Care News - Winter 2022

Welcome

Welcome to the Winter 2022 edition of the Care Newsletter, and as we reach the end of a year which none of us will ever forget we look towards 2023 with a different Prime Minister and a different Monarch. Most of us have never known a different Monarch (although the people we support may have), but we must hope that King Charles III will rule with the same grace, humility and dedication as Queen Elizabeth II.

In October many members of the care sector headed to the NEC in Birmingham for the annual Care Show. Many of the presentations over the two days were concerned with the future, on such topics as intergenerational care, technology, interior design, the workforce, and the new CQC Framework. We were delighted to see Denizns, who contributed an article to our Autumn newsletter, at the show; and also Cahoot Marketing, whose thoughts on rethinking your marketing strategy are included in this edition.

Michelle Ferris Partner, Head of Charities and Care, Albert Goodman

ANNUAL INVESTMENT ALLOWANCE

Thinking

of investing in some new equipment

for your care business? Andrew Law, Senior Manager, Tax Consulting at Albert Goodman, explains how this can be doubly beneficial by utilising the Annual Investment Allowance.

Any business needs to invest in the equipment required to carry on its trade. That might be as simple as a laptop or as significant as a processing plant, and it varies from business to business. Whatever the scale of business the annual investment allowance (AIA) provides a significant tax incentive to invest in your business.

WHAT IS THE AIA?

As a general principal capital expenditure is not allowed as a deduction from the profits of the business for tax purposes. Instead, tax relief is given as a ‘capital allowance’ and the rate of that allowance depends on the type of asset you invest in. ‘Plant and machinery’ is the main category and includes all the furniture and equipment you need to run your business. It does not include buildings which have a different allowance (structures and building allowances) but it can include some of the things fitted to a building like heating and ventilation systems.

The AIA provides that the first £1 million p.a. of expenditure on plant and machinery will qualify for a 100% tax deduction, so the whole cost is allowed against profits in the year the expenditure is incurred.

WHAT IS NOT INCLUDED?

Some assets are excluded from AIA and we have already mentioned buildings. The most common which clearly comes under the heading of ‘machinery’ will be cars. AIAs can never be claimed on the purchase of a car, and instead

the special rules for cars applies. Some electric cars can attract a different 100% allowance, known as a first year allowance, but that is outside of the AIA.

WHAT IF I HAVE SEVERAL BUSINESSES?

Where there are several businesses which are under common control, they share a single AIA but they are free to split it between them as they see fit. So, a group of companies will only be able to claim AIA on the first £1 million of capital expenditure across the group as a whole.

WHEN DOES THE ALLOWANCE END?

The previous legislation said that the AIA would reduce to £200,000 with effect from April 2023. The mini budget extended the £1 million limit indefinitely, and this was confirmed as part of the Autumn Statement in November. The legislation for this is expected to be passed shortly.

WHAT DO I NEED TO DO?

Most businesses will find £1 million capital expenditure to be more than enough to meet their needs but it is worth ensuring the expenditure is timed to obtain the relief as early as possible. It is worth reviewing your capital expenditure budget to maximise the relief available.

The Future of Care

Independent Care Sector Mortgage Broker Mark Hickman, Director at Chandler&Co, offers his insights for the year ahead.

The year 2022 has certainly seen its share of economic and geopolitical pressures, but one enduring fact is that we have a rapidly ageing population with increasing age-related complexities, which needs the support of a sustainable social care sector working alongside the NHS.

THE STATE OF CARE REPORT

The latest announcement from the Care Quality Commission regulator stated that, ‘in 2022 the health and care system is gridlocked, unable to operate effectively’ and, ‘that too often people just can’t access the care they need.’ With increasing hospital bed blocking from elderly patients seeking care at discharge, the demand for care home or care at home provision continues to escalate, adding weight to the demand for a viable and sustainable social care sector.

INDUSTRY CHALLENGES

At the time of writing industry challenges continue within the social care sector, with the much-publicised staff and recruitment challenges, the cost-of-living crisis and the continued funding and ‘who should pay for care’ debate. Spearheaded by Care England and the wider care network and associations, the Government is being challenged to put social care on a level footing with the NHS to better reward those that work in this extremely rewarding and valuable sector. There is no doubt that to prevent increased polarisation between those who can afford to pay for their care and those with limited means who require support from their Local Authorities, all providers and their employees need to have the recognition and funding that they deserve.

