Emma Watt, an associate at Anthony Collins Solicitors explains what home care providers must do to challenge their councils over an ‘unacceptable’ lack of fees to cover the cost of COVID. Her column follows the news that Worcestershire County Council has proposed to increase its provider rates by 0%.
Many organisations have been operating a ‘buy now, budget later’ approach to Covid-19, which prioritises the safety of customers and staff over the bottom line.
It is well-document that social care is significantly underfunded and home care providers will be all too aware that Covid-19 has resulted in significant cost increases which are unlikely to disappear any time soon.
In its October 2020 report on adult social care funding and workforce, the Health and Social Care Committee set out the impacts of adult social care funding shortfalls and called for an increase in annual funding of £3.9 billion by 2023-24. It added, however, that this was just a starting point and “further funding…is required…as a matter of urgency.”
The Covid-19 pandemic has heightened this urgency and pushed many providers to breaking point as you rapidly adapt to changing legislation, a desire to safeguard your employees and continued pressure from commissioners to find cost savings.
Whilst some financial relief has been offered by the government in the short-term, these emergency funds are a finite resource and will come to an end before the virus has come under control.
With the government focussing on recovery and a transition out of Covid-19 special measures, it has fallen upon providers to find the magic money tree needed to maintain ‘business as usual’.
Providers need to consider how they finance these changes in the longer-term and the prospects of recovering their unfunded outlay to date if that is significant.
What are the actual costs?
We know that domiciliary care is more costly as a result of Covid-19 and whilst obvious to those on the front line, it can be harder to convince commissioners of this. Our experience when assisting providers with negotiating fee increases is that you should be able to demonstrate the differences in operational costs arising from:
- the price and volume of Personal Protective Equipment (“PPE”);
- the cost of Statutory Sick Pay (“SSP”) or any enhanced payments to compensate staff whilst they isolate;
- the provision of testing kits;
- the higher cost of insurance cover and reserves for uninsurable risks;
- upgrades to new IT systems for digital care records;
- enhanced training for Covid-secure environments;
- cycle to work schemes and workarounds for public transport; and
- increased administrative and management costs.
Local authorities have been reminded of their duties to work in partnership with providers and find ways to ensure that essential services remain financially sustainable.
Both local authorities and providers are required to demonstrate transparency in their financial calculations and there is an expectation and, in our experience benefit, in you working on an open-book basis when applying for financial relief.
As we enter the next round of annual fee negotiations, now is the time to think longer-term with regards to care costs, and have a realistic conversation about the true cost of Covid. I would be happy to support any providers with this process.
Financing the ‘new normal’
The Covid-19 pandemic has reinforced our knowledge that social care is the fourth emergency service. The sector now needs the financial backing from commissioners if it is expected to absorb Covid-19 related costs whilst also maintaining safe, effective and quality services.
A failure to engage in an open conversation with commissioners now will inevitably mean providers will lose out and it will be assumed that you are able to absorb these costs, so a proactive approach is required. Providers who remain silent or who are reluctant to push back on unacceptable proposals will inevitably miss out.
We find that those providers that have kept good records of the changes they have made to their services and the associated costs of meeting their legal requirements, demonstrated an ability to innovate and respond flexibly, and have risen to the challenge of the new ‘best practice’ are in the best position to ensure that the cost of Covid-19, both now and in the future, is apportioned fairly between them and their commissioners.
Whilst commissioners will stress that their own resources are limited, they have themselves benefitted from streamlined assessment processes and reduced demand on certain community services which enable them to reallocate resource and prioritise home care in their budgeting process.
Where commissioners fail to acknowledge the economic reality of home care, we expect to see a significant move towards private-payer models, leaving commissioners with no choice but to pay at the private rate or operate a home care team in-house.