Care market conundrum
by Claudia Wood
As the Winterbourne View scandal shows no sign of dying down, what began as a Panorama exposé has now opened up a broader debate about the sustainability of the residential care market
The situation at Winterbourne View, and many other residential homes involved in scandals over the years, is not just a case of individual staff brutality. There are systemic problems that allowed these situations to occur in the first place: poor levels of accountability in middle management, no oversight higher up the food chain, and fundamentally, a lack of high quality recruitment and training to ensure people with the right experience and skills were in post.
No one at Castlebeck, which owned Winterbourne, intentionally created such problems. Organisational culture plays a part, but we must look more closely at the care market in which providers operate before apportioning blame. When Winterbourne dominated the front pages, business sections were focusing on the financial collapse of Southern Cross – one of the biggest residential providers in the country. Both situations stem from a dual problem in the market.
First, local authorities are facing unprecedented budgetary cuts, on top of a chronically underfunded care system. Cash-strapped councils, in making their resources go further, are using their position as the largest single purchaser in the residential market to drive down prices, even below cost, leaving providers seeking economies of scale and cross subsidisation to stay afloat.
Second, as part of the personalisation agenda, there is a policy shift at national and local level to reduce the use of residential care, as it is seen as incompatible with independence, choice and control. Many local authorities are therefore investing in supported living in the community. Thousands of residents have been moved out of homes and into extra care and newly built apartments. Even where residential care is used, commissioners are looking for smaller more personalised residential settings rather than large ‘institutions’.
These opposing forces are creating an impossible situation. The downward pressure on prices makes chains of large homes the only way to achieve financial sustainability. But as fewer beds are being commissioned, so large homes will often find a significant proportion of beds going empty. Residential providers are being pressurised to downsize and personalise their offer, without the increase in funding this entails.
This can help explain Southern Cross, but what of Winterbourne View? Well, smaller margins mean less money to spend on staff training and recruiting people above the minimum wage. Winterbourne’s fees were £3,500 per week, but it is likely the money was being used to prop up other homes where Castlebeck was making a loss.
The fact that Castlebeck is a large franchise – to reap economies of scale in a tough market – no doubt exacerbated the accountability and communication problems that resulted in individual staff members going unchecked.
The fact remains, however, the we still need residential care – for those with multiple and complex needs, older people with dementia, and others for whom supported living is not attainable.
And at this point, the Department of Health has to face facts. An inevitable result of a reduced residential population is the need for a smaller number of specialised, high-cost placements for those with the most complex needs. But providers cannot transform their stock into small specialist units overnight, nor can they be expected to remain afloat offering these services if chronic underfunding continues.
The savings made by moving people out of residential care must, therefore, be put back in to the market to drive service transformation, and to give providers a fee that reflects the costs of caring for high-need groups. At the moment, the government’s vision for niche residential care and the realities of the market do not match – leading to policy drivers and financial incentives moving in different directions.
Unless the deadlock is resolved, more providers, like Castlebeck and Southern Cross, will be caught in the middle of this unfortunate tug of war.