It is vital that the care sector has a sustainable financial foundation as it moves into 2023. The importance of real time financial management accounts and forecasting cannot be overestimated, providing insight into periods of gap funding, supporting business growth (whether this is for the first-time care home buyer or a multi-site provider), and delivering on the care provision’s mission and vision.

With sustainable funding, care provision can move forward to tackle the challenges facing the sector. People who use care services want consistency in their care, which funding reform can assist with if the true cost of care is acknowledged. Planned workforce strategies are becoming the norm, with providers seeking to diversify their staffing. They are also reacting to the possibility of a higher minimum wage moving towards the living wage by using fee uplifts for the self-funding sector, in addition to third party top-ups to the Local Authority rates. The questions around what the true cap on care costs means remain, as does the uncertainty surrounding whether it will be reformed again under the Prime Minister in 2023.

FUNDING AND INTEREST RATES

Throughout 2022 we have seen a gradual increase in the cost of debt which is used to fund many care home operators with current and long-term liquidity requirements. As a result, whether care providers are new to the sector or developing their business, considering funding options will be key to their viability and sustainability alongside reviews of service user pricing strategy.

At the time of writing the market uncertainty remains. However, the interest rate outlook has lowered from its previous peak, with lenders continuing to monitor the interest rate market closely.

THE PATH TO NET ZERO COMBATING THE ENERGY CHALLENGES

With COP27 being very fresh in minds, and care home businesses seeking to mitigate the rise in energy costs, the sector can expect increased interest in green refurbishments, care home extensions and new builds. The Corporate care home sector tends to lead the way in this regard, however, as the independent care home sector plans for 2023 we can expect increased demand for lending criteria for a greener care home environment.

For an in depth look at ‘green’ issues see our Summer 2021 issue

CARE SECTOR INNOVATION

Care sector innovation accelerated during the pandemic and has continued. As regulators across the UK step up their digital processes with the evolution of Integrated Care Systems we have seen a higher take-up of digital care planning and digital business operations.

COMPLIANCE

Regulation continues to evolve across the UK. As an example, the Care Quality Commission’s ‘Single Assessment Framework in 2023’ will have a bearing on the care sector’s post pandemic accelerated innovation, as it addresses real time data collection and feedback seeking an enhanced personal care service. As care sector technology and innovation increase so too will healthcare preventative measures, enhancing the role of the social care sector and reducing the strain on the NHS. Provider strategies will continue to pivot towards best practice outcomes, enhancing the personal care service. Carrying out bespoke care service surveys and updating continuous improvement plans will gain increasing importance under the new regulation, evidencing the standards that a care provision is attaining or aiming to attain.

Carl May-Smith talks in detail about CQC’s new framework elsewhere in this issue and in our Autumn 2022 edition

CARE SECTOR SUSTAINABILITY

In conclusion, the resilience of the care sector continues despite the challenges it faces. Some care homes will reconfigure into supported living, whilst others will continue to seek growth and expand through extensions or acquisition.

Funding can be addressed organically, for example through retained profits from successful business operations alongside lender finance. Identifying how finance can add value to a care home or wider provision forms part of the business’ forecasting and business planning, working alongside care sector experts to ensure the long-term viability of the care sector.

For more care home and wider care sector financing tips visit chandlerandco.co.uk, independent specialist care sector brokers or call 01622 817484

HAVING TROUBLE RECRUITING?

Time to rethink your marketing strategy

Your team is your greatest asset when it comes to providing outstanding levels of care, but high staff turnover, tighter immigration rules, and the fallout from the pandemic mean many care providers are struggling to recruit and retain the right staff. Alfie Jones, Director of Cahoot Marketing, explains some of the things care providers can do to attract staff.

When you’re planning your team’s rota, the last thing you need is staff shortages, gaps when people are off sick and carers travelling miles between visits. But being trapped in an endless cycle of recruiting staff who don’t stick around is a headache too, and a distraction from your overall mission: caring for your clients. So, what can you do?

Challenge preconceptions

There are lots of myths and preconceptions about the care industry. Many applicants expect gruelling hours in exchange for low pay and poor working conditions, but that couldn’t be further from the truth. While providing care for someone can be challenging, it’s also hugely rewarding, skilled work with opportunities for career progression.

This is where marketing comes in. At Cahoot Care Marketing, we don’t just handle marketing on behalf of clients. We teach them to build marketing into everything they do – while a client telling their carer how much they mean to them is rewarding, asking them to write an online review lets everyone know that your carers change lives.

