WARDS AFFECTED: ALL
REPORT OF THE STRATEGIC DIRECTOR OF SOCIAL CARE AND HEALTH
TO THE CABINET MEMBER FOR SOCIAL CARE AND HEALTH
29 April 2004
UPLIFT OF OLDER PEOPLE CARE HOMES AND CARE HOMES WITH NURSING
1. SUBJECT AND BRIEF SUMMARY OF PROPOSALS
1.1 This report sets out the recommendations concerning the uplift of fees for Older
People‟s care homes and care homes with nursing Contracts.
1.2 The current fee structure for Birmingham and “Near Birmingham” and for outside of
Birmingham care homes and care homes with nursing was agreed by Cabinet on
10th March 2003. For Birmingham and “Near Birmingham” care homes the fee rates
are £298 for a single room and £283 for a shared room. Birmingham and “Near
Birmingham” care homes with nursing attract the contract fee of £319 for a single
room and £304 for a shared room,
1.3 The above fee levels for care homes with nursing do not include the registered
nursing care contribution as the Council can no longer purchase nursing care on
behalf of service users.
1.4 The current fee structure for Birmingham and “Near Birmingham” homes also
include a Quality Assurance (QA) Premium of £12 per person per week and a £12
En-suite Premium for single rooms.
1.5 The fee levels for outside of Birmingham care homes were set at £298 for a single
room and £283 for a shared room. The fee rate for care home with nursing was set
at £298 for a shared room and £313 for a single room. Outside of Birmingham
homes do not attract the two Premiums.
1.6 Small care homes (less than three beds) attract a fee of £244.
1.7 The current fee structure was the outcome of consultation with homeowners and
was set within the Council‟s longer-term strategic aim of investment within the care
home and care home with nursing sector. Cabinet agreed a £7.5 million five-year
investment strategy for Older People‟s care homes and care homes with nursing
sector. This strategy involved the investment of the £7.5 million in fees over and
above inflation of which £3.5 million was front loaded into the first year with £1
million to be invested in the subsequent four years.
1.8 Homeowner representatives were presented with five options with respect to the
investment of this £1 million pounds. Officers examined the impact of these options
on the budget and their recommendations are contained within this report. The
Cabinet Member is requested to approve these recommendations.
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The Cabinet Member is asked to :
Agree to uplift the base fee levels for Birmingham and “Near Birmingham” care
homes including small care homes by 3.5%
Agree to uplift the base fee levels for Birmingham and “Near Birmingham” care
homes with nursing by 5%.
Approve the increase of the En–suite Premium for single rooms from £12 to £14
and the increase of the QA Premium from £12 to £22 per person per week.
Agree to uplift the fee level for existing residents and new residents in outside of
Birmingham care homes and care homes with nursing by 3.5%.
3.1 The existing fee structure for Older People‟s care homes and care homes with
nursing was agreed by Cabinet on 10th March 2003. The current fee structure for
Birmingham and “Near Birmingham” homes is as follows: -
Care Homes: –
Single Room - £298
Shared Room - £283
Care Homes with Nursing: -
Single Room – £319
Shared Room - £304
Small Care Homes (less than 3 beds) - £244
3.2 The care home with nursing fees do not include the Registered Nursing Care
Contribution as the Council can no longer purchase nursing care. However the
Council has single payment arrangements with all four Birmingham and three other
“Near Birmingham” Primary Care Trusts (P.T.C.s) to pay this nursing care
contribution on their behalf by acting as their agents.
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3.3 The above fee rates are also subject to two Premium rates as follows: -
Quality Assurance Premium - £12 per person per week subject to verification by
the Council‟s approved verifier.
En-suite Premium - £12 per person per week
Small Care Homes do not attract either of the two Premiums.
3.4 This structure was applied to existing and new Social Care and Health funded
Residents in Birmingham and “Near Birmingham” Homes. These “Near Birmingham
Homes” which are outside of the City‟s boundaries have a special relationship with
the Directorate which provides them with the opportunity to apply for the Premium
for single en–suite rooms and the Quality Assurance (QA) Premium.
