Independent and voluntary homecare providers have been pushed to the brink of withdrawing care or going out of business completely, according to a recent survey.
A survey by the United Kingdom Homecare Association (UKHCA) found that many care home providers are critically underfunded, due to low fees paid by local authorities.
UKHCA surveyed 492 providers in the UK, with 63% of them trading with one or more local authorities. Many providers said they had been forced into handing back contracts to local authorities, because prices paid were insufficient for them to provide quality care.
Half of those surveyed said they had not tendered a bid for one or more contracts on offer, because the price was too low to run a viable business
UKHCA says evidence suggests that the home care sector will face significant instability over the next year, with as many as 74% of providers stating they would have to cut back on the amount of publicly funded care they deliver.
The survey also found that only 38% of providers felt confident they would still be operating in twelve months. 11% said they would ‘definitely’ or ‘probably’ have ceased trading completely by this time next year.
The majority of those surveyed (50%) expressed serious concern over the introduction of the ‘National Living Wage’ (NLW), which will see hourly wages increase to £7.20 per hour from next April and reach £9.20 per hour by 2020.
Nearly three-quarters (74%) warned that without proper funding the NLW would affect quality of care, potentially placing vulnerable and elderly service users at risk.
71% said current fees paid by local authorities would not cover the extra costs incurred from paying staff the NLW.
Colin Angel, Policy Director at UKHCA said: “A stable, effective homecare sector is vital to over 883,000 older and disabled people who rely on homebased care each year.
“The low fees paid by local councils and a lack of funding for the new National Living Wage, places the future of the home care market in an extremely vulnerable position.
“Rapid withdrawal from the homecare sector will create an additional burden on underfunded councils, who should be prioritising care for people who rely on home–based care, not dealing with local market failure to which they themselves have contributed.”