About UKHCA
The United Kingdom Homecare Association is the professional association of homecare providers from the independent, voluntary, not-for-profit and statutory sectors.
The association represents over 1,800 organisations across the United Kingdom - about a third of all homecare providers in the UK.
It was formed in 1989 and started in the first Chief Executive’s living room.
In the two decades since UKHCA was founded, we have seen homecare change rapidly. In many parts of the UK, the vast majority of state-organised homecare is now provided by the independent and voluntary sector.
However, the independent homecare sector is still made up made up of many small providers. There are some large providers but most are still small to medium organisations, though this may be changing.
UKHCA provides a range of services for its members. These include:
· Training workshops on areas such as medication, dementia, recruitment and retention of staff, how to survive and thrive in business, employment law, and health and safety at work.
· Publication and resources, such as our bi-monthly magazine Homecarer which contains information for homecare organisations and managers, training material, research reports, factsheets and policy guidance documents.
· Regular e-mail alerts and mailings on breaking news affecting the sector.
· Access to training funds from the European Union and the UK Government.
· Free advice and support. Our telephone helpline includes free legal and human resources advice.
· Criminal Records Bureau checks – the association is a registered body enabling member organisations to undertake criminal record checks.
· Professional representation – UKHCA represents the views of homecare providers to policy makers, regulators and the media.
Before looking at the implications of Personalisation for the independent homecare sector, I want to say a little bit about the challenges facing the homecare sector.
These fall under three categories: low pay, training and commissioning.
Low pay
The homecare sector is a low pay sector. The average rate of pay for a homecare worker in England is just £6.80 an hour.
This headline, however, figure masks considerable regional differences.
For example, the average rate of pay in the North East of England is only £5.85 an hour.
Can we therefore be surprised that the rate of staff turnover in the homecare sector is 18%?[1]
A major reason for low pay in the independent sector is that local authorities act a near monopsony (a single buyer) for the purchase of homecare in their local area.
Because of this they can exert a downward pressure on independent providers’ prices, impeding their ability to pay wages sufficient to ensure adequate recruitment and retention of staff.
The Low Pay Commission has recommended on four separate occasions that the Government ensures that the commissioning policies of local authorities and the NHS reflect the actual costs of social care, including the National Minimum Wage.[2]
This year, the Government has accepted the recommendation.[3] However, we have yet to hear of any firm proposals from the Department of Health on how this will be taken forward.
The result is a workforce which is typically pay sensitive, characterised by an undesirable “churn” as workers change employers for relatively small increases.
This is costly in terms of the recruitment and induction costs for care staff, but also fails to provide the continuity of care which is so valued by service users.
It also prejudices the completion of qualifications such as NVQs, thereby reducing the effectiveness of training funding.
Training
Increasingly homecare staff are being asked to undertake complex tasks and medication related activities that were previously the domain of District Nurses.
Added to this, the Department of Health now wants a well trained and skilled homecare workforce to take a lead role in the delivery of the National Dementia Strategy.
Regrettably, there’s little appetite among local authorities for rewarding providers who supply qualified careworkers. Care workers on NVQ Level 4 or above only get an extra 5% more than those at entry level.[4]
This further limits providers’ ability to reward their staff with an enhanced wage rate.
Meanwhile, local authorities have proved themselves an unreliable distributor of national training grants. In 2006-2007, the majority of the National Training Grant – 63% - was spent on local authority staff and there was a £26 million under-spend.[5]
Since April 2008 such grants are not ring-fenced and may be used for other local priorities than social care, so there is even less of a guarantee that national money will be used for training the social care workforce.
Ultimately the flux in the workforce is costly in terms of the recruitment and induction costs for social care staff but also fails to provide the continuity of care which is so valued by service users.
It also prejudices the completion of qualifications, reducing the effectiveness of training funding.
The cost of the required training package for a new careworker is likely to be around £980.[6] Averaging these investment costs and turnover across the social care sector, the annual loss to the sector is £78 million.
