The Care Bill's 'Epic Changes'

As many of you will be aware, the Care Bill is currently making its way through parliament, and is likely to have a significant impact on the sector. There are a number of issues which have been highlighted regarding the legislation, and with the Bill’s finer points being debated in the committee stage and likely to become law by April, anyone involved with the care sector should be following its progress closely.

The Bill constitutes the Government’s main legislative response both to the Francis Inquiry into the Mid Staffordshire scandal and the Dilnot Report into care funding. Its headline policies are the introduction of Ofsted-style ratings for hospitals and care homes, and a cap of £72,000 on the amount that any individual will have to spend on care in their lifetime. Once an individual reaches the cap, the Government will pay for their care – although basic living costs set at £12,000 per year are excluded from the calculation, and will still need to be paid by the individual after the cap on care fees has been reached.

The Bill also does the more prosaic job of consolidating previous social care legislation into a single legal framework – “epic changes”, in the words of Health Secretary Jeremy Hunt. Because these changes alter the structure of care funding and regulation in the UK, it is worth analysing the potential challenges they present for independent care providers.

One amendment currently attached to the Bill would grant all care users the power to challenge their providers under the Human Rights Act. Currently, only those in taxpayer-funded care are protected by the Human Rights Act; as it stands, the Bill would extend that protection to include those who pay for their own care. This amendment, which was passed by the Lords against the wishes of Government ministers, would increase care providers’ liability to legal challenge from their users. The charity Age UK argues that the amendment is necessary because the current arrangement makes “second class citizens” of the “175,000 older people in independent care homes who pay for their own care”. The Government disagrees, however, saying that the CQC already guarantees identical rights of appeal, and Care Minister Norman Lamb has already tabled a motion to have the amendment removed. The Minister argued that the purpose of the Human Rights Act is to protect the citizen from the state, and that to extend its provision to cover a private contract between care provider and care user would be “a contortion of the legislation”. It remains to be seen whether Labour will put up a fight on the issue.

Another potential issue, as Nick Kirwan of the International Longevity Centre UK has argued, is that the Bill makes it compulsory for Local Authorities to arrange care for self-funders if they ask for it. This is a problem because Local Authorities use their buying power to command cheaper rates when they contract independent care providers – often at or even below the cost of that care. Those providers make up the shortfall by charging higher prices to self-funding care users for identical care – this is called cross-subsidisation. Because the Care Bill allows self-funders to access those lower Local Authority rates, it has the potential to drive some independent providers out of business.

This will be exacerbated by another change, which allows Local Authorities to charge fees for arranging care at the request of self-funders. Local Authorities are likely to treat this as an attractive option for raising revenue, and therefore actively promote the service, which would increase the number of self-funders on lower fees, and further threaten the financial stability of independent providers, and their ability to deliver care.

A final issue with the Bill is associated with the implementation of its £72,000 cap on care costs. The Bill grants significant freedom to individual Local Authorities to decide how much care costs and therefore how quickly care users will reach the cap. Experts are worried that this localised approach will encourage care users to “game the system” by moving to Local Authorities which have higher care costs in order to reach their cap sooner.

Much is still to be finalised with the Bill, but whatever happens between now and April it is likely to revolutionise care funding in the UK. Those with an interest in the care sector – be they a provider, a resident or a relative of someone in care – should take a keen interest in the Bill’s progress over the coming months, in order to be prepared for the changes it will introduce.