The Care Collapse: The Imminent Crisis In Residential Care

The interim report of think-tank ResPublica was widely covered in the press last week. ResPublica (in partnership with Four Seasons Health Care, HC-One, and GMB) has undertaken research assessing the state of the residential care industry, including an analysis of its future financial viability. This will inform a full report, to be published in the New Year, setting out our broader vision of the future of care providers: acting as the ‘agents of integration’ in a more joined-up health and social care system.

ResPublica says that they do not believe it is an understatement to say that Britain’s residential care sector is in crisis. Providers are being faced with an unsustainable combination of declining real terms funding, rising demand for their services, and increasing financial liabilities. The research projects a funding gap of over £1 billion for older people’s residential care alone by 2020/21, which could result in the loss of around 37,000 beds. This is greater in scale than the collapse of Southern Cross in 2011, which affected 31,000 older people.

This report however highlights a concern that the question of the operational viability of the residential care sector threatens the extent to which such integration can be achieved. Addressing the funding crisis in the residential care sector is therefore of paramount importance to ensure good population wellbeing both today and in the future.

In a detailed analysis authors outline a number of other significant factors in this crisis including:

• An Ageing Population: Over 65s make up about 18% of the population. This is set to rise to 25% by 2050. Nearly 10% of the population is over 75 years old.
• Acute Conditions: 70% of the total health and care spend, in England, is on long term conditions meaning 30% of the population accounts for 70% of the spend.
• Spending Cuts: 90% of local authorities now only provide funding for older people with ‘substantial’ or ‘critical’ needs. The result of this has been that the number of over 65s getting public money for social care has fallen by 27%.