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Residential and Nursing Care Fee Review

Consultation Stage 2

Why is the council Reviewing Fees?

• The current arrangement have been in place since 2011

• Council’s strategic aim is to support people to live in their own homes

• However some people need the support that only a care home can offer

• With over 2,000 people in care homes, they make a critical contribution Leicestershire’s health and social care system

• The Council has to balance the increasing cost of care homes with limited funding from central government and Council Tax

Consultation – Stage 1

• The consultation is in 2 stages, no final decisions will be made until both stages are complete and approved by Cabinet in June.

• A provider reference group was formed to develop the proposals

• Stage 1 covered: • A new 2 Band approach for Older Adult placements

• Developing standard hotel cost for Working Age Adult placements

• A process for agreeing annual uplifts

• Options on rates for out of county placements

• Changes to the core contract, schedules and QAF payments

Stage 1 feedback received

• 6 questionnaires completed.

• 14 providers attended consultation meetings

• Direct contact with advocacy organisations

• Individuals with deferred payments contacted directly

• Contact with EMCARE

• Scrutinised by elected Members

• Full report on consultation 1 is available online

Feedback summary

• Support for 2 band approach for older adults

• Limited response on the use of the care funding calculator

• Support for the cost modelling template

• Support for developing an annual fee review process

• No support for paying LCC rates for out of county placements

• Support for revising the core contract and specification

• Mixed views on removing voluntary QAF payments, but concern that staff still need to be recognised

• Support for aligning core contract and CQC.

Stage 1 Proposals

Proposal 1 - Replace the current 5 band Residential and single Nursing band system with a two-band system

Proceed with Proposal 1 to develop a two-band system for Older Adult Placements, together with a standard hourly rate for SNAs.

Proposal 2 – Use of the Care Funding Calculator for Working Age Adults (WAAs)

Refine Proposal 2 to develop a Leicestershire standard band for working age adult accommodation and use the National Care Funding Calculator for ‘specialist’ and/or complex care placements.

Proposal 3 – A review of the Council’s standard cost template

Proceed with Proposal 3 to use of the standard cost model template

Stage 1 Proposals (cont…)

Proposal 4 – Annual Fee Review

Proceed with Proposal 4 to develop a mechanism to apply annual increases automatically for 3 years and seek proposals on mutually beneficial efficiencies.

Proposal 5 – Out of County Placements

Not to proceed with Proposal 5 to pay Leicestershire banded rates to out of county providers. The assumption going into Consultation 2 is that out of county cases will be paid at the locality rate.

Proposal 6 – Core Contract and Specification Refresh

Proceed with Proposal 6 to review the core contract, specification, Individual Placement Agreement and remove the QAF payments.

Comments or queries on stage 1?

Stage 2

• Proposed rates

• Annual uplift mechanism

• Proposed contract, specification and individual placement agreement

• Proposed implementation

Consultation – Stage 2 - Rates

• Proposed fees for Older Adults

–Residential - £561.00 (£576.03 for 2019/20)

–Residential Plus - £619.00 (£635.59 for 2019/20)

• Proposed Supplementary Needs Allowance hourly rate (older people) - £11.36 (£11.72 for 2019/20). Not used for care within the specification or as “top up”

• Proposed fee for Working Age Adults - £705.00 (£723.89 for 2019/20)

• CFC will be used for more complex placements

• Annual proposed uplift for 2019/20 – 2.68%.

• December published rate of AWE (3.2%) services element and CPI (2.0%) at a ratio of 57:43

Consultation – Stage 2 - Contractual Changes

• Draft Core Contract, Specification, Band Definitions and Individual Placement Agreement for consultation

• Aligning quality requirements with CQC and no separate QAF

• Tightening signatory requirements for the IPA where the resident does not have capacity to sign

• Updating Band Definition to specify the level of need and assumed average hours of individual care for Residents

• 19 hours for Residential

• 24 hours for Residential Plus

Consultation – Stage 2 - Implementation

• Fee increases backdated to 8th April 2019

• Use of current bands until the fee review is complete

• Administrative transfer where possible, eg current Band 3 cases to Residential

• Proportionate Review of more complex cases

• LAAF and SNA rolled into the new Band where possible

• TPTUs rolled into the new Band where possible, removing and reducing the payments made by families

• Completion within 6 months of Cabinet approval to implement

C.CO Cost of Care Report

We are C.Co; CIPFA’s consultancy service

Leicestershire County Council – Cost of Care

Consultation 2 – Provider Launch Event

26 March 2019


Contents

Project Phase 1

Review Activity

Data Quality

Options for Care Fees

Supplementary Needs Assessments

Annual Uplift/Indexation

Next Steps


On 3 October 2018 the Council and C.Co launched the review at the Provider Reference Group CIPFA C.Co Ltd was been engaged, by the Council to:

To review LCC’s current cost of care model and component budgetary elements To make recommendations and align with best practice To create an ‘Excel’ template care funding calculator for each market - Older adults - Working Age Adults Undertake provider engagement and consultation, on the template, through the Provider Reference Group

Then…

To populate the template based upon data provided, best practice and national benchmarking and a cross-section of identified providers Produce indicative fee levels upon which the Council could consult as part of consultation 2

Project Phase 1


Fee review template was devised, shared with PRG and revised following feedback Consultation on the construct of the template was included as part of consultation 1 Formal request for completion of the template/provision of data issued on 16 November 2018 C.Co co-ordinated the collection of data and responded directly to provider questions and/or requests for clarification Data collated, sorted and modelled National and regional benchmarks were used to test the local fee results Indicative fees informed ‘affordability’ modelling by the Council Fee report produced, presented and discussed with LCC

