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27th June 2013

Commissioning practices within the Homecare Sector

This past week, the national press and media have been highlighting poor practices in Homecare with, in particular, CCTV footage evidencing a poor standard of care being provided to a vulnerable adult.

And rightly so.

However, I thought it would be important to raise a few concerns regarding commissioning practices and underfunding within the Homecare sector which impacts on the quality of service provided, and highlight the issues that are impacting on the financial viability of Homecare providers.

The majority of Homecare agencies are committed to working with Commissioners to ensure best value and to develop new methods of working.  Providers are aware of the financial climate within which Commissioners are currently operating, but equally we need to ensure that commissioners are aware of the pressures and issues that are faced by Homecare providers.

The pressure on providers has never been greater. There is an ongoing demand to achieve cost efficiencies whilst meeting tighter timescales for the acceptance of new work and provision of management data. The following issues are impacting directly on the financial viability of Homecare providers....

  • Homecare is a labour intensive service with approx 92% of costs related to staff wages. In the main, Homecare providers are paying above the National Minimum wage (NMW)  – but the differential  between the NMW and  pay rates has been eroded in recent years as fee rates have been held and then reduced (2011) whilst the NMW  has steadily increased  each year.  A further 1.93% increase to the NMW is being applied in October this year.

Some Local Authorities have lowered their fee levels, and in my case, the fee my Company is paid now is less than the rate paid in 2009. In that time the National Minimum Wage has increased by 26p (2.4% of the fee rate) with a further increase of 12p in October 2013.

  • The current fee rates paid by Local Authorities combined with the erosion of differentials with the NMW, makes it difficult for providers to compete against other sectors in the labour market. Recruitment is an ongoing process for all providers with a high percentage of fallout during the recruitment process.
  • The tender process is time consuming for both commissioners and providers. Some Local Authorities are only issuing contracts which last three years. Serious consideration should be given to contract lengths so that providers have a longer, guaranteed contract time with secured funding. Homecare Providers can invest with more confidence if they have a longer contract period.  Many responsible providers will  reinvest in their business to improve  effectiveness and  efficiency  – for example enhanced  management  systems which enable carers work schedules to be sent securely to their mobile phones, thus improving the efficiency of the day to day working.
  • Current commissioning arrangements do not take any account of the pressure/ demands created by the referral process. The situation is exacerbated because the majority of Homecare staff are on variable hour contracts. The local authority I work with expects contracted Homecare agencies to pick up all new referrals in our area. The timescale for the pickup of referrals is short - with a response required within as little as 24 hours.  For high priority service users, the service must start 24 hours later. With the pressure so high to adhere to these timescales, the continuity of carers requested to attend that service user in the first few days is not always good, with different carer workers allocated until a team of regular carers are contacted and added to the rota system. These timescales impact on the quality of care provided in these first initial days when, for some clients, it is their first introduction to a Homecare service.
  • The current commissioning arrangements for care means that the majority of carers employed in the independent sector are employed on variable hour contracts – that is workers are only paid for the calls allocated to them. Providers are unable to guarantee all care workers hours because the commissioning structure only pays providers for hours contracted. The providers ability to deliver the contract is affected because the care worker is not obliged to work and there must be some degree of negotiation. The commissioning process that currently applies means that providers cannot guarantee all staff a set number of hours.  For example, Mr Y receives 4 calls a day  x  1 hour  x 7 days  a week=28 hours a week. Mr Y then goes into Residential care and the package is terminated. The carers covering the call lose those hours – as does the provider. The carer’s income is affected until replacement calls or new referrals are allocated to them. Providers cannot guarantee carers wages when care is being purchased on a “spot” basis. Due to the nature of the work and the frequent changes providers find that allocating  “Guaranteed hours”  to staff only works on staff who are car drivers as they have the flexibility to move across areas. However, this is more costly for some providers as they pay mileage expenses.
  • In order to recruit and retain competent staff, providers need to be able to reward staff financially for further training achieved. The current contract fees can restrict providers from doing this. Staff we invest in may leave once training is completed for higher rates of pay in the NHS.
  • Commissioners should also consider that between 2012 and 2017, care workers will have to be enrolled into a qualifying pension plan under the New Pensions arrangements. The minimum employer contribution is 1% of qualifying earnings. Maximum total contribution is 2% of qualifying earnings and the contribution increases from Oct 2017 (2%) and in 2018 (3%).
    • My colleagues and I are currently deciding whether to tender for a new contract within in our locality; however on closer inspection of the contract specification, the fee rate for a waking night call has been set at £60 for a ten hour shift. This fee rate does not even cover NMW the successful bidder will be expected to contribute towards the difference. We are giving serious consideration to whether we can realistically bid for this new contract if it is not financially viable. The price on our tender bid equates to 60% score of the evaluation of the bid. Anything over the set fee rate will be given a zero rating score for price.

If 60% of the emphasis is given to price then what emphasis is given to the quality of the service delivered?

According to the Community Care statistics 2011-12, during 2011-12 there was an estimated total of 517,000 adults receiving care at home through their local authority.

Homecare providers employ a ‘silent army’ of workers who are out in all weathers, 24 hours per day, 365 days of the year, caring for the most vulnerable within our communities. We should continue to recognise and celebrate our staff for their hard work in supporting hundreds of thousands of people to live well at home every day, promoting the value and quality of homecare.

We must highlight to commissioners the range of issues that are impacting on Homecare providers; Our shared objective between commissioners and providers is to ensure that Homecare providers are able to continue to deliver a viable quality service to our service users which ensures that they remain safe and secure in their own home.

Community Care Statistics 2011-12: Social Services Activity Report, England. Table 3.1, page 33.

Rosie Robinson - QCS Expert Contributor in Domiciliary Care


Business Support Manager

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