Average local authority fee increases for independent older
people's care homes for will exceed inflation this year,
Laing and Buisson said today.
In a report, the market experts said UK care homes have received
an average fee increase from councils of 2.6% for 2009-10 but
calculated that prices would increase on average by between 2% and
2.5% this year, as a result of the economic downturn.
Laing and Buisson also predicted that homes would increase
charges for privately-funded residents by more than the increase
they received from councils.
Senior analyst Alex Mitchell said: "This means that efficient
operators should on average be able to hold and even improve their
margins slightly in 2009-10."
'Recession dividend'
Mitchell said that care homes were benefiting from a "recession
dividend" that had placed downward pressures on prices. For
instance, the national minimum wage, a major cost factor for care
providers, is due to rise by only 1.2% this October, from £5.73 to
£5.80 an hour.
However, Mitchell warned that this must be set against the
"chronic shortfalls" in council fees for care homes which he
claimed had existed "more or less since councils took over
responsibility for paying for care homes in 1993".
Wide regional variations
And the figures for this year showed wide variations between
nations and regions, with Welsh care homes receiving a 4.6% uplift,
Scottish providers 3%, Northern Irish homes 2.9% and English
providers just 2.2%. Within England, care homes in East Anglia and
Greater London received sub-inflationary increases of 1.4% and 1.6%
respectively, compared with 2.8% for the North East and North
West.
The survey, which is published in the June edition of Laing and
Buisson's
Community Care Market News,
also found increasing evidence that councils were increasingly
using quality criteria to pay higher fees to better providers and
lower rates to poorer performers.
Almost half of councils were using quality criteria, compared
with about a quarter last year. Many English councils were using
the
Care Quality Commission's quality ratings
scheme, which rates providers from zero (poor) to three
(excellent) stars, though others were using in-house quality
frameworks.
Provider concerns over quality-based fees
Laing and Buisson said this would increase concerns among care
providers that the stringency of some quality criteria may lead to
a significant number of care homes receiving low fee increases.
Related articles
Providers urged to back campaign to raise
council care fees
Recession: Care home market is resilient, expert
says
Laing and Buisson: Provider fears over councils
linking fees to quality