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Care home numbers fall ‘rapidly’ but new homes offering more places

Reported in Community Care (1 Sept 2017) : New care homes tend to be targeted at self-funders, affecting council-funded sector, warns Institute for Public Care

The number of care homes operating in England has fallen “rapidly” since 2012, but new homes opening are offering more places than those closing, research has found. The Institute for Public Care found new homes registering with the Care Quality Commission tended to be large new builds targeted at self-funders.

Using data from the CQC, it found that the average size of a home opening was 37 beds, while the average size of one closing was 29 beds. The report, which analysed the care home market before and after the introduction of the Care Act 2014, said that self-funders tend to pay higher care fees than council-funded residents even when living in the same home. This price difference has been referred to as a “cross-subsidy”, with the assumption that the rates paid by councils impact on those for self-funders.

If fewer self-funders live in homes that support both types of client, then this affects the balance of “cross-subsidy”, therefore placing providers at greater risk of financial difficulty. The report added that “some care homes will see fewer self-funders and higher staff costs due to increases in the National Living Wage, and there is a danger that if providers cut back on other costs, such as maintenance, then the home looks shabbier, self-funder numbers decline even more, leading to a spiral of decline.” It echoes the findings of a recent study by the Competition and Markets Authority, which found that little expansion of the market is focused on council-funded clients.

The IPC, based at Oxford Brookes University, also found that the total number of care home beds specifically for older people had increased by 4.3%, from 387,485 in April 2012 to 404,163 in April 2017. Over the same period, the report claimed, the potential demand for beds for older people increased by much more – the number of people aged 85 and over rose by 16%.

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