stroke, the delay (2020 is now the target date) some £2 billion can expect to be saved over the next four years.

Money saved, yes, but at a cost. Those residents who live in the less affluent parts of the West Midlands will certainly not be able to take up the slack, so it stands to reason that those residential and domiciliary businesses will be the first to go.

And the next in line will be those providers who have indeed followed the rules and regulations to the letter and discover too late the cost of doing so does not make for a viable business model. You know, I still can’t help thinking how callous and shortsighted such decisions are. Are we not ultimately penalising the most frail and vulnerable and those who care for them?

 

 

LaingBuisson: Plan for the future amidst the gloom

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It is, say some, a bit of a mouthful in a single bite, but Stabilising the Care Home Sector and Preparing for implementation of Part 2 of the Care Act 2020, is a document that should be essential reading for every self-respecting MP and councillor in the UK.

The report, produced by Healthcare expert LaingBuisson tables some bleak forecasts under its ‘Imminent care home capacity crisis’ banner, but despite the emotive language, it is a serious authoritative report.

Market analysis experts L&G are not know for scaremongering or pandering with their PR to the ‘red tops’. But here on the first page of this new white paper we read: “There is a real and imminent danger of a care home bed capacity crisis hitting many localities in the course of the next few years, as the margins of operators serving state-paid residents continue to be squeezed, as investment in new capacity ceases and as existing capacity exits the market, against a background of rising demographic pressure of demand.”

A “real and imminent danger” . . . emotive? Yes, and perhaps a little out of character with L&G. Overplayed? No! Definitely no.

The conclusion for how, as they put it, ‘equilibrium will be restored’ is also a scary read. The Chancellor’s two per cent council tax plan gets well-deserved dismissive treatment and the long-term future solution lands fair and square in the lap of central Government, according to the report.

This is what they say: “Our realistic conclusion is that the 2% Council Tax ‘precept’ flexibility to supplement social care funding, announced in the 2015 Comprehensive Spending Review, will not throw a financial lifeline to the care home sector. It may pay for initial National Living Wage cost increases, but councils will want to spend most of the additional funding on meeting demand pressures (service volumes) and downward pressure on unit prices and margins will in all probability continue, reinforcing provider disinvestment.

Indeed, Sandwell and Dudley have both announced that they will take up the option to increase the Council Tax.

“At some stage, ordinary market forces can be expected to resolve any care capacity crisis, but only when it is full blown. At that stage, falling capacity will make it increasingly difficult for councils to make placements locally at their usual prices. With rising occupancy rates, market power will shift to providers and a point will be reached where central government has no other realistic option but to provide councils with the means to re-incentivise sufficient investment in care home capacity to enable councils to fulfil their statutory duties.

“The resolution may be complete by 2020, by which time the cost to the state of paying for long term care for people without the means of their own will probably be substantially higher than it is today.”

The paper goes on to warn that if its conclusions are correct, that the care home sector’s equilibrium will ultimately be restored by market forces rather than pre-emptive financial support from central government, the next few years “are likely to witness a spate of financial failures and home closures.”

With words that drip like honey to the converted, the reports adds: “The development of a ‘stand-off’ between central and local government in which central government argues that it has made adequate financial provision and that it is up to each council to make best use of its (adequate) resources, while councils for their part argue (probably correctly) that the funding is not adequate and therefore they cannot pay providers reasonable prices, and in turn providers cannot afford to pay carers a living wage. In effect, no part of government is taking full responsibility for good market management of the care home sector.”

L&G says there is weakness in the present system of state funding care which has nurtured the growth of polarised economics.

Quote: “It is this absence of good market management (including failure to fund social care adequately) which has allowed the care home sector to evolve into its present highly polarised state, with inadequate profits in areas highly exposed to public pay and super-profits earned by some providers in areas of high private

pay. It is also the root cause of endemic cross subsidisation, with private payers now paying an average 40% plus premium over public payers for like for like.”

If Mr Cameron is not concerned by this forecast he should be and just in case he hasn’t a clue what to do, L&G offers a proposal for government action.

