Decision details

Each year local authorities consider and/or set the rates paid to its Adult Social Care provider market and determine the uplifts, if any, that will be applied for the following financial year to take account of inflationary pressures.

In 2022/23 the Department for Health and Social Care (DHSC) has required local authorities to complete a Cost of Care exercise for 65+ residential and nursing homes and for Domiciliary Care (otherwise known as Home Care) for people 18+ to better understand the sustainability of fee rates. This exercise has been completed and the draft outcome was submitted to the DHSC by the deadline of 14 October 2022, although further work is needed to better understand the outcome concluded for care homes.

Approval was sought to the three-year financial plan for the adult social care provider market  to ensure market sustainability.

Reasons for recommendations

Each year local authorities consider and/or set the rates paid to its Adult Social Care provider market and determine the uplifts, if any, that will be applied for the following financial year to take account of inflationary pressures.

In 2022/23 the Department for Health and Social Care (DHSC) has required local authorities to complete a Cost of Care exercise for 65+ residential and nursing homes and for Domiciliary Care (otherwise known as Home Care) for people 18+ to better understand the sustainability of fee rates. This exercise had been completed and the draft outcome was submitted to the DHSC by the deadline of 14 October 2022, although further work was needed to better understand the outcome concluded for care homes.

Alternative options considered

The Council can hold fees at current rates, however the social care sector across all markets was significantly challenged, with issues that include escalating costs that were unsustainable, recruitment and retention and low morale, which would inevitably impact availability of provision. Unless the Council addressed sustainability in a meaningful and enduring way, that properly reflected its recognition of the challenges providers were experiencing and by approving the proposed three-year financial plan which uplifts rates as recommended, there was a real risk that markets will become increasingly vulnerable. This would lead to increasing market exits and an inability of the Council to fulfil its statutory obligations, in addition to the undermining of key strategic priorities if the market shrunk or becomes less responsive.

Agreed;-

(1)     that approval be given to the three-year financial plan for the adult social care provider market to ensure market sustainability;

(2)   that the Adult Social Care Domiciliary Care standard hourly rate is increased from £16.92 per hour from 1 April 2023, subject to the proposed uplift being compliant with the Public Contract Regulations (PCR) 2015, with proposals from April 2023 to March 2026:

(3)    that should legal advice not support an uplift of the Domiciliary Care rate in 2023/2024 to £18.40, which is the rate calculated using the formula in the contract plus an extra £0.32 for market sustainability, the rate of £18.08 is implemented instead;

(4)    that the Promoting Independence and Rapid Response/ Wrap Around services hourly rates are also uplifted to align with the Domiciliary Care rate from1 April 2023 and to the rates thereafter;

(5)      that the Adult Social Care Supported Living hourly rate is uplifted to mirror the Domiciliary Care rate from April 2023 to March 2026, but paid at £17.08 initially in 2023/24, with the rate reviewed on completion of the planned Cost of Care exercise to determine if the exercise concludes there should be this parity, with approval to be paid up to the Domiciliary Care rate, if appropriate and backdated to April 2023;

(6)      that the Adult Social Care Extra Care hourly rate is aligned to its standard Domiciliary Care hourly rate from April 2023 onwards, and when the rate is uplifted thereafter;

(7)     that the Council’s Adult Social Care Direct Payment rate is aligned to its standard Domiciliary Care hourly rate from April 2023 onwards, and when the rate is uplifted thereafter;

(8)     that the Adult Social Care residential and nursing care home standard rates for Older People are uplifted as outlined below where they are below these rates, with any uplift to the Free Nursing Care rate to be fully passed onto applicable nursing homes when announced as follows:

(9)     that the Adult Social Care residential non-standard care home rates for the complex care (Learning Disability, Mental Health, Memory and Cognition, Physical Disability and Sensory Impairment) market are uplifted by 10.25% from 1 April 2023;

(10)   that the Adult Social Care nursing non-standard care home rates for the complex care (Learning Disability, Mental Health, Memory and Cognition, Physical Disability and Sensory Impairment) market are uplifted by 6.45% from 1 April 2023, with any uplift to the Free Nursing Care rate in 2023/24 to be fully passed onto applicable nursing homes when announced;

(11)  that a principal is created that the residential and nursing non-standard care home rates for the complex care (Learning Disability, Mental Health, Memory and Cognition, Physical Disability and Sensory Impairment)  market are increased in line with the applicable inflation rate calculated for Older People’s residential and nursing care homes for 24/25 and 25/26, and that any uplift to the Free Nursing Care rate is also fully passed onto applicable nursing homes when announced;

(12)  that the Adult Social Care day care rates are uplifted by 10.25% from 1 April 2023 and mirror the inflation paid for Older People’s residential care in 2024/25 and 2025/26;

(13)  that the Personal Assistant rate is uplifted as per the formula used in previous years, including growth in National Minimum Wage from April 2023 to March 2026;

(14)   that individual negotiated rates are in place for those people with more specialist needs and where the provider is not willing to accept the Council’s standard rate for care and support, approval is sought that the individually negotiated residential care home rates paid above standard rate are uplifted by 10.25% from 1 April 2023 and mirror the inflation paid for Older People’s residential care in 2024/25 and 2025/26;

(15)   that in connection with Resolution (14)  above, the individually negotiated nursing care home rates paid above standard rate are uplifted by 6.47% from 1 April 2023 and 6.45% for nursing dementia from 1 April 2023, and mirror the inflation paid for Older People’s nursing residential care in 2024/25 and 2025/26, with any uplift to the Free Nursing Care rate to be fully passed onto applicable nursing homes when announced;

(16)   that it be noted that there is a risk that the proposed three-year financial plan may be insufficient to manage market pressures in the years identified given the projected budget settlement, however, should the financial assumptions made for 2024/25 and 2025/26 not be accurate and additional % uplifts are necessary, that further paper(s) are presented to Cabinet to seek approval for addressing any deficits indicated;

(17)   that the Director of Adult Social Care in consultation with the Cabinet Member for Adult Social Care and Health be authorised to submit the final Market Sustainability Plan to the Department for Health and Social Care by the date required, currently set as 27 March 2023, subject to the Leader and Section 151 Officer approving the report content before submission.