Commissioning
Pressure to cut costs
Homecare providers are coming under increasing pressure from local authority commissioners exercised by efficiency savings and reducing costs of services.
This pressure is likely to grow as local authorities attempt to pass on reductions in social care funding because of the current economic downturn.
Local authorities’ annual contract price reviews already barely recognise homecare providers’ additional statutory costs.
In 2007, UKHCA’s survey of local authorities indicated that 38% would not be implementing any contract increase, despite new statutory holiday entitlement from October 2007 alone estimated to add 2% to the wage bill.[7]
Only paying for contact time
Other “cost saving” mechanisms used by local authority commissioners include only paying for contact time – sometimes only by the minute - or using short care episodes of 15 minutes for personal care.
This will inevitably impact on the wellbeing and job satisfaction of the workforce, and satisfaction with care received. These cost saving approaches limit the ability of the workforce to adopt a more proactive and enabling role.
It also limits providers’ ability to pass on higher wage costs for careworkers undergoing training, or travelling between clients, as they are only able to derive fees for billing for services provided.
If the price paid by local authorities genuinely does not take into account the cost of homecare provision, and providers are forced to not pay staff for training or to ask them to pay for their own Criminal Records Bureau disclosure checks, they are then pilloried for being complicit in bad practice or in it “for the money”.
E-tendering
Another emerging cost saving pattern is local authorities using E-tendering processes, where care contracts are won by the lowest bidder.
E-auctions are a particular problem for small and medium enterprise homecare providers who may feel that their survival is based entirely on the public sector purchaser and that they are effectively forced into winning the contract at any price, however low.
This then impacts on pay levels and exacerbates recruitment and retention difficulties.
Personalisation
Risks and threats
Turning to Personalisation, let me first say that UKHCA was a signatory to Putting People First and we support the delivery of more personalised services.
However, it is important to recognise there are significant risks and threats for home care providers from the Government’s plans for transforming social care.
Until now have been little acknowledged but could potentially have important unintended consequences for the sector. At its most extreme, it “could spell large-scale destruction of the sector.”[8]
Organisations that have been largely dependent on local authority purchasing may, within a relatively short period of time, lose contracts across the board, leading to a rapid reduction in guaranteed volume and therefore income.
The previous regulator, the Commission for Social Care Inspection (succeeded by the Care Quality Commission in April 2009) estimated in 2006 that 78% of independent sector homecare providers’ business is from local authorities.[9] For many, this loss of income could lead to closure.
Contracts, of course, are not going to disappear overnight. The length of existing contracts may well determine the speed at which a local authority can move towards SDS.
Medium-sized and large organisations are thought to be more at risk than small providers, who tend to be less dependent on high-volume local authority contracts and more in tune with the private market.
Still, it is generally agreed that there will continue to be a need for properly organised services with trained, vetted workers.
Loss of workforce capacity
A critical question is the impact that personalisation will have on the ability of the homecare sector to meet demand. If local care at home agencies close, there is no guarantee that the care workers will find other jobs within social care.
They may move out of social care altogether, thereby reducing overall capacity.
A move away from high-volume contracting arrangements by councils may make staff retention in some organisations more difficult. Public sector contracts make it possible for providers to make sure that front-line staff have at least some work.
With the possibility of these guarantees going or being reduced, there is likely to be more instability in the labour market and an increase in the churn of workers between employers.
Loss of staff to direct payment users
Another consequence of personalisation is that formal domiciliary care providers may lose staff to direct payment users.
There is much anecdotal evidence that this is already happening. Providers say that the direct payment rates received by service users who have previously been their clients are usually not enough to enable them to continue to purchase their agency’s service.
A UK wide survey of direct payments found the average hourly direct payment rate to an older person in England was just £8.70.[10]
This limits the ability of service users to buy care from an independent provider unless they can afford to “top up” their care, ironic given the principle of direct payments is to extend service user choice.
