An approaching impact: The UK’s adult social care reform

20th March 2023
An approaching impact: The UK’s adult social care reform

Lewis Pirie, our Business Development Representative, explains how the reactive approach taken with the new Adult Social Care Reform, the “Fair Cost of Care,” can potentially end up harming the health and social care system.

By now, most of us will be aware of the universal challenges that adult social care is facing. Local Authorities are facing budgetary restrictions, increased demand for care and trouble retaining and recruiting staff. With the upcoming reform to adult social care, one would think that things can only get better, but sadly, if the changes keep happening at their current pace and format, circumstances will continue getting worse.

However, most worryingly of all, the majority of people involved with social care haven’t considered the impact the legislative changes will have on the delivery of care. When people were asked what their thoughts were on how the proposed legislative changes will affect the delivery of care, 65% hadn’t even considered it. This shows that more people need to be aware of what changes are coming


What are the changes?

The changes introduce major reform to adult social care, with amendments to the means test for social care and a cap on social care costs being some of the differences introduced. Private payers will now be able to go to their Local Authority and ask them to arrange their care. These self-funders will have to have a “care account” with their local authority to track when they will hit the lifetime cap for social care (which has been set at £86,000). As local authorities have access to cheaper rates of care it is safe to assume that they will see an increase in the number of people looking to access their services.

To combat the loss in revenue that care providers will face, the government is also planning to intervene in the social care market, with the intention of ensuring that local authorities pay a ‘fair cost’ for care. This ‘fair cost of care’ aims to increase the fees paid by Local Authorities for care with the aim to make the care market more sustainable. In order to do this, Local Authorities will have to sit and talk with their suppliers to understand what their cost base is and how they charge in order to come up with a median cost per Local Authority. The UK Government can then ask the local authorities to pay that median in an attempt to make the market more sustainable. 

The issue with this is that 80% of Local Authorities’ budgets are already spent on social care, so affording to pay any increases to the cost of care has become simply impossible. The Government has pledged to allocate Local Authorities £378,000,000 per annum to cover care home placements and to protect providers from revenue losses when private payers go to the council to arrange their care. But again, this is nowhere near enough to cover costs, with some reports suggesting that they will need between 2x and 4.5x this amount per annum.

The changes are due to be introduced in October 2025 and will have immense impacts on service users, care providers and local authorities. 

Elderly couple mini-figures placed on bank notes. Metaphor of navigating the cost of care reform.


What impact will this have?

The biggest impact facing Local Authorities will be identifying self-funders. How many self-funders will go to each local authority is currently unknown, as well as who they are and what services they require. Naturally, more staff will be needed to deal with this, and one Local Authority I was recently speaking to said that they would need at least 70 additional care workers to meet this demand, this being on top of the roles that they are currently struggling to fill. And while the number may be unknown, initial sums suggest that there could be a 30% increase in Service Users for local authorities to deal with (this is equivalent to 1,600 service users per local authority – and this is before population growth is taken into account).

Self-funders, as previously mentioned, will now be able to go to their local authority and ask them to arrange care that meets their needs. As a result, they will have a Care Account with their council where they will undergo financial assessments every year, on top of the care assessment that everyone is already entitled to. 

While the aim of the changes is to improve things in the social care sector, in reality, they will harm the availability and quality of care. There will be an increase in pressure on a workforce already facing recruitment and retention problems, and there could potentially be reduced choices for service users as providers could collapse if rates are impacted too much.

The changes also fail to address existing issues facing social care. While the changes will help around 40-50,000 people each year access state-funded care, they will still need to pass a very strict means test to access these publicly funded services. The needs test has been getting stricter and stricter as local authorities’ budgets struggle to keep up with the demand, and these changes will only exacerbate these issues and increase unmet needs. The changes also fail to provide any long-term solutions to the workforce issues, with no mention of pay for staff in any of the changes.


What needs to change?

It is clear that something needs to change before these changes take place – otherwise, the social care sector will be doomed to fail. The current way of working is not sustainable and a shift in approach is critical. A switch from a reactive approach to a proactive one will prove to be decisive if local authorities are to overcome these upcoming challenges, with a proactive approach enabling people to get the right care at the right time, helping to avoid crisis events and practising cost avoidance.

The use of data is something that will also help alleviate the issues front-line workers are facing. Data can be used to help inform better decision-making during key stages of the social care journey. For instance, during care assessments, it should be commonplace for data to be used by care workers to help inform which package of care is suitable for the service user. 

What this shows is that while the upcoming changes to legislation will massively impact the industry, we will need to transform the way we work if we want to resolve the existing issues the system is facing and prevent the potential ones impending.

by Lewis Pirie

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