Funding and costs: Commissioning home care for older people

The home care market in England is valued at £5.5 billion, covering six million hours a week. Public spending accounts for £2.2 billion of this figure and the rest is privately funded – although some of the privately funded care is publicly provided. [4]

Demand for long-term care is growing and is set to reach a peak in 2040. Funding issues include:

The following could go some way to alleviating these problems:

It is suggested that local authorities or health and social care trusts start looking now at how to set up funding mechanisms that straddle the current boundaries of the different organisations involved in care. [4]

The literature reviewed for this guide puts forward a range of ideas on the affordability of home care for older people. But none was able to provide comprehensive cost-effectiveness analysis of home care provision for those with complex needs.

There are tentative claims that flexible, personalised care may not cost much more than conventional home care roles. [6] Pay, conditions and training of staff are seen to play an important part here. Staff working for independent service providers are paid less than those working for local authorities, have fewer benefits and get less training. This is often due to the reduction of costs implicit in commissioners driving down the price they are prepared to pay service providers for care. [6]

To provide the kind of personalised care that older people want and deserve, staff need to be better paid, better trained and receive specialist training in working with older people with complex needs. [4, 14, 20] Well-treated and enthusiastic staff can provide extra help, which costs the public purse nothing. [6]

Good home care for older people can and should be preventative, to reduce the use of services such as ambulance call-outs, Accident & Emergency departments and unplanned hospital admissions.

This is dependent on sufficient funding being available to fund personalised packages of care and approaches. The fact remains – the needs of people with complex needs require intensive specialist support for long periods of time, which costs more than standard care. [10]

If home care is to fulfil a preventative role and make it possible for people to stay in their own homes – no matter how complex their needs are – the following are likely to be helpful:


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