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broken mirror | Care Home Providers Guidance

Five reasons why social care lies “fractured and forgotten”

Five main factors are the cause of market instability in social care, according to a report by the Nuffield Trust.  

The publication, Fractured and forgotten, the social care provider market in England, highlights the following:

Downward pressure on fees paid by councils creates inequality, uncertainty and variation

Lack of reliable market data limits innovation and drives short-termism: annual budgeting and staff turnover at local authority level encourage highly transactional relationships between providers and commissioners and a lack of focus on innovation.

Few proactive drivers of system improvement or market management: transactional commissioning, lack of information and consumer reluctance to switch provider provide few incentives or rewards for proactive service improvement.  

Opaque ownership and complex underlying business models: care is an attractive market for hedge funds, property investors and private equity funds, but the viability of heavily debt-laden companies is highly sensitive to changes in the external environment, and there is no penalty to the provider for risky financial behaviour.  

Lack of prioritisation within government: accountability is split between national and local government, and there is a lack of good data and established communication channels with providers.  

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