The Care Sector Postcode Lottery

Adam Hutchison

Having been operating in the care sector for many years now, the constant rhetoric around the lack of funding and fees for the provision of care that is not privately funded has always been noise which hovers around the sector.

Although it dawned on me in early 2019 that that noise has become just that - a hum in the background of all concerned which is seemingly being ignored. Following a conversation with various providers in recent events, it became apparent that this story has simply become the norm, the accepted state of play, and therefore ignored by the decision-making community.

The issue which is being missed here is actually, this information should be in the public domain. The tax-paying public knows little to nothing about why the sector has been frustrated with the lack of investment and almost feels it is the golden hand of greed crying out for more money. When actually, nothing could be further from the truth in what has become a complex argument soon to affect ourselves or certainly someone close to them in the future.

In this article:

The Postcode Lottery in the Care Sector

The context is that we now live in a postcode lottery when it comes to care, and the quality of the service provision available to people will soon be almost entirely determined by where and how you live, certainly in England. Currently, more than 75% of all new care home developments are happening in the South East of England? Why because that's where the money is apparently. This is based on house values and available income, not on care and whether you should receive it? Therefore what is occurring, as a nation, we are effectively saying that care is available at a certain standard only if you choose to invest in this yourself. This is all well and good like many luxury services, but really should care be seen in this way. Many figures are banded around about the weekly cost of care, and this seems to many people, to be astronomical figures. Most quoted privately funded care placements range from £1000 to £1600 per week with many living in care for upward of two years.

Understanding the Cost of Care

So let's do the maths this is at£1000 per week over £100,000 in that 2 year period, is this a lot? Some will say yes? But what the common issues surrounding care is the lack of understanding as to what that gets you. It almost certainly will include the following:

  • A 20 sq m plus bedroom with an ensuite wet room facility
  • 24/7 Personal care from a highly trained team of individuals
  • Food and full dining facilities
  • Wellbeing activities and transport to events
  • Exercise space
  • Laundry services
  • Visiting services
  • Healthcare interactions
  • Full record of this on a daily interaction basis
  • Fully insured and supported care
  • And much more

So this works out to £143 per day(not per night) so has anyone been on lately let's do a check. In2018 according to the BDO report the average UK cost per night for a hotel is£100.58 per night that is around £707 per week for a hotel room and some instances breakfast for 1 whole week. This means that all the other elements in the above list should only equate to £300 per week that is £43 per day for everything else. When you start to break this down that's not a bad deal is it?

Disparity in Care Home Fees

This article is not to justify care home weekly fees what it is to do is to highlight the vast disparity in the clarity around care home fees when you are then looking at funding when you are NOT in a position to self-fund your care but rely on the local authority in which you reside to fund that care. When you operate in this realm you will begin to see why there is such a demand for fees and funding to be increased to help support the care being delivered. So now let's look at this postcode lottery…

Postcode lottery

Kent County Council weekly fee from the Local Authority funded care placement £462 per week. Bexley Council weekly fee from the Local Authority funded care placement £560 per week(Information taken from the Care England - LA Fees Data set as at March 2023).

So let’s put a few things into context - London Borough of Bexley borders the County of Kent, therefore the difference of a town such as Dartford you could be part of 1 of the 2 areas and therefore that would make the difference of nearly £100 per week in terms of funding care purely based on where you live and have paid your council tax.This reiterates the thought process behind a postcode lottery, which has no fundamental degree of measurement as to why? But purely down to the legacy of that local authority area and its management of fees. This raises questions about the measurement and management of fees by local authorities and the impact on residents.

Variations in Local Authorities' Fees

On average it seems that in recent years 2016 onwards councils have taken a 2-3% increase on their fees to providers but yet some again further evidencing a postcode lottery have decided on much higher increases for example in 2018 - Bath & North SomersetCouncil increased its fees for Residential care by 15.5% for Dementia Care and22% for Residential care. Similarly Wilshire increased its fees for Residential care by 20.6% for Dementia Care and 16% for Residential care. So great news if you live in the South West - maybe we should think about moving? There are more of these but what this is clearly evidencing is that there is an awareness that increases are required so why is it only in certain areas this is being acknowledged? This is a question the public deserve to be answered.

Lack of Agreement on the Cost of Care

What this is saying is that there is no clear agreement to the cost of care. What it is saying is that the local authority do their best to source care as cheaply as possible regardless of outcomes or quality. Within the healthcare sector year on year data is produced by sector knowledge centres such as the UKHCA and LaingBuisson (these are just2 of a number) all of which focuses key data metrics from the sector to calculate the cost of delivering care. Yet not a single Local Authority currently uses any of this data but choose to ignore it in the belief that each county is different and therefore its people are different. This is completely incorrect because care should be considered the same for all people regardless of their location and the willingness of the local authority to fund the care appropriately. This is evidenced by the successful Scottish Care model which effectively has a blanket LA fee across the whole country.

Care Homes Fees Falling Short of Real Costs

The 2018 Laingbuisson update to its Care Cost Benchmarks toolkit has found that the average fee per resident paid to care homes typically falls short of the real costs of service provision by more than £100a week – a situation which means that those residents who pay from their own finances are filling a funding gap of £1 billion a year in financial 2017/18.

Taken from Laingbuisson reports for March 2018

Local Authorities Ignoring Cost Increases and Quality Provision

What the data further substantiates is the ignorance by the local authorities to do anything about these drives in costs and to support quality provision in care. Much is written about this disparity and lack of foresight to the sector, but little is ever done. The focus should be on the public to see through the issues of cost and focus on the clarity of the situation.

Funding Gap for Privately Funded Care

Based on the fees quoted previously you will see this nearly half the fees demanded for privately funded care breaking down to a mere £79 per day and in some areas such as Kent as little as £68 per day for the Local Authority contribution. And then there is wonder as to the rising number of Care homes struggling to deliver and the number of people unable to find a placement for care. Because how can the true care be delivered at these low benchmarks, it simply doesn't stack up.

Increasing Complexity of Elderly Care Needs

What also needs to be considered is that over the last 5years not only have costs and deliverables of care raised massively but there is a stark change in the support required for someone entering residential care. With the drive towards keeping people in their own homes for longer with support packages, by the time people are entering the Residential care model certainly for the Elderly care sector the needs are far more complex meaning they require much higher levels of care, none of this is taken into account with local authority fees but simply ignored.

Insufficient Funding for Care Sector

At some point care is going to be needed by someone we know therefore there needs to be an awareness as to the undertakings which ultimately impact the delivery of that said care. How is it possible to deliver on a service which year on year has a declining level of funding compared to the increase in costs. Would a school be expected to operate on less than required or a hospital or in fact a private construction company who are building a new purpose built unit for a local authority? I cannot imagine there would be many contractors vying for contracts that were year on year reducing in the overall cost to deliver the service itself. And many of these increases are actually government lead initiatives - National Living Wage, Auto Enrolment pensions and apprenticeship levies all impacting to the increase costs yet no support by the overall funding for which the sector needs.

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