Strengthen your brand

To attract the best candidates, you need to sell your company to them. Show them what they’ll get in exchange for working for you. Writing a great job ad and posting it on the most relevant channel for your target audience is a good start, but the first place they’ll look to find out more is your website.

Websites should be friendly, informative, and easy to navigate. Videos are a great way of giving candidates insight into what life is like at your company from the people who work there. Think about client and carer testimonials.

What employees want above all is to be treated with respect. That means strong management and training that goes beyond ticking a box. Show that you care about their career goals and prioritise helping people feel confident and happy at work.

A helping hand

If you want to learn more about care marketing and how we can help you recruit the best talent, email hello@cahootmarketing.com. Our tried and tested methods get results, and we have the data to prove it.

THE LIBERTY PROTECTION SAFEGUARDS: how will they affect my residents?

The introduction of the Liberty Protection Safeguards will be of paramount importance to care home owners and their staff alike, replacing the Deprivation of Liberty Safeguards to ensure that people who must be deprived of their liberty to receive care or treatment as a result of their condition remain the principal in the decisions surrounding their deprivation of liberty. James Howell,

Director of Rubric Law, explains what it means for residents and care providers.

THE NEW ASSESSMENTS

The Liberty Protection Safeguards will only apply to people that satisfy a three-stage assessment process. This includes a Capacity Assessment, a Medical Assessment and a “Necessary and Proportionate” Assessment.

The Capacity Assessment simply determines the resident’s capacity to make their own decisions in regard to their care and wellbeing.

The Medical Assessment will determine the severity of a person’s mental disorder.

The “Necessary and Proportionate” Assessment determines whether the deprivation of their liberty is necessary to prevent harm to them, and if the deprivation will reduce the likelihood and seriousness of any harm that would come about had they not been deprived of their liberty.

Although this all sounds like a long and taxing process, most care homes will already hold this kind of information on their residents, so the process should be much quicker than that of the previous safeguards.

THE BENEFITS

The family and/or close friends of the resident will now be much more involved in the process. There is now an explicit duty to consult the carers of the resident as to the resident’s welfare. There will also be greater

opportunity to express any concerns regarding the resident’s best interests or the treatment of the resident.

When determining a resident’s place of care or treatment, it is now a requirement that an approved mental capacity professional will consult the resident and/or anyone interested in the resident’s welfare before determining their place of residence and care. This results in the approach being personalised to the resident’s needs, meaning they will always be in the right hands.

The scheme is now extended to include 16 and 17 year olds, meaning that a court order is no longer required to make a decision on deprivation of a person’s liberty at these ages.

ample advice is given to aid in the mitigation of liability and work to establish the framework to prevent any breaches of procedure that would contravene the regulations in the first place.

Previously these safeguards were planned to come into force by April 2022 but this has since been delayed, with no indication of when they are to be fully implemented by the Government. Despite this, they are certainly going to be implemented soon, so pre-empting their arrival and establishing a solid plan to ensure the regulations are complied with prior to their implementation will only make the transition that much smoother!

HOW CAN A LAW FIRM HELP?

As there are many notable differences between the Liberty Protection Safeguards and the Deprivation of Liberty Safeguards, we can only anticipate that there will be an adjustment period in which employees of care homes will need to adapt to the new safeguards and their requirements.

As a law firm, we can draft procedure plans to ensure that these safeguards are followed closely, avoiding any potential liability as a result of missing steps which may occur due to old habits from the previous safeguards.

We will be on hand to ensure that

We specialise in helping clients buy or sell care homes, but we also support you through corporate, commercial, property and employment matters. Call us on 0117 435 4350 or email us at info@rubric.law to see how we can help you.

JAMES HOWELL Managing Director of Rubric Law

Managing

CQC Trends and social care funding – a Legal Perspective

In our Autumn 2022 Newsletter Carl May-Smith, Partner at Browne Jacobson, gave his analysis of trends in Care Quality Commission inspections and his thoughts on its new Framework, due to be introduced in January 2023. Here he shares his thoughts on CQC prosecutions and social care funding.

CQC PROSECUTIONS

Although anecdotal, it appears to us that there is a further increase in CQC prosecution activity. Many of the prosecutions in 2021 and 2022 have focused on NHS Trusts, but it is inevitable that any such trend will also affect independent providers.

One factor that may be driving an increase in criminal investigations is an apparent focus on inquest outcomes. Providers should be prepared to face an investigation where a coroner finds that neglect played a part in a death or where a report to prevent further deaths is issued.