3.5 The current fee structure for Care Homes and Care Homes with Nursing outside of
the City‟s boundaries for those residents placed after the 1st April 2003 are as
Single Room – £298
Shared Room - £283
Care homes with Nursing
Single Rooms - £313
Shared Rooms - £298
3.6 Outside of Birmingham homes do not attract the two Premiums. The Care Home
with nursing fee rate only includes the care price, as the Council does not have
single payment arrangements with their relevant P.C.T.s.
3.7 The current fee structure was an outcome of consultation with homeowner
representatives and set within the Council‟s longer term strategic aim of investment
within the sector to ensure sufficient numbers of care home and care home with
nursing places to meet the needs of the people of Birmingham. This strategy also
includes the development in partnership of the Council‟s Older Peoples Homes and
in the meantime, a continuing year on year reduction in unit costs of the Council‟s
own homes for Older People.
3.8 Cabinet also agreed on 10th March 2003 a five-year investment strategy for the
Older People‟s care homes and care homes with nursing sector. It was agreed to
invest a total of £7.5 million pounds in fees over and above inflation of which £3.5
million was to be front-loaded into the first year with £1 million to be invested in the
subsequent four years.
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3.9 During consultation with homeowners‟ representatives Officers presented five
options with respect to the investment of £1 million pounds plus an uplift of 3.5 % on
current base fee levels. These options ranged from investment of the £1 million into
the care home nursing sector only, an increase of the Q. Premium to £37 per
person per week to a fifth option from owners themselves.
3.10 Officers modelled the outcomes on the budget of all five options and recommend;
A 3.5% uplift on base fees for care homes including small care homes
A 5% uplift on base fee levels for care homes with nursing.
An increase in the QA Premium from £12 to £22
An increase in the En-Suite Premium from £12 to £14
3.11 The uplift for care homes with nursing reflects the cost pressures these homes face
from employing nursing staff.
3.12 The increase in the QA Premium would continue to encourage homeowners to
better standards of provision within the sector and builds upon previous investment
in encouraging homeowners to implement and maintain a Council approved Quality
Assurance system. The increase in the En-suite Premium would continue to reward
homeowners who have en-suite facilities in single rooms and encourage other
homeowners to introduce them.
3.13 Care homes with nursing and care homes including small care homes outside of the
City‟s boundaries attract an uplift of 3.5% on their base fee levels for new and
existing service users.
3.14 These proposals would be implemented from the 12th April 2004.
4. MATTERS FOR DECISION
That the Cabinet Member considers and approves the recommendations that base
fees for care homes and small care homes are uplifted by 3.5%, nursing homes
base fees are uplifted by £5%, and that the Q.A. Premium is increased from £12 to
£22 and the En – Suite Premium is increased from £12 to £14.
5. EVALUATION OF ALTERNATIVE OPTIONS
5.1 The options presented to homeowners were as follows: -
Option 1 –The additional £1 million to be invested evenly across all homes in
addition to the 3.5% increase in base fee levels. This option would have resulted in
an approximate fee increase of 5.7% for all placements. Officers were of the view
that Option 1 would fail to offer any reward for additional quality (QA systems and
en–suite facilities.) Some care homes with nursing homeowners had the view that
this option failed to take into account their nursing staff costs.
Option 2 – This option required the £1 million to be invested evenly across all
homes as a flat rate increase (£4 per person per week). In practice as there was
little difference between options 1 and 2 and this option received little support from
homeowners. Officers do not recommend this option.
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Option 3 – This option concerned the investment of the additional £1 million into the
nursing sector, which would have received a total uplift of 7%. All other fee
increases would be limited to 3.5% with no increase to the Q.A. and En–suite
Premiums. This option was supported by some care home with nursing owners but
not by the other homeowners. Officers were also of the view that other options
could be explored, which further rewarded homeowners in terms of the quality of
Option 4 – The additional £1 million to be invested entirely either on the Q.A. or the
En–suite Premiums which would give an extra £25 per person per week to those
homes which have a verified QA system which meets the Council‟s standards or
£11 per person per week increase to homes with en–suite facilities in single rooms.
