Privatised care homes deliver a poorer service and poor value for money and should be replaced

Today we learned that more than half of the private care homes in Scotland have had complaints against them upheld. This is no surprise; the pattern of quality assessment on private care homes is consistently worse than for public provision, yet private care homes now dominate provision (“51 per cent of private care homes had a complaint upheld compared to 29 per cent of voluntary care homes and 19 per cent of publicly run ones”).

The number of residents in private sector care homes for older people has increased by two per cent (456) in the last decade compared to an estimated 33 per cent decrease (1,073) in the voluntary sector and 20 per cent decrease (812) in the public sector (source here). The result is the private sector now provides 79 per cent of the care home market compared to 74 per cent a decade ago

This is a problem because the UK Government estimates that about ten per cent of care home fees are extracted in profits. With Scotland spending more than £800m a year on private care home places, that is £80m lost from the system which could be much better spent.

All care homes are assessed for quality, but the care homes themselves do not like this data being made public. During Covid they lobbied against the public being allowed to know what their performance had been. This is understandable, because it isn't good. If you read the quality level descriptors you will realise that 'adequate' is barely scraping the minimum of what quality provision should be (it is defined as “strengths just outweigh weaknesses”).

Yet nearly one in three private care homes is rated as unsatisfactory, weak or adequate. That is considered high risk. Yet both not-for-profit and public provision is rated higher on average. There is a significant problem with the quality of care homes for the elderly.

In all of this it is important to remember that private care homes are often ultimately owned in tax havens and use a wide variety of tactics to transfer wealth to their parent company. One of the main ways to do this is to constantly 'flip' property. If you keep remortgaging your buildings and extracting the additional capital, you can charge higher and higher rent in the fees you charge. A lot of that comes out of the public purse. And you still own the building at the end of the contract.

But as a lucrative commercial industry, private care in Scotland has formidable lobbying capacity through Scottish Care – and it was revealed that it was these private companies rather than social workers, care professionals or local authorities who were the most frequent group in contact with then health minister Jeanne Freeman during the pandemic. They are insiders with significant influence. (As the STUC points out in the original article, the Scottish Government has falsely claimed “"there is no evidence that providing services through the public sector increases quality”.)

There is an easy way to deal with this. Contracts with care home operators are time-limited and the contract length is generally not long. At the end of an existing contract there is no compulsion to renew that contract. If public provision is planned over the long term it will become cheaper to deliver, the quality will be higher and the £80 million a year extracted by profit-making care homes will remain available for care.

Caring for the elderly should not be a means of tax-haven-registered companies extracting profit from public funding which is a taxpayer contribution to looking after some of the most vulnerable people in our society. Care should be not-for-profit.