Counting the Cost of Choice and Control: Evidence for the costs of self-directed support in Scotland

3 FINDINGS 1 - LOCAL AUTHORITY/SERVICE COMMISSIONER PERSPECTIVES

Introduction

3.1 In this chapter we present findings concerned with the costs of SDS for Local Authorities in their role as commissioners of social care services, which we used for predicting and modelling the costs of changes to SDS from 'standard' care. The evidence from this chapter is drawn from the individual interviews with commissioners and managers in the Local Authorities, interviews with workers in support and advocacy organisations, views from the reference group and the participants in the workshop discussions.

Variation

3.2 We found wide variation in the kinds of structures, systems, criteria and expectations concerning SDS across the three Local Authorities participating in this study. Although all three authorities had a relatively long history of offering DPs to service users, there was considerable variation in the criteria for accessing services, the kinds of assessment systems in place, and the types of services that users could use their DPs to purchase. This variation was also found in other Local Authorities.

3.3 Local Authorities A and C had large numbers of DP users who were younger disabled people or people with learning disabilities, and few frail older people on DPs. In contrast, over half of Local Authority B's DP users were frail older people.

3.4 In all 3 Local Authorities there was also wide variation in the assessments and records kept between different user groups (with learning disabilities the group likely to have the most standardised criteria for accessing services and DPs across Local Authorities), and between DP users and those receiving 'standard' services.

3.5 Systems for keeping records and allocating unit costs for individual packages of care were much more developed for DP users, with individual service users having to provide often quite detailed accounts of expenditure on different services. Bespoke service systems and, in some cases, distinctive support structures created specifically to enable the use of DPs meant that robust ways of costing services had been identified. These methods varied: sometimes services were costed by hour, sometimes by service input, sometimes on a block or individual contractual basis.

3.6 However, identifying the costs of services to individual service users who were not using DPs was far more problematic, even though, in all three Local Authorities, these remained by far the majority of service users. Unit costs for some types of service (e.g. home care and residential care) were relatively easily available, but for others (e.g. daycare) this was more difficult. Local Authority B in particular envisaged that unit costs for daycare would increase significantly if more users switched to DPs and withdrew from using the service: concerns regarding the longer-term service viability led to daycare services not being included in DP packages whilst that situation was being assessed.

3.7 Accessing individual-level data was difficult: often the information was held over several different, often incompatible, systems. Local Authority A in particular noted that it was often easier to see where money had come from (e.g. Independent Living Fund, NHS etc) than to track where it went. There was not necessarily any easy way to link up assessments of needs and the costs of directly provided services, and identifying the 'matched sample' of service users was difficult across all three Local Authorities. Moreover, it was often difficult to access information for service users with longer-standing care packages.

3.8 There was also considerable variation in how the unit costs of packages that were available to DP users were calculated over time. One informant in Local Authority C explained:

[To calculate the costs for SDS users] we are using equivalency at the moment - we are basically just saying whatever it costs now for the service they are getting is the funds we are making available to them on an SDS package....if they are employing their own staff we have a rate that we use for that and we would give it based on whatever the current cost was. If they are using an agency just now, we would give them whatever the agency cost. If they are attending a day centre, we will given whatever the day centre cost. We have a unit cost for home care, we have a daily cost for all day care resources and we know how much respite costs so that pretty much covers it.[However] that will definitely change. We are in the very early stages of starting to look at how to get to a resource allocation system....it is just an indicative amount...it is an exercise fraught with difficulty. (Interview, Local Authority direct payments team manager, LA C).

3.9 It is interesting to note that costs for DP users are therefore likely to be far more transparent than for non-DP users. If more users switch to DP-type schemes, it will therefore become much easier to track the relationship between the type and cost of individual services and support. This can make the direct impact of a reduction in, or change in the distribution of, available resources more transparent to users. For example in the case below where the method of support agency funding changed, with DP users able to both see the amount of their DP allocated to support services and to choose where to spend it as a result:

Last year the direct payment rate was £12.20 an hour and the council funded us to provide the employer, admin and payroll support to folk….. We had a complete change, the hourly rate was reduced to £11.50 to the clients....we are now selling our services to individual clients. (Interview, direct payments agency support and advice agency, LA B).

3.10 As Local Authorities develop resource allocation systems⁴ that enable the tracking of costs of services at an individual level, it should become easier to identify discrepancies in resource allocation across different user groups and across different individual users. Several commentators therefore expressed the concern that different user groups who might have been relatively generously served might lose out under SDS developments, and Local Authorities will face a significant challenge in managing this change fairly. In terms of how this relates to our cost predictions and modelling, it is likely that increased transparency in costings will reduce variations, enabling simpler and more effective administrative systems. This may well reduce the organisational costs associated with changing systems in the longer term.

History, structures and responsiveness

3.11 There was a concern across Local Authorities that a shift to more variation in different types of SDS would introduce significant costs because of the risks and costs associated with destabilising existing providers. One informant explained:

We are having quite a difficult time for service providers actually because they get a contract for two years so you know where you are with that, but if, during those years you might lose half your contract, that could be quite worrying. (Interview, Local Authority direct payments team manager, LA C)

3.12 History and structures played a significant role in how responsive commissioning arrangements could be to the needs of SDS users. Service level agreements with key providers were usually contracted on the basis of long-standing relationships based on trust and on evidence about the quality of provision. Similarly, prices and contracts for standard services were usually negotiated on a clear indication of the relatively predictable level of demand, based on past volume. If unpredictable numbers of SDS users were to renegotiate contracts on an individual basis at short notice, for example due to change in provider status or ownership or adverse publicity, there was some doubt as to whether commissioning arrangements would be sufficiently robust to cope with the need to be responsive to users' needs.

I would think service providers would be a bit anxious that they could set up a whole approved package of support for someone and then six weeks later they say, no I do not like you and I do not want you anymore (Interview, Local Authority direct payments team manager, LA C)

3.13 Support agencies also pointed out the possible need for fair 'notice periods' to be built into contracts so that SDS users could not abruptly cease using a service:

You do not know how the future is going to be. We have four weeks' notice on either side, but it may be that we have to put something about if you wish to no longer use our services you will need to give x months notice. It is difficult because they have only got a limited pot of money as well (Interview 2, Local Authority B Direct payments agency)

3.14 There was a concern that moving away from historically tried and tested methods of commissioning would place an administrative burden on Local Authorities, who may have to bear the costs of ensuring that individual SDS users pay invoices promptly. All three Local Authorities had relatively high numbers of DP users who directly employed their own PAs and were therefore experienced in dealing with payroll, invoices and other administrative details. Systems had been developed to ensure that users were given enough information and support to manage their funds appropriately, and support organisations had built up a history of knowledge and good working relationships with both users and providers. It was felt that these systems and organisations could come under threat if high numbers of new users wanted to opt in and out of services quickly, although our data also suggests that users prefer to remain with reliable providers rather than make many changes which may threaten the continuity of the support they receive.

Quality and cost

3.15 The relative strength that Local Authorities have, as large scale organisations, in the commissioning process has an impact on the kinds of service contracts they are able to negotiate with providers. It gives them a particularly strong lever to direct the quality of care that individual contractors may not have.

Obviously all service providers are required to register with the Care Commission so the quality of the care should be up to a certain level of standard, but we currently have issues with direct payment recipients who are pretty much seen by the service providers as self-funders and so restrictions in relation to charges rates they charge do not apply. There is no protection at the moment for service users in relation to that. (Interview, Local Authority direct payments team manager, LA C)

3.16 Nevertheless respondents across all three Local Authorities pointed out that the flexibility of SDS, coupled with the amount of control exercised by users, enabled users to quickly change providers when they were unhappy with the quality of the service being offered, if alternative providers were available. Where providers are forced to respond quickly to users' needs in this way, the likelihood of Local Authorities being locked into large scale contracts with poor quality providers may be reduced. By shopping around between providers, SDS users may well be in a position to improve the quality of care provision more quickly and cost-effectively than using the Care Commission and inspections.

Local Authorities as care commissioners

3.17 Under SDS Local Authorities will still have an important role to play in assessing the needs of potential SDS users, enabling them to put together packages of care (and as the guidance makes clear, they may well retain involvement in directly providing or commissioning services on behalf of users for a significant proportion of their users). The views of respondents varied significantly as to their perceptions of the impact that the move to SDS would have on these costs. Local Authority C found that it took significantly longer for social workers to carry out assessments for DPs than for directly provided services - they estimated twice as long. However, Local Authorities A and B asserted that the level of assessment, monitoring and review needed for DPs was not significantly greater than that needed for traditional care management.

3.18 Moreover, as systems for assessment and monitoring of SDS become more streamlined and simpler to use, respondents envisaged a reduced role for social workers as more like 'care brokers' for the majority of service users. Whilst they saw a continuing important role in safeguarding vulnerable adults, many Local Authority respondents were hopeful that SDS would enable a greater share of the responsibility for monitoring and review to be held by users rather than the Local Authority. In time this might make the reinvestment of resources from assessment and care management to frontline services possible, which would increase the volume of resources available to SDS users. The anticipated savings from the reduced role that Local Authorities would play as care commissioners would also offset the costs associated with moving to new governance and organisational systems resulting from SDS.

I do think that if self-directed support is implemented in its purest sense and we are empowering individuals to the extent that the Bill suggests that you should be doing, then the responsibility will move to the service user. (Interview, Local Authority direct payments team manager, Local Authority C)

3.19 However, respondents were keen to point out that any such savings might well take a long time to materialise. Support agencies also pointed out that the need for sufficiently resourced support would continue and probably increase under SDS, as the possible multiplicity of options and providers could prove challenging for users to negotiate. The need for clear, transparent and fair systems for both costing and managing SDS was stressed: costs were estimated to be significantly increased by the complexity and fragmented nature of the present system.

Summary

3.20 The findings from this chapter are;

• We found considerable variation in the management systems concerning SDS across the three Local Authorities. Simplifying the management systems associated with SDS, particularly reducing the variations in the way information is kept across systems, user groups and accounting procedures in different Local Authorities, could significantly reduce the costs of SDS;
• Respondents suggested that costs for users with DPs were likely to be more transparent than costs for those receiving standard services. Improved transparency in costing might improve efficiency and equity across different geographical areas and different user groups;
• Providers may be at risk of bearing the costs of SDS users changing service with little notice, although we do not know how likely or prevalent this will be;
• SDS users may be in a relatively weak position to directly negotiate the costs and quality of service provided;
• However, SDS users may be a relatively strong position to elicit improvements in quality by withdrawing from poor quality providers;
• A gradual reduction of the monitoring role played by Local Authorities (as is recommended in the guidance for the forthcoming legislation) as SDS users take on more responsibility may, in the long-term, produce some cost savings that could be reinvested in services.