A two-tier workforce
It seems entirely illogical to UKHCA that government should have brought about a highly regulated sector in 2002, while at the same time, promoting a cash payment system for the engagement of untrained, unqualified, unsupported and unregulated personal assistants
Practice may diverge from policy
Finally, it is important to recognise that the practice of councils may diverge from government policy when it comes to implementing personalisation.
We have heard from a number of our members in England of local authority commissioning departments attempting to impose contract conditions on independent and voluntary sector providers as a response to greater personalisation.
Our member organisations report that when contracts come up for renewal, councils are reducing the number of providers successful in obtaining or retaining business to a very small number - sometimes moving from trading with 30 to trading with fewer than 10 - often, we believe, on the basis of the least expensive tender.
Opportunities
Despite the potential risks from personalisation, there are also exciting opportunities for providers, although these will require major changes to existing services.
Last year, UKHCA published a personalisation toolkit to provide independent homecare providers with information and advice on the UK Government’s personalisation agenda.[11]
It made a number of suggestions on how providers can best meet the challenges of personalisation by developing new services and protecting their business.
Theses include:
Consider setting up a specialised service
· For people with dementia, children with learning difficulties and challenging behaviour, palliative care.
· Providing different aspects of healthcare.
Or offering:
· Help with domestic tasks.
· Handyman service.
· Gardening service.
· Help with pets.
· Companionship service - interviewing, screening and matching.
· Social and recreational activities service.
· Facilitating, or brokering, service for service users with individual budgets.
· Back-up service to people who normally employ a personal assistant.
· Training for personal assistants.
· Recruiting agency for personal assistants, including vetting.
· Pay-roll service for those employing personal assistants.
However, these will require major changes to existing services
And, importantly providers will have to take a financial risk without knowing what the demand for the service will be.
7
[1] National Minimum Dataset online research page, Workforce: Worker Summary – National, Regional (Sheet 9). http://www.nmds-sc-online.org.uk/research/researchdocs.aspx?id=9
[2] National Minimum Wage Low Pay Commission report 2009 (2009). p.74. http://www.lowpay.gov.uk/lowpay/report/pdf/7997-BERR-Low%20Pay%20Commission-WEB.pdf
[3] Press release 12 May 2009. Government Approves New £5.80 Minimum Wage Rate. Department for Business Enterprise and Regulatory Reform. http://nds.coi.gov.uk/environment/fullDetail.asp?ReleaseID=401122&NewsAreaID=2&NavigatedFromDepartment=True
[4] Skills for Care. NMDS-SC Briefing, Issue 3 – Pay. (2007). P.2 https://www.nmds-sc-online.org.uk/Get.aspx?id=285946
[5] Skills for Care, The State of the Adult Social Care Workforce (2008). P.11 www.topssengland.net/view.asp?id=977
[6] Skills for Care. NMDS-SC Briefing, Issue 2 – Turnover and Vacancy Rates. (2007). P.1 www.nmds-sc-online.org.uk
[7] A fair price for homecare, UKHCA media release (2007). www.ukhca.co.uk/mediastatement_information.aspx?releaseID=22
[8] L. Sawyer (2008) The personalisation agenda: Threats and opportunities for domiciliary care providers, in Journal of Care Services Management, Vol. 3, No.1,pp 41-63, Henry Stewart Publications.
http://www.ukhca.co.uk/members/pdfs/personalisationagendaLS.pdf.
[9] Time to Care? Commission for Social Care Inspection (2006), p28. No longer available to download from CQC website.
[10] Direct Payments Survey: A national survey of direct payments policy and practice, Personal Social Services Research Unit. (2007). P.57 www.pssru.ac.uk/pdf/dprla.pdf
[11] http://www.ukhca.co.uk/members/pdfs/PersonalisationToolkit.pdf A copy is available on request.