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Public funding for residential and nursing home care: projection of the potential impact of proposals to change the residential allowance in services for older people
Author(s) -
Clarkson Paul,
Hughes Jane,
Challis David
Publication year - 2003
Publication title -
international journal of geriatric psychiatry
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.28
H-Index - 129
eISSN - 1099-1166
pISSN - 0885-6230
DOI - 10.1002/gps.814
Subject(s) - allowance (engineering) , incentive , business , nursing homes , public economics , residential care , nursing , medicine , economics , operations management , microeconomics
Background This paper investigates the potential effects of a policy change in the funding of UK residential care. The White Paper Modernising Social Services (Cm 4169, 1998) outlined plans to change the distribution of the Residential Allowance (RA), payable in support of residents in independent residential or nursing home care, from a component of income support paid direct to establishments to a grant to local authorities. This change was intended to remove the perverse incentive in accessing independent residential care more favourably than local authority care. A further objective was to encourage local authorities to use the grant to support home‐based alternatives to residential care. The policy rests on a model in which price signals dictate the choice of care for an older person. By, in effect, raising the price of independent residential and nursing home care, the policy provides an incentive for authorities to seek alternatives to institutional care. Methods Managers from 16 UK social services departments attended a focus group discussion, completed questionnaires and provided information to assist in calculating the potential diversionary effect of the policy. Results Managerial estimates indicated a small diversionary effect of the policy; A potential effect of 0.26 and 0.19 per 1000 older people diverted from residential and nursing care respectively. Conclusions The study indicated that wider organisational factors other than price are likely to play a greater role in deciding whether an older person is admitted to care. Changes in public funding alone do not reflect the complexities involved in decision‐making concerning the residential placement of older people. Copyright © 2003 John Wiley & Sons, Ltd.