Last Updated on October 24, 2026

The Care Quality Commission (CQC) has published its latest annual State of Care report, revealing a social care market in flux. Meanwhile, CQC reports persistent inequalities across the whole health and care system mean people's experience of care is fractured and heavily dependent on where they live and who they are.

According to CQC, demand for health and adult social care continues to grow, and in many areas, including community mental health services, need is also becoming more complex. There are signs of improvement, including more GP appointments, increased use of digital solutions, and shorter waits for elective care. The report highlights examples of local innovation, including neighbourhood models and integrated teams.

However, CQC's report states that improvement is struggling to keep pace with rising demand. The report finds unwarranted variation in access to services, the quality of care and outcomes for people across every part of the system CQC regulates.

On adult social care, the report details a rapidly changing market. According to CQC, underpinning much of this change is the varying ability of local authorities to plan for the care their communities need in line with a clear strategy, alongside a funding model that remains fragile. This is leaving care providers and local authorities exposed to pressures that are reshaping the market by accident rather than design.

In addition, homecare is fragmenting, with a growing number of small providers entering the market, while care homes are consolidating, with more of the available care home beds now located in large care homes and recent increases in institutional investors acquiring homes. These divergent trends – consolidation of care home ownership by institutional investors, and fragmentation of community-based provision – look likely to continue based on the report's findings. CQC has committed itself to monitoring quality carefully to ensure this does not have an impact on either personalisation of, or access to, care.

Commissioning is one of the most powerful levers to drive quality, equity and sustainability in social care, as CQC's local authority assessments have highlighted. In Wigan, CQC's assessment rated the council as 'outstanding', as it worked collaboratively with providers and people who use services to shape the local market and tackle health inequalities. By developing more local provision, it reduced reliance on care placements outside the borough. Its reablement service, rated outstanding and delivered jointly with health partners, means fewer people need ongoing support a year after leaving.

But, within this changing market, CQC finds some local authorities are struggling to meet people's needs, and providers are increasingly seeking people who can self-fund their care in order to remain viable. This comes despite some improvements in social care staffing, with vacancy and turnover rates falling slightly, although concerns remain about reduced international recruitment. Almost three-quarters of the sector is rated as 'good' or outstanding, but CQC has identified leadership as the area most in need of improvement. Inspections show clearly that well-led services deliver safer, more person-centred care.

Commenting on the latest findings, Chris Badger, Chief Inspector of Adult Social Care and Integrated Care at CQC, said, 'A clearer vision is needed. In addition to the sustainable funding solution CQC has consistently called for, commissioning needs to improve so the market can be shaped around what's best for people, and in a way that ensures care staff can be employed fairly.

'Our assessments of local authorities have found that done well, commissioning can help build more resilient care markets where more people are helped to stay out of hospital and get care closer to home. Investment in leadership capability is also needed – well-led services deliver safer, better care.

'Ten years ago, we warned that adult social care was approaching a tipping point. Successive governments have not resolved the issue of long-term funding for the sector. Now, this Government's renewed focus on social care offers an important opportunity for meaningful solutions in social care that improve outcomes across the whole health and care landscape – but only if reforms address workforce, funding, commissioning, prevention and inequalities together.

'None of this can be considered in isolation. Pressures in one part of the system compound others and are exposing fractures right across health and care, from mental health support to maternity and primary care, and in widening inequalities for children and young people. Success can't be measured by how well each part of the system performs on its own – it's how well those parts work together for the people who need them, regardless of who they are or where they live.'

Baroness Julia Neuberger, CQC's Chair, said, 'Challenges in social care provision are contributing to delays in hospital discharge. Gaps in community mental health provision are pushing more people towards crisis care. To repair a fracturing system, there must be a collective response. Providers, regulators, commissioners and Government all have a role to play in improving care, and we'll be judged not by what we achieve alone, but by what we achieve together.

'We're committed to playing our part – encouraging innovation and improvement and accelerating the progress we've made as an organisation. We'll be drilling down into the areas that give us cause for concern, drawing on what we hear from people who use health and care services, as well as from their families and carers, and what we see through our regulatory work.

Hannah Morgan, Senior Director, Product and Innovation at Quality Compliance Systems (QCS), said, 'There is much to be positive about in this year's State of Care report, but the findings around Safe and Well-Led show where the sector needs continued focus.

'Care providers are already navigating significant pressures and change. What they need now is clarity, consistency and practical support that makes continuous improvement easier, while allowing teams to focus on what matters most: delivering safe, high-quality care and positive outcomes for the people they support.

'As sector reform continues, QCS believes that clear communication and consistency from the CQC and Government will be vital. The opportunity now is to turn the findings of the report into meaningful improvement, supporting strong leadership and giving providers the confidence to keep raising standards across social care.'

Phil Holmes, President of the Association of Directors of Adult Social Services (ADASS), said, 'This report shows how hard councils and care providers work to maintain high standards, with the majority being rated as good or better. Adult social care is frequently presented as being in crisis but the CQC have underlined the good work that takes place day in day out driven by a workforce that the Prime Minister himself characterised as possessing both skill and humanity.

'The report also sets out what happens when good standards are not reached and the actions that need to be taken to address this. Alongside this the CQC have described the context in which adult social care takes place, with councils overspending and, in spite of this, decreasing numbers of people receiving support. The impression given is of adult social care trying to run forwards as fast as current resources allow, but nevertheless continuing to be pushed backwards in the face of ever-increasing demands.

'Adult social care has a vital role in helping people maintain their health and wellbeing so they can live productive, fulfilling lives that enriches their families, their communities and their local economies. This is why national reform has never been more important. The sustainable improvement that our population and our workforce deserve will require both structural change and sustained investment in the staffing, services and local systems that make high-quality care possible.'

To read State of Care 2025/26, click here.

In other news, a new report from the Homecare Association has found that the state-funded homecare funding gap has widened to £2.3bn.