Review Activity


To expedite the review process, data was requested from providers outside of but running parallel to consultation 1 Options to complete the template or send in other forms of data capture such as profit and loss statements were given Some fee data was sent in directly to C.Co and some via the Council There were 37 submissions of ‘provider data’ including where providers has sent in data for multiple properties, but only 13 of these were received on the agreed template To provide a meaningful cost of care, C.Co has consolidated available data into three distinct areas: the cost of staffing; the cost of paying for and running the home; and the returns of overhead, any return on capital and profit As this was a ‘local’ fee exercise, data received for ‘group’ or ‘out of area’ provision was excluded from calculations There was a significant variation in the format, quality and depth of data provided that impacted the ability to produce robust fee results. As a result, our options for Residential and Residential Plus provide a fee range rather than a definitive fee. Fees were ultimately modelled on the following cohorts: - Older Age Residential, 8 properties - Working Age Adult, 5 properties

Data Quality


The size of the cohorts meant that the submission of one set of provider data could have a disproportionate impact on the overall fee level, the removal of one or more provider from a cohort clearly has an impact on the overall size of that cohort and the ‘local’ information from which to derive a fee. As a result, C.Co is unable to provide a definitive care fee for Older Age Adults and has therefore modelled an upper and lower limit. This range provides options for the Council to consider during the next phase of consultation. All fee ranges and proposed rates are based on 2018/19 data and will require ‘uplift’ for 2019/20 Given the low volume of returns and the variance in format, quality and depth of data, C.Co is proposing a standard local ‘residential’ cost of care for older age adults of between £561 and £585 per resident per week This is based upon 2018/19 data and includes a 2.4% enhancement to reflect an occupancy rate of 93%, rather than a fee based upon 100% occupancy.

Older Age Residential


Two banded model supported through consultation 1 Council proposing to consult on 19 hours of care for Residential and 24 hours for Residential Plus. Proposed fee ranges assume this split of care hours

C.Co has proposed 3 options for Residential Plus each of which use the ‘residential’ rate as a base figure but increase the staffing element to reflect the difference of 24 rather than 19 hours of care per week required. The options are presented as follows:

Increase the staffing element for 24 hours of care by the proposed SNA blended hourly rate of £11.36, for each additional hour of care. This would provide a range of between £619 and £643. Increase the staffing element by 26% to reflect the percentage increase in care hours between ‘residential’ and ‘residential Plus’. This approach would see a residential Plus rate of between £645 and £671. Increase the staffing element by 35% to reflect both the increase in care hours and a recognition that more complex care may require more training and backfill, require more one to one care and reflect a ‘well-being’ need for the individual carer. This approach would see a residential Plus rate of between £674 and £701.

Older Age Residential Plus


Although the new Residential and Residential Plus bands should reduce the overall requirement for SNAs, C.Co has modelled an ‘on costed’ hourly blended rate for SNAs C.Co’s proposed methodology is based on a 70:30 single blended rate of £11.36 for additional hours of care provided by a carer and senior carer

The blended rate includes a 5% premium for non-core hours

Supplementary Needs Assessment


The original intention was to produce standard local ‘hotel’ costs for working age adults along the lines of those identified in the National Care Funding Calculator (NCFC) However, the lack of templated, granular local data to support the modelling exercise has meant that C.Co has only been able to produce a figure constituting the three broad areas of staffing, running costs and operators’ return C.Co is, therefore recommending a standard cost of care for working age adults of £705 The Council, therefore has an option to consult on the C.Co local data figure or to adjust it to reflect the CFC hotel cost. It is recommended that the NCFC is used to determine fees for care in excess of the standard £705 rate

Working Age Adults


C.Co was asked, using its knowledge of the market and experience, to determine an appropriate methodology that will enable a consistent and fair annual increase of care fees C.Co is recommending a ‘blended’ rate of increase that takes account of the percentage change of the ‘Service Sector’ element of the Average Weekly Earnings (AWE) and the Consumer Price Index (CPI) datasets both published by the Office of National Statistics (ONS) C.Co is proposing two options for the ‘blend’: 1. Applying AWE to staffing costs only, with CPI being applied to the remaining

elements, a 57:43 split 2. Applying the AWE rate to all direct costs and CPI to non-direct costs, a 77:23 split

Using the latest rates published in December 2018, option 1 would provide a rate of 2.68% and option 2 a rate of 2.98%.

Annual Uplift


Ian Kirby Programme Director C.Co - CIPFA’s Consultancy Service CIPFA, The Quadrant, Sealand Road, Chester, CH1 4QR [email protected] 07384698220 www.WeAreC.Co Keep in touch! Sign up today to receive all the latest news from C.Co and across the sector https://wearec.co/subscribe/

Next Steps

• Consultation 2 – Tuesday 26 March to Tuesday 7 May

• Visit us online at: resources.leicestershire.gov.uk/provider-fee-review

• Complete the Questionnaire

• 7 further consultation meetings

• Planning a public meeting jointly with Healthwatch

• Feedback via: [email protected]

• Call Dave Pruden or Julie Drake on 0116 305 0232

mailto:[email protected]

Questions and Answers Questions and Comments?

Residential and Nursing Care Fee Review › sites › ... · The Council, therefore has an option...

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