Outsourcing adult social care has contributed to England’s care crisis, argue researchers

'On average, for-profit care homes are worse quality and more selective than publicly-owned provision – and yet the for-profit sector has come to dominate the landscape in England's social care', says Benjamin Goodair from the Blavatnik School of Government's Government Outcomes Lab, lead author of the article, which is based on research funded by the Nuffield Foundation. 

Social care (sometimes referred to as community, residential, or personalised care) for older people and people with physical and mental disabilities is facing record demand in England, but is performing worse than any time in recent history, the Oxford University authors explain. 

Their research into the outsourcing of social care services tracks the levels of social care outsourcing in unprecedented granularity, revealing the near ending of publicly-owned residential care. In the UK, social care in Scotland, Wales and Northern Ireland is devolved, so they examined England data specifically. 

One contributor to this, they say, is the outsourcing of care provision from the public to the private sector. Figures suggest that the share of adult social care that is publicly provided has fallen from 42% to 9% since 2001. 

Although competition from private sector provision was championed as a solution to achieve cheaper and better-quality care, the authors point to evidence from the past few decades in the UK and elsewhere that challenges this view. 

For example, international evidence suggests quality differences are seen when private companies take over public services, suggesting that the same locations run by for-profit companies do worse. 

These quality differences are found in many countries and in many different measures of quality, such as lower staffing rates or forced closures of care homes (an action of last resort when residents’ safety is at risk), suggesting that the for-profit gap is robust to different measures of quality. 

Inequality has also been worsened as adult social care has turned to market-based and more self-funded provision, they add. Providers in England, for example, are increasingly focused on attracting affluent, self-funded social care users, who pay higher fees than the rates set for state-funded residents, leading to services becoming less accessible in the most deprived areas. 

One reason for the failure of privatisation is that when quality is hard to measure, as it is in the care sector, market-based provision is likely to incentivise cost cutting over quality improvements, they explain. 

Alongside a lack of regulatory powers by the Care Quality Commission (CQC), this means that profit-seeking remains largely unchecked, allowing companies to cut costs and quality in pursuit of financial gain. 

So, the authors ask, how can we ensure that England’s ageing population and population with disabilities can access safe, equitable, and effective care? Acknowledging that removing the profit incentive alone will not solve the challenges facing the sector, which has long grappled with chronic underfunding and staffing shortages, they suggest a partial solution is to control, restrict, or remove the profit motive in social care services, which would both improve the quality of provision and reduce inequalities across the system. 

They say this can be achieved by measures such as profit caps, limiting the payment of shareholder dividends, or attempting to align financial incentives with care quality through performance-related payments – but they acknowledge that these approaches face multiple challenges. 

Another option is bringing services back into public ownership or restricting all private ownership to third sector (non-profit) models, which could be 'the first step in taking back control and gradually moving towards a care system less driven by the profit motive,' they suggest. 

'Insufficient quality care can cause severe harm and distress for people who need it,' they write. 'Urgent steps to reduce the profit motive and reverse the outsourcing of services are essential to protect the growing population in need of care.'

'The new UK government will soon need to announce their plans for social care reform – it will be a major opportunity to address the issues related to for-profit outsourcing and curtail to profit-motive in the sector”, says Benjamin. “In the meantime, we can already see in the data some councils taking the issue into their own hands and starting to reverse this historic trend.'

The authors of the article are Benjamin Goodair from the Blavatnik School’s Government Outcomes Lab, Anders Bach-Mortensen from Roskilde University and the Blavatnik School’s Government Outcomes Lab, and Adrienne McManus and Michelle Degli Esposti from Oxford's Department of Social Policy and Intervention. 

Full article at the British Medical Journal: 'Analysis: How outsourcing has contributed to England’s social care crisis’ (DOI: 10.1136/bmj-2024-080380)

Last month the wider project team released an in-depth report on the outsourcing of social care in England.