This option was supported by homeowners who currently have the QA and En-suite
Premiums but rejected by those homes which do not have these Premiums.
Option 5 – This option is set out in the recommendations contained within this
report in paragraphs 3.10 – 3.14 inclusive. Officers recommend this option as a
workable compromise given the disparate views of the homeowners. It does
incorporate recognition of all the elements raised with Officers during the
consultation process. Option 5 can be viewed as the option presented to the
Directorate from homeowners themselves. Officers have undertaken detailed
modelling work to ensure that this option is affordable within the £1 million
additional resources accounting for the anticipated investment in Q.A. and en–suite
6. CABINET MEMBER CONSULTATION
Councillor Susanna McCorry, Cabinet Member for Social Care and Health
consulted during the preparation of this report.
7. WHAT CONSULTATION (if any) HAS TAKEN PLACE
Homeowners as stakeholders were consulted on all four options and were
requested to submit a fifth option.
8. WHAT REPRESENTATIONS (IF ANY) HAVE BEEN RECEIVED E.G. IN
RESPONSE TO THE INCLUSION OF THIS DECISION IN THE FORWARD PLAN
There have been no representations to the inclusion of this decision in the Forward
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9. LEGAL POWERS AND IMPLICATIONS FOR RESOURCES
(INCLUDE FINANCE, PEOPLE, PROPERTY AND IT CONSIDERATIONS)
9.1 The Council under the terms of the care home and care home with nursing
Contracts has an obligation to conduct a review of contract fees before the 1st April
in each relevant year.
9.2 The proposals outlined in this report can be contained within the overall budget for
2004/05 for independent sector Older People care homes and care homes with
nursing fees. The 2004/05 Budget for these fees was uplifted by 3.5% for inflation
and the specific proposals in relation to above inflation increases for nursing homes
and increases in premium allowances for QA and en–suite facilities add in total
around £1 million above inflation to fee levels for this sector. This is in line with the
Council‟s policy to increase the independent sector‟s fees over a five-year period to
stabilise the availability of provision and to improve the standard and quality of
accommodation available to Older People placed in the care homes and care
homes with nursing sector.
10. IMPLICATIONS FOR POLICY PRIORITIES
The implications for Corporate Policy Priorities are to assist in the development of a
safer and healthier City. The implications for Specific Service priorities will be to
assist in the improvement of services for Older People resident in care homes and
care homes with nursing.
11. ARE THE RECOMMENDATIONS IN THIS REPORT CONSISTENT WITH ANY
APPROVED "POLICY FRAMEWORK" PLAN OR STRATEGY/OR THE
The recommendations are consistent with the Council‟s longer term strategic aim of
investment within the independent care homes and care homes with nursing sector
to ensure the availability of nursing bed places to meet the needs of the people of
Birmingham. This strategy also incorporates the development in partnership of the
Council‟s Older People s Homes and in the meantime a continuing year on year
reduction in unit costs of the Council‟s own homes for Older People.
12. REASON FOR RECOMMENDATIONS
Approval from the Cabinet Member for Social Care and Health is required to grant
the percentage uplift and the proposals to invest the £1 million pounds over and
above inflation as outlined in this report.
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Report to Cabinet „Award of Contracts for the Provision of Care Home and Care
Home with Nursing Services for Older Adults 1st April 2003 – 31st March 2006‟
10th March 2003
Strategic Director of Social Care and Health
Assistant Director Finance
Tel: 303 2367
Fax: 303 4383
Acting Service Contracts Manager (Adults)
Tel: 303 4455
Fax: 303 4881
UPLIFT OF OLDER PEOPLE CARE HOMES AND CARE HOMES
My decision is to adopt the recommendation(s) set out in this
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