There has been a growing awareness that the stability of the state-funded homecare market has been undermined by significant underfunding and poor procurement practices. The 2018 ADASS Budget Survey rightly acknowledges the presence of market failure in some parts of the country and fragility elsewhere. The report suggests that directors of adult social services also believe that they have a role in increasing the wages of care workers, ranking it as the most important factor in solving recruitment and retention pressures .
While I hear directors of adult social services repeatedly stating that the stability of the homecare market is their greatest anxiety, we are not seeing much evidence it is being addressed at a local level through practical action. Although there are a few isolated examples of councils making some serious attempts to improve fees paid to providers, the majority have just about managed to maintain the status quo.
Forgive a focus on financial matters but the greatest risks to the stability of the provider market (and the terms and conditions of the workforce) are financial, borne out by a recent survey of over 500 providers, who stated that inadequate fee levels, below-inflation increases and low direct payments rates are at the top of the list .
There appears to be a significant change in providers’ willingness to undertake state-funded homecare. It is not just providers handing-back contracts or unsustainable packages, but adopting a far more cautious approach to contracts being offered for tender.
Providers’ risk assessments of new contracts increasingly suggest there are ambitious specifications but little understanding of the associated costs. Some contracts have also contained clauses which are now deal-breakers, including: requiring a single price for 3-5 years; councils reserving a unilateral right to vary contract terms after award; and vague references to the council changing its purchasing intentions during the life of the contract. Many of these contracts effectively require providers to sign-up to a contract which could change into something very different from what is described in the draft.
While we’ve seen an increase in the number of tender processes abandoned before awards are made (with associated costs for both the tax-payer and provider), a number of directors of adult social services tell me they have had no shortage of prospective tenderers. If this is the case, we have to hope they have managed to secure not just a sufficient number of bids, but providers who can deliver the required volume at the right quality for the life of the contract. Our message to providers is that they should not sign up to unsustainable contracts where they would have to compromise on quality or safety.
Many providers themselves are taking a hard look at which customers they are willing to supply to. There is a perceptible shift towards providers who intend solely or mainly supplying to people who fund their own care.
UKHCA has used freedom of information legislation to establish whether councils have undertaken a cost of care exercise with their local providers. UKHCA’s Minimum Price for Homecare  provides a template and councils are directed to take notice of our methodology in Statutory Guidance . Whilst the majority of councils claimed to have done some form of cost of care exercise, most were unable to provide evidence of their calculations. Avoiding such a calculation may be a way of conveniently hiding from stark realities. Unless I’m wrong, many authorities seem prepared to play Russian roulette with the stability of their care market.
We certainly haven’t been able to find any part of the system which is effectively policing the market-shaping responsibilities councils have under the Care Act 2014. The Department of Health and Social Care and the bodies representing commissioners have each told us they do not do it.
However, effective independent oversight of how councils discharge their duties is urgently needed. Logically, this would be the Care Quality Commission in England. It already assesses the quality of care delivered by providers, but is not empowered to assess commissioning practices of councils without specific permission by Government.
Government has suggested that such a national oversight regime could be included as part of the forthcoming Green Paper consultation  and the Local Government Association has already indicated its opposition . It is hard to see why such scrutiny would not be in the public interest. It could certainly play a role in improving the fragility of the state-funded sector in the short term, before whatever solution to longer-term funding is agreed and effective.