Biggest not-profit provider pulls out of home care market

The UK’s largest not-for-profit care provider is to pull out of the home care market because it feels local authority fees make it unaffordable to provide high-quality care.

Housing & Care 21, which operates in over 150 local authority areas, is to sell on its home care business to another provider.

Chief executive Bruce Moore told BBC Radio 4’s You and Yours programme today: “The local authority market for home care is really under pressure at the moment and that’s why we are taking that very difficult decision.

“The pressures are that local authorities have been squeezed in their social care budgets for a number of years and as a result they are having to pay the lowest rates possible and that means effectively we can’t provide the staff training, the recruitment, the terms and conditions to get really good quality care workers, which older people require.

“Recruiting and retaining staff, when we are paying close to the minimum wage, and often having to adopt zero hours contracts, isn’t the best way to get good quality care workers and that compromises quality.”

Compromise on standards

Moore said he was confident that another provider would take on the business and that there would be no discontinuity of care for staff. However, he said providers wanting to take on the business may “have less exacting standards” for the care they delivered.

Moore’s announcement is the latest example of the impact of providers exiting the market in response to successive years of real-terms cuts to local authority fees. In the first half of this year, home care providers handed back contracts in 59 council areas in England, while in 48 areas at least one home care provider ceased trading, found the Association of Directors of Adult Social Services’ (ADASS) annual budget survey.

In July, provider Mears announced it had pulled out of home care contracts in Liverpool and Wirral over rates it described as “extremely irresponsible and possibly illegal”, a charge denied by both councils.

‘Increasingly pressured’

Moore said: “It is coming increasingly pressured, and some companies are staying, and perhaps by staying and increasing their volumes (other companies) will become more efficient.

“But I think a lot of people won’t be re-tendering for contracts and will move out gradually. We are a very big provider so we took the view the easiest way to move out of this area is to find another provider who can take this on and hopefully maintain the quality standards.

Moore said Housing & Care 21 aspired to be rated as at least good by the Care Quality Commission, both overall and in relation to the regulator’s performance categories, of being safe, effective, caring, responsive and well-led.

He said that another provider may be less ambitious over standards and, as a result, may be more able to manage contracts on current local authority fees.

‘Incredibly difficult’

ADASS vice-president Margaret Wilcox said the impact of providers failing or exiting the market on vulnerable people “should not be underestimated”.

She added: “Councils are doing everything they can to minimise the effect of any provider failures on residents, but the complexities of many contracts and care packages makes this incredibly difficult. We have produced several guides to help councils, and directors have been working within regions to support each other.

“We’re now at a tipping point where social care is in jeopardy, and unless the government addresses the chronic underfunding of the sector, there will be worrying consequences for the NHS and, most importantly, older and disabled people, their families and carers.”