Reforms would include the creation of a national economic regulator for the care homes sector. Its role would include:

 

  • Setting a target rate of return for care home property used for council placements.
  • It would be based based on CQC physical environment standards, establishing a process for determining local capital cost benchmarks per room, taking into account local land prices (and local construction/ maintenance costs if necessary).
  • CQC would be one obvious candidate for this extended economic regulation function since (a) it is already responsible for light touch financial regulation of larger providers and (b) CQC physical environment standards (such as minimum room size) are key determinants of benchmark capital costs per room.

 

  • Another would be Monitor, the economic regulator for the NHS.

 

  • Further options included in the proposal to head of the terminal descent of the industry include;
    Transfer responsibility and funding for paying care home property costs from Councils with Adult Social Service Responsibility (CASSRs) to Housing Benefit. The effect of this would be to rationalise funding for all care modalities, placing care homes on the same basis as extra care for older people and supported living for younger adults with learning disabilities and other needs.
  • Set up a process for classifying each care home with a council contract with an appropriate physical environment grade, linked to a complementary set of locally based care home Housing Benefit bands.

 

 

I cannot begin to image the outcomes of such plans, but at least L&G has one with a rationale I can understand.

 

 

As regional care providers face such a gloomy forecast, they appear to fall three distinct categories:

  1. Those looking to close or make changes to their business plans
  2. Those who are keeping fingers crossed for a better tomorrow, but do nothing
  3. And those who will will increase their costs which must be paid by residents or their families

The problem, however, with areas like Sandwell and Walsall, and indeed other West Midlands regions, few people in care or receiving care have disposable funds to pay more. Sorry, I have no inspired answers, but, believe me, the fight for a fair rate for the care delivered goes on at both regional and national level.

 

There is so, so much more to this paper and I intent to attempt a number of blogs on the ‘hotspot’ subjects. Perhaps in the meantime, the movers and shakers, the policy makers and generally those privileged people who can initiate change and influence events, could make it bedtime reading and enjoy their nightmares.

 

Birmingham Care Awards – get the nominations in NOW

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Here’s a date for the diary: Birmingham Care Awards, June 2, Edgbaston Cricket Ground and it’s all about a celebration of care.

Too many negatives haunt the industry and it’s a timely opportunity to lock up the nasty phantoms of 2015 and remember just how excellently most care plans are delivered.

As a nation we excel in care. By 2022, according to the Institute of Public Policy Research, we will need an army of 2.75 million extra carers, nurses, healthcare assistants, doctors and social workers to service a growing demand.

Care is big business now and for the future and we need desperately to promote just how brilliant individuals, teams and partnerships can perform in this developing workplace.

Awards will recognise the following categories: Children, Home Care, Residential, Nursing, Learning Disability, Mental Health, Dementia and Specialist Care.

They will be presented in a £40-a-ticket gala spectacular and the initiative has the backing of Birmingham City Council. All good!

As you can imagine I’ve jumped at the chance to get on board with this. So how does it work?

  • Complete a form http://www.westmidlandscare.co.uk/members-area/ and email it to the Association. We will then send a reply and an acknowledgment number
  • Talk about what’s happening or happened
  • Provide support testimonials
  • Remember, someone else must nominate you
  • All awards cover all areas of service in the Birmingham area

 

Now here’s the hard bit. Application must be in by February 12, so get a move on . . . please.

This is a showcase opportunity to give good care a public airing. Let’s do it and make it an event to be proud of.

Awards will be made for: Excellence in Care, Excellence in Support Servies, Excellence in Supporting Citizens Award, Meaningful Activities Award, Excellence in Leadership and Management, Commitment too Workforce Development, Exceptional Newcomer, Exceptional Dignity in Care, Success in Parnership, and Lifetime Achievement (Over 25 years).

Come on, let’s get those nominations in and give the panel of judges a really hard time.

Osborne’s chaos: A local view

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Spent too much time yesterday thinking about my Osborne blogs and what really needed to be posted is the local angle.

A two per cent council tax increase . . . what planet does he think we are on? It would pinch everyone a little – yes, but will it make any difference at all? No. Emphatically, no.

I understand that Dudley is considering raising the level of council tax, while Sandwell will probably not. Whatever the decision in these two key West Midland boroughs, the great financial divide between the real and notional costs of care will not be plugged.