Fines for these offences are increasing too. Two NHS Trusts have recently been fined £1.3m, in relation to two patient deaths, and £700,000, in relation to one death, respectively. These fines took account of the fines reduction of up to 50% available to public bodies. In June 2022 an independent care home provider was fined £1.5m following a CQC prosecution relating to a resident’s death in May 2018.

Providers and investors also need to be aware of how long CQC criminal investigations go on. It remains the case that the vast majority, if not all, CQC prosecution decisions are made nearly three years after the events they relate to. In our experience there are often long periods during investigations, sometimes well over a year, where providers hear nothing and may assume that the risk of prosecution has gone away.

SOCIAL CARE FUNDING REFORMS

Away from the CQC, another key development coming in 2023 are social care funding reforms. The greatest impact is likely to be seen in the care home sector and I wanted to highlight one element for providers of such services – the ‘fair cost of care’ reforms.

The Government has promised that, from October 2023, there will be an end to the cross-subsidisation of local authority funded care home places by the charging of much higher rates by self-funding residents. In doing so they have acknowledged what many providers have said for years, which is that local authority rates are often below the real cost of providing care.

The Government intend to achieve this by allowing self-funding care home residents to arrange their care through their local authority, and therefore at the lower rate. The intention behind the reforms is to see everyone paying an even rate for the same care home, sitting somewhere between the current local authority rate and the current self-funded rate.

We will need to wait to see the approach taken by the new Government to these reforms, after the previous

incumbents scrapped the national insurance increase intended to fund it. The new Prime Minister has placed great emphasis on the NHS. However, as speculation grows about a possible return to austerity politics, it will reassure some to know that the new Chancellor has previously identified the failure to protect social care services as a key mistake of previous, similar policies.

OTHER THINGS TO TALK TO US ABOUT

Other developments to be aware of in 2022 and 2023 include mental health reforms, which may see a push for increased community provision for learning disability and autism, the initial stages of Integrated Care Systems and the much-delayed Liberty Protection Safeguards. Feel free to get in touch to discuss these or any other health and care issues with us.

Carl May-Smith is a partner and barrister specialising in regulatory and criminal law with a particular focus on the health and care sector. Carl provides a broad variety of advice including in respect of health and care standards (CQC and others), health & safety, fire safety, financial regulation and environmental law. His clients include care providers (independent and NHS) as well as investors, businesses and public bodies across a range of sectors.

For investors, Carl provides specialist regulatory due diligence advice most frequently in respect of health and care sector acquisitions. He provides proactive advice and training on topics such as CQC registration and entering the UK healthcare market as well as litigation services, such as defending regulatory enforcement actions or challenging CQC inspection reports. He regularly appears before the criminal courts and tribunals.

AUTUMN STATEMENT – Care Cap delayed

Since Mark Hickman and Carl May-Smith wrote the articles contained in this newsletter, Chancellor Jeremy Hunt has announced a delay to a cap on care costs in England. The cap, which would have ensured that people paid no more than £86,000 towards their personal care during their lifetime, had been due to come into effect in October 2023. It has now been delayed for two years, leading Age UK to say that this “raises serious questions over whether it will ever be introduced at all”.

Health Secretary Steve Barclay said the delay was a “difficult decision” but the Government was committed to the reforms. He said there would be £2.8bn of funding for social care over the next year and £4.7bn the year after, allowing 200,000 more care packages to be delivered. This in turn would reduce the pressure on the NHS, as often people who are well enough to leave hospital are not able to be discharged because of a lack of support or care home places in the community.

CQC’S NEW INSPECTION FRAMEWORK AND THE ROLE OF TECHNOLOGY

In our Autumn 2022 Newsletter Carl May-Smith, partner and barrister at Browne Jacobson, outlined what the CQC’s new Inspection Framework was likely to look like. He noted the utilisation of additional sources of information particularly in relation to feedback; and the use of internal CQC ‘dynamic dashboards’ to inform regulatory action. The use of digital technology will be vital in preparing care providers for these changes, as Senior Social Care Professional Rob Hammond, an Advisory Board Member to PredicAire, explains.

Technology and its application to the care sector has been a key theme at industry conferences during 2022, notably the Care England ‘Facing the Future’ event in March and the Care Show at the NEC in October. Introducing and increasing the use of technology in care homes is high on the Government’s agenda, with £150m of funding to drive digitalisation announced as part of the White Paper in December 2021.

In the future CQC intends to assess processes, policies and procedures through remote collection of information, with a much greater emphasis given to outcomes. There can be little doubt, therefore, that care providers who are able to