In October 2016, Care England issued judicial review proceedings against Essex County Council challenging its decision setting the fee rates it would pay to independent care home providers during the year 2016/17.
The decision affected around 60 per cent of the 4,500 residential care placements made by the council within Essex’s care home market.
Before making its decision, the council undertook a detailed analysis of what it costs care homes in Essex to meet the needs of the individuals within their homes. The results of this analysis – which the council accepted – were that it costs £647.15 per person per week in the case of residential care and £665.35 per person per week in the case of nursing care.
Armed with this knowledge and an acceptance of its failure to increase prices since 2009 – seven years - the council still proceeded with a decision to pay care homes significantly less than what it costs them to provide their services. The prices the council decided to pay were on average £163.57 per person per week below the cost of care in the case residential care, and £108.56 per person per week in the case of nursing care.
Local authorities have a statutory obligation to ensure that there is sufficient quality care home provision in their areas. The sustainability of this market is therefore a key factor which local authorities have to have regard to when setting the prices they will pay for the placements they commission.
Professor Martin Green OBE, chief executive of Care England says: “It is therefore particularly disappointing that the judge hearing this case formed the view that the councillor who made the decision had carried out a sufficient enough enquiry into the sustainability of the Essex care home market; when that enquiry was based not on the information that had been presented to him by Council officers, but on his own knowledge and assumptions.
Despite the court’s ruling, Care England remains particularly concerned that the Council’s decision jeopardises the sustainability of the care home market in Essex”.
National intelligence paints a bleak picture of an increasingly ageing population seeking assistance with their care needs within a heavily overburdened and financially stretched health and social care service. The CMA said only this week that “CMA’s financial analysis of the sector has identified a funding shortfall of £1 billion a year across the UK because councils are paying fee rates for the residents they fund which are below the costs care homes incur.”
Professor Martin Green OBE, continues: “It is therefore deeply worrying that Essex Council is underfunding the care that it is required by law to provide and pay for. The council’s evidence that care homes can simply terminate the placements made by the council if they believe the council is not paying enough, pays cavalier regard to the risks this poses to those individuals involved and the distress this would cause to them and their relatives. It seems however that the only option being presented to care homes in Essex is to exit the market.”
At present, there seems to be a divide between the judiciary in their thinking and approaches to deciding cases where local authorities are challenged on how they decide the rates they will pay for residential social care for older people. Care England will of course reflect on the court’s decision and how it may further support our members and the much needed structure and clarity that is required in this area.
