Council fee proposals ‘risk care home closures’

Care homes and nursing homes in Essex will close if the council pushes through a set of proposed placement fees that are “not adequate” to sustain services, sector leaders have claimed.

A cost of care exercise by the local authority found a fair cost of care would be £647 per week for residential placements and £665 per week for nursing.

However, in a letter seen by Community Care council bosses admitted applying these rates to all providers would be “unaffordable”. It instead suggested a fee uplift system that would see current rates increase by a maximum of £13.79 per week, even if this left providers short of the fees recommended by the costing exercise.

Care England, which represents care homes and nursing homes across England, hit out at the move and said it would leave some providers facing funding gaps of up to 30% this year.

Martin Green, the organisation’s chief executive, said: “There seems to be little point conducting a costs of care exercise without adhering to the results. Our members have a good working relationship with Essex council and want to work with them to ensure that residents are in a position to receive the best quality care.

“It is however unsustainable for a council to conclude what it costs to fund care then pay less than this cost, and expect the independent sector to fund the difference.”

‘Vulnerable get nothing’

Under the proposals, providers will receive a fee uplift of £13.58 for residential care if their current weekly rate is below £647. A proportion of the £13.58 will be paid for service user placements up to £647.

For example, if a home currently receives a weekly fee of £640.99, the increase will be £6.01.

The same process applies to nursing homes, but with a fee uplift of £13.79.

Care England said the “vast majority” of providers will get the full uplift, which is the first inflationary increase in nine years. However, because the current rates paid to contracted providers range from £456 to £538, this means they will still receive less than £647 or £665.

The organisation estimates that this will leave a funding gap of 30% for residential care providers and 23% for nursing, and providers will be expected to find the difference.

Less than 5% of providers will receive “anywhere near” the new rates, Care England added.

For providers already receiving rates above £647/£665, which tend to support the most vulnerable people with very complex support needs, there will be no fee increase.

‘Cease to exist’

Green added: “Without adequate resourcing care homes will simply cease to exist. They cannot afford to run at a loss. Essex council needs to ensure that if funds the cost of care otherwise there will be closures leading to unnecessary stress on many of the county’s most vulnerable people and their families.”

Malcolm Maddocks, Essex council’s deputy cabinet member of aged care, said: “The Care Act 2014 places a duty on local authorities to ‘promote the efficient and effective operation of a market in services for meeting care and support needs’.

“However, the statutory guidance allows for local authorities to consider their budgetary position, and most comply with its related public law duties. This includes ensuring funding is sufficient to meet the needs of the entire local population.

“This council recognises the cost pressures faced by social care providers, and has increased rates for both residential and nursing placements, which reflects the increase cost of the national living age. This is the right thing to do, while we continue to work with our provider partners in developing a sustainable market in the context of limited local authority budgets.”