What are local authorities paying for home care across England?

Access Group – Steve Sawyer Headshots cropped

The average invoice rate for state-funded home care was £16.88 per hour in March 2019, way below the recommended rate, a new report shows.

The data from March 2019 shows that the rate increased 53p from March 2018, but was still £1.13 below the UKHCA’s recommended ‘Minimum Price for Homecare’ of £18.01 in 2017/2018 and £18.93 per hour in 2019/20.

The analysis by business software provider the Access Group found that bill rates varied between just £15.04 in the West Midlands and £18.24 in the South West.

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The UKHCA estimates business costs, including office staff, premises and utilities, consumables and other overheads and services at £4.41 per hour of care.

Using this figure shows that on average, when full costs are accounted for, home care providers are making an average loss of £1.68 per hour of state funded care, according to the Access Group.

Factoring in costs for travel time pay, pension contributions, employer’s National Insurance, holiday and average travel distance gives an average hourly margin before operating costs for each region, with a national average margin of just 15%, or £2.51 per hour of care.

These average margins before operating costs are fairly consistent across all regions, ranging from 11-20% and £1.64 to £3.66 per hour.

Regional pay rates varied between £8.06 in Yorkshire and the East Midlands and £9.48 in London and the South East, indicating that most providers are paying above the National Minimum Wage of £7.83 (as of April 2018).

“It is of course providers’ legal obligation to adhere to the National Minimum Wage. However, the fact that the data shows that they are doing so, and paying above the minimum, under such tight funding and small-to-loss-making margins, demonstrates the determination and commitment of many providers to do the right thing in an ever-challenging environment for the sector, the Access Group said in a statement.

Earlier this month, the Access Group called for increased funding to enable providers to offer higher standards of care.

It said that that care providers that deliver a greater proportion of 60-minute visits are more likely to be rated ‘Outstanding’ by the statutory regulator, the Care Quality Commission (CQC).

Caption: Steve Sawyer, managing director of the Access Group’s health and social care division.

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Sarah Clarke

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