We have turned into the New Year and the Government still appears rudderless when it comes to the care sector. Local authorities, Mr Cameron, do not have sufficient monies to pay proper rates for the services the private sector provide. What is so hard to understand? Tinkering with council tax is like dressing a critical wound lightly when invasive surgery is prescribed.

So many of my members are relatively small players and their market resilience is just about gone. These people are not the fat-cat operators many perceive. The bigger operators are also struggling as the fees don’t cover their costs either. Caught in a financial and moral dilemma, they are struggling to survive on economics that don’t stack up, while still trying to care for an ever-growing pool of needy people.

Self-help is a common and much over used term. Well, let me say the industry has been self-helping now for a good decade. Ironically, many local authorities once perceived as the enemies of delivering a fare rate to care providers, now genuinely see the need to pay it. But they can’t, Mr Cameron – because central Government administer the real money and it’s not being decanted downwards.

How are these essential social care businesses to survive? They have used their reserves a long time ago, most have no properties to sell off, and oh yes, a new raft of outgoings – the living wage – faces them in April.

An impact survey by the association suggests any benefits found with reductions in Corporation tax – a fall to 19 per cent in 2017 and 18 per cent in 2002 – will not plug an ever-widening chasm between realistic operational costs and fees paid for care by local authorities.

Under the Chancellor’s plans, workers aged over 25 will get a minimum of £7.20 an hour from April, rising to £9 by 2020.

The Government says this will mean a direct pay rise for 2.5 million workers of an average of £5,000 by 2020.

It’s a great concept and I applaud the sentiments of this initiative. But there needs to be some Goverment financial lubrication in the care market to make it happen without the inevitability of home closures.

The cost to my members? Let me remind you: It will add £23 per week to the care of every Midlands person in a residential care setting.

It will also mean there will be little or no pay differential between domestic staff will little responsibility and experienced Diploma Level 2 carers.

For those businesses offering community care, my association concludes there will be an additional £1.50 per hour cost for each member of staff. This figure does not include the additional expenses of travel time, which is not funded in the local authority rate.

There simply isn’t anywhere amongst us for extra savings to be made. Years of austerity have taken their toll and the creative thinking is through.

Our calculations regarding the timing of and potential savings on Corporation tax just don’t work as an offset to this extra expenditure, over which members have no control.

WMCA is pressing Government for a speedy response. Along with other national representative bodies we are doing all we can. I really do believe its now the time for Mr Cameron to intervene and, likewise, do all he can.

Good old Beeb wading in to help with the message

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In a response to the Osborne funding solution to a gaping hole in social care funding, some of the industry’s top brass have waded in with their response.

Along with representations made by the West Midlands Care Association in the lead to Christmas, a letter –signed by the Association of Directors of Adult Social Services, the Care Provider Alliance, and the NHS Confederation – has formed the basis of a BBC piece.

It points out that the amount of money council tax brings in varies greatly, with local authorities in poorer areas worse off.

The Beeb noted George Osborne said his plans would lead to an above-inflation rise in care budgets.

But council chiefs, NHS managers and care bosses have cast doubt on those claims in a letter to the chancellor.

It warned his plans “would leave a funding gap and put vulnerable people at risk.”

Of course, this is denied by the government.

In the none-too-helpful Spending Review, Mr Osborne said he was protecting social care budgets by allowing local authorities to raise council tax by 2 per cent and increasing the amount of money available for the Better Care Fund, a joint pot of money used by councils and the NHS to support care services.

Hmmm . . . He also said that with other changes, it would mean care budgets would rise, adding the NHS could not “function effectively without good social care”.

Good old BBC reported: “But now those involved in providing care services are questioning those claims.”

I can’t think of a single person in the care sector who is not questioning the claims.

No extra money (£1.5bn) from the Better Care Fund – it will not kick in until 2019 and according to the Local Government Association two of its main funding streams, the income it gets from the central government grant and business rates, down 24 per cent in real terms this Parliament term.

Together these account for about a third of council funding.

Again the warning is bleak. Ray James, president of the Association of Directors of Adult Social Services, is reported as saying the result will see councils struggle to maintain care spending at its current level, never mind increase it.

Critically, James added: “We have an ageing population which is increasing demand and have to cope with the introduction of National Living Wage. Without action, we will see care homes close and vulnerable people not getting care.”

A spokesman for the Department for Communities and Local Government said councils had enough for care services, according to the report.

What?

For months all I appear to be reading are warnings of closure and the perils of failing care because the cash is just not there. God forbid that it will take another national chain to go bust before the purse strings are released.

Do these government spokespeople really believe there is sufficient in the pot? Like Dickens’ character Oliver with his meager rations of gruel, the industry dare cries for more. I recall they wanted to hang young Oliver. I recall the other day, in a response to the Autumn Statement, one care provider saying “We’re being hung . . . out to dry.” Nothing much changed from the days of Dickens then (I jest, of course).

 

King’s Fund warning on the rich-poor care divide

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George Osborne’s decision to sanction a two per cent rise in council tax to offset cuts to social care will lead to thousands more older people missing out on vital services, the Guardian newspaper has revealed.

For many the bible of social care, the newspaper said the chancellor’s spending review attempt to plug the hole in care funds, will only widen the gap in provision between richer and poorer areas and “raise at most only £800m a year – far less than the £2bn he predicted.”

The King’s Fund is a non-political body that harnesses the thinking of some of the finest minds in the UK. It needs to be heard.

In a detailed critique of the policy, the thinktank has found “that disadvantaged places in the north, Midlands and inner London with the greatest need for social care will lose out because they will be able to raise too little extra revenue from it to make any difference.” How true! We had said for years the Midlands has some of the most impoverished boroughs in the country and they are deserving of a ‘special case’ approach.

Quote from Richard Humphries, the King’s Fund’s assistant director of policy, who has undertaken the analysis: “Relying on councils to plug the gap in social care funding won’t be equitable or effective because of the inverse social care law that councils that have the greatest need for publicly funded social care are least able to meet it [because their council tax bases are so low]. George Osborne’s new policy is of very limited help for them,”

Do I hear an amen?

Humphries adds the precept is a “shortsighted” response to the growing crisis in social care,

And delivering more criticism, Humphries says the plan is ”very opaque, complicated and messy option, which, crucially, will not much help areas at greatest need. It’s a very high-risk strategy.”

Humphries then warns social care providers collapsing, more people going without the care they need or having to pay for it themselves, and even more pressure on families and the NHS to pick up the pieces when there’s a breakdown support.

Quote: “Older people will be more likely to end up in hospital.”

At the risk of overloading this blog, let me quote some more of the Guardian piece: “The thinktank believes that the 2% precept is based on ‘completely implausible assumptions made by the Treasury’. For example, the expected £2bn figure is based on all of England’s 152 councils levying it, but many councils are highly reluctant to raise council tax at all and quite a few were elected after specifically promising no rises. Only half of councils increased their rates this year.”

Humphries found that the two councils that would receive the least extra income from the levy would be Wandsworth, at £3.70-a-head, and Westminster at £4.90. But neither is typical because council tax rates in the two Conservative-run London boroughs are already so unusually low.

If you require more information look up the following link http://www.theguardian.com/society/2015/nov/20/osborne-plans-to-allow-2-council-tax-rises-to-plug-social-care-holes

It’s harrowing stuff, but we know that news, by its definition, is rarely good.

In a letter to the Guardian, the King’s Fund chief executive, Prof Chris Ham, and Nigel Edwards, his counterpart at the Nuffield Trust thinktank, say the spending review “represents another setback for people who need social care. [The] new powers to raise council tax will provide local authorities with some financial flexibility but … will disadvantage deprived areas with high needs for publicly funded care.”

Joining the chorus of criticism, along with our selves (WMCA) are charities such as Age UK and Alzheimer’s Society and bodies such as the Local Government Association and Care and Support Alliance.

It’s another example of central government dodging the bullet and putting the responsibility on already struggling local councils to raise more money for social care. Clearly, it should be the role of government to provide it to the growing number of people in need due to the UK’s ageing population.

I don’t doubt there are some politicians who do recognise the huge chorus of complaint, but additional money is still not with us.

The Better Care Fund won’t come into effect until 2017!

As the social care sector we still remain the Cinderella of caring with no frontloading of cash, unlike the NHS.

Okay . . . where’s cream cakes, biscuits? How I need something to ease the pain of reality! Returning to work after a break is that never easy.