How to solve the social care crisis | Dr Axel Kaehne

How to solve the social care crisis | Dr Axel Kaehne

How to solve the social care crisis
Dr Axel Kaehne Reader Health Services Research – Edge Hill University

Social care represents one of the most profound challenges to British society and politics. The sector is underfunded, suffers from low quality provision and poor monitoring arrangements. Because social care for the elderly is also part funded by the user, closing the funding gap often subjects individuals and their families to misery as they lose their assets or even their home. The recent aborted attempt to reform the social care funding crisis was another demonstration how toxic this issue is at the intersection of accrued entitlements, rules of eligibility and lack of resources.

Whilst the Prime Minister’s proposals were poorly thought through and badly articulated in public, not to mention its bad timing during a general election, I doubt that any other proposal bar a populist ‘everyone should receive everything’ would have fared any better in the public debate. So why is social care so difficult to reform? And what would a good proposal look like?

Social care suffers from a triple whammy. First, social care is usually underfunded due to deficit reduction measures. Second, its crisis reflects the considerable demographic changes of the population which are unlikely to abate in the near future. And, third, it operates within an entrenched care hierarchy, where the NHS is the main and primary recipient of government expenditure.

The demographic challenges alone are formidable. The population of the UK is growing older, and fast. As people enjoy higher life expectancy due to improved health care, their needs change from acute care to support for chronic illnesses, something that cannot be delivered in a hospital but should be done in the community and at home. This also means that the way in which care is delivered becomes fundamentally different. Despite a lot of talk about shared decision making, acute care in hospitals is dominated by professional expertise dispensed to passive patients. Social care however requires a high degree of self-management by the patient with significant levels of autonomy. Shared decision making is key to improving care quality where community nurses and carers cannot do anything without the participation of the patient.

The status of professionalism of nurses vis-a-vis patients is thus different from those of doctors to their patients. It makes social care a sector where recipients of care exercise a high level of autonomy and determine the nature and level of service demand. This personal autonomy and demand articulation is grounded in a sense of entitlement as people have paid into the system throughout their working lives. Yet it clashes with severe limitations of resources, and the need for eligibility criteria (administered through assessments) to ensure equity of provision across the care population.

In addition, social care in the UK suffers from low diffusion levels of technology. Whilst there are valuable technological innovations for home care, subsumed under the term telecare, social care providers are reluctant to implement changes to their practices. One reason is that care providers rely largely on poorly paid carers. This removes important incentives to innovate and rationalise provision. Low wages for carers thus impede innovation in the sector.

So what’s to be done? Any desire to reform the system needs to start with what is the root of the problem. The usual diagnosis is that the system is underfunded and that therefore austerity needs to stop. Whilst there is some truth in the argument that social care lacks sufficient resources at this point, throwing more money at a broken system won’t resolve the crisis. Essentially, the crisis in social care is a demand and a sustainability crisis. More money alone won’t solve this. Given the care hierarchy between NHS and social care in the UK, it is unlikely that NHS funding will be significantly reduced as social care expenditure goes up. A more probable scenario is that both sectors will grow considerably over the next decade.

The underfunding of social care is thus a question of how to open up new sources of funding on a sustainable footing. Since social care is embedded in the culture of accrued entitlements in the UK, it will be difficult to fundamentally alter the tax system or introduce new taxes. However, there is one area where people may feel motivated to make additional contributions: where their assets are concerned.

At the moment, since social care is part funded by care users, people with high care needs have to draw on the assets that they have built up over their life time. This includes their own home which they need to sell to cover care costs. This creates inequities in the system as the superrich can afford to pay for top quality care, whereas the middle classes often have to sell their homes and cannot pass anything on to their offspring. The poor contribute little yet take out a significant amount. The main losers are the middle classes as the main tax payers in the UK.

There is thus a clear incentive for the middle classes to pay into a social insurance over their lifetime to cover their part of the social care costs. If social insurance payments were subject to auto-enrolment (as is now the case for pensions in the UK), the system would gain a significant new funding source which would allow the sector to expand and increase wages. Increased wages would in turn unlock innovation as providers would seek to lower their costs in the long run by introducing technology into care provision in the home.

Introducing a social care insurance would also remove the current inequities within the system between those who can pay for their social care out of pocket and those who have to deplete their inheritance. Moreover, social care insurance would speak to the notion of solidarity which underpins the principle of risk sharing. Our NHS operates on the same basis, a social care insurance model for the self-funded part of our social care would put social care provision on a par with health care. It would provide a sustainable funding source and increase equity in provision. It is therefore a win win for everyone.


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