Rock and a hard place

Andrea Sutcliffe, Chief Inspector of Adult Social Care at the Care Quality Commission.

Last week’s announcement of CQC’s fees scheme for 2016–17 definitely deserves the description “between a rock and a hard place” for the providers affected and CQC itself.

At a time when everyone is very aware of the financial pressures affecting the health and social care sector, that providers have been asked to contribute more to their own regulation has not surprisingly raised concerns. The policy is not one of CQC’s own making — the government has set clear objectives that Arm’s Length Bodies like ours recover the full cost of their activities through fees.‎ This is from The Treasury “bible” Managing Public Money:

“Charges for services provided by public sector organisations normally pass on the full cost of providing them…The standard approach is to set charges to recover full costs”.

CQC Budget

In 2015/16 CQC’s £249 million budget was funded by £113 million fees raised from providers and £136 million Grant-in-Aid from the Department of Health. Over the next three years, this balance will progressively change and by 2019/20 our Grant-in-Aid will have reduced to £18 million and income raised from fees will increase to £199 million, meaning that our budget overall will be £32 million less.

So, providers are paying more, CQC is getting less and the Department of Health is making a saving. Next year the pattern is likely to be repeated although the precise figures are yet to be set.

Are we worth it?

It is vitally important that the health and social care sector has a strong and robust regulator capable of enforcing the standards of care we all have a right to expect and encouraging services to improve. ‎Despite the continued reductions in our budgets we will work very hard to make sure this does happen. Already we can see some services improving their ratings, providers acknowledging that our inspections and reports help them to improve, and the public using our reports to inform their choices. In addition, our enforcement action is increasing as a proportion of our inspections giving a clear signal that we will hold providers to account when they fail to deliver good care.

Of course, we cannot be complacent and in May we will publish our strategy for 2016–2021 setting out how we will strengthen our regulation of health and social care through better use of information, targeted and tailored inspections and improved processes. All this will focus on improving our efficiency and effectiveness and making sure that we can demonstrate to the public and providers that we are worth it because we do make a difference to the lives of people using services.

Adult social care impact

Much of the commentary on the fees has been dominated by the reaction from the NHS and GPs, but what does this all mean for adult social care?

I want to first acknowledge the concerns that social care leaders have raised. Coming in the same week that the National Living Wage was introduced (although welcome, it will intensify financial pressures in the sector), I can understand the dismay that ‎our announcement generated with, for example, the Voluntary Organisations Disability Group stating that they ‘strongly oppose this measure’ and the National Care Association describing their members as ‘deeply disappointed’.

The arrangements for care homes and domiciliary care agencies are different.

Traditionally, care homes have been closer to full cost recovery than other sectors so the increases when compared for example, with GPs are proportionately lower and reaching full cost recovery will happen over two years.

For domiciliary care agencies, the assumptions in the fees modelling were reviewed this year and showed that DCAs were further away from full cost recovery than previously thought. This has led to more significant % increases and in recognition of this, reaching full cost recovery will take four years.

Answering specific criticisms

Some of the anger at the announcement has also focused on the process of consultation, decision-making and communications. We are legally required to consult on our fees scheme and the Board carefully considered the preference from all sectors affected for the move to full cost recovery to happen over four years. That would have led to bringing forward to next year a very significant reduction in our budget which we could not bridge with further in-year savings and the Department of Health was unable to cover. I think it is fair to say that our recommendation to the Secretary of State was a reluctant one.

In order to publish our fees scheme, we needed the Department of Health to provide consent. While CQC and DH staff had worked very hard since the closure of the consultation to reach a conclusion, ultimately the timing of the announcement rested on us receiving this. I am sorry that this meant it happened so close to the start of the new financial year.

Future strategy

Finding additional fees in a difficult financial climate will never be universally welcomed. Providers are right to expect that the ‎way we use resources should demonstrably make a difference and support better care. This is what the public expect too — after all, it is either their fees as self-funders or public money from local authorities or the NHS that provide the income for providers to pay fees to CQC.

The strategy for 2016–2021 that we will publish in May will set out how we intend to do this, working in co-production with people who use services, providers, commissioners and others. While we have our differences about the implementation of the fees strategy, I hope the strong foundation ‎of joint working we have built over the last few years will sustain and develop as we all face the challenges of the years to come.


Originally published at www.cqc.org.uk.