The ‘wicked issues’ government must deal with to prevent care funding reform chaos

Filter coffee and bacon butties were on offer last Friday for those who rose early enough to make an 8am session on care funding reform at the National Children and Adult Services Conference.

The largesse came courtesy of the Department of Health but if the senior adults’ services managers and lead councillors present were grateful, that didn’t stop them giving DH officials a tough time over the many questions that remain unanswered about the reforms.

At the start of the session, DH director general for social care Jon Rouse said he wanted to address the “wicked issues” that surrounded the plans – and delegates certainly didn’t disappoint.

The changes – under the Care Bill – would, from April 2016, place a £72,000 cap on the ‘reasonable’ costs older people would have to spend on their care before receiving full state funding for meeting these costs; and extend the asset threshold below which homeowners would receive some state help with residential care costs from £23,250 to £118,000. In addition, from April 2015, all councils would be obliged to provide a deferred payments scheme under which some homeowners’ could have their residential care costs met up-front and then recouped on the sale of their house.

‘Wicked issues’ with care funding cap

Most of the ‘wicked issues’ related to the way the cap would work. To qualify, self-funders would have to be assessed by their authority as having eligible needs that are not met by a carer. The council would then provide them with a virtual ‘independent personal budget’, setting out what the council would spend on meeting their needs if it were obliged to meet them. Then, self-funders would have to have their needs regularly reviewed and the sum of annual independent personal budgets would accumulate in a ‘care account’ until the cap was reached.

The changes would require councils to carry out 500,000 additional assessments of people with eligible needs in 2016-17 – and many others for people who are not eligible. Among questions asked by NCAS delegates were:-

• What kind of assessments will councils need to do on this new population, should people be able to assess their own needs and, if so, how should this work?
• What number and type of additional staff would councils need to meet the increased demand? Department of Health official Sebastian Habibi said that, even if it were affordable, there would not be enough qualified social workers to take on this responsibility.
• Will the assessment and care account process not create a massive new bureaucracy that may prove unnecessary for the many people who never reach the cap?

Self-funder subsidy

For pure self-funders – those who qualify for no means-tested support for their care costs – the level of their independent personal budget would be far less than the fee they paid for their care. This is because of the practice of care providers charging self-funders more than council-funded clients for the same service, as authorities use their buying power to force down rates.

Delegates seemed particularly concerned about the fallout of this, asking questions such as:-

• Will people feel conned as the full costs of their care will not count towards the cap?
• Will providers be forced out of business as self-funders demand that they pay no more than their independent personal budget rate for care?
• Or will councils have to increase the amount they pay for funded clients to ensure the market for care remains viable? And if so will the DH meet these additional costs?
• Is the Department of Health engaging sufficiently with providers on the implications of the reforms for them? One delegate said providers in their area were not informed at all about the reforms.

There were many other issues across a range of topics:

• One delegate also warned that the reforms risked creating a “tax on carers” on the grounds that people who have all their needs met by their family will have an independent personal budget of zero. Those whose family are not involved in supporting them will be more likely to qualify for the cap.
• While the £72,000 cap would apply to people who acquire care needs after the age of 65, lower caps would apply to those who acquire needs earlier in life, with a cap of zero – free care – for those who acquire needs before they turn 25. This caused some disquiet among a few delegates, who warned this could result in a mounting bill for councils from the growing number of people with lifelong needs. One delegate questioned whether the policy would allow someone to claim free care later in life on the basis of a short-term episode of care they received before they turned 25, even if they did not have lifelong needs.
• What would happen if someone  who would otherwise be a self-funder received a free service from their council, such as reablement? Would the council’s spend on this service count towards the cap, meaning they would effectively be paying for the service twice? DH social care policy director Sean Gallagher said this should not happen so he would look at the proposals again to ensure that it could not.
• In relation to deferred payments, will the government underwrite the risks to councils of loans not being repaid? Local government is not a bank, said one delegate.

Too much reform all at once?

Besides these individual issues relating to the funding reforms, a wider point was made; that these reforms will be implemented in 2015 and 2016, while councils were also implementing the rest of the changes in the Care Bill and the £3.8bn pooled budget with clinical commissioning groups designed to further integration with health. Was this not too big an agenda for councils to be dealing with at a time of shrinking budgets?

I think the DH officials found the session very useful. But it did leave me with some level of foreboding about what will happen over the next three years and whether local government may end up taking on more than it can chew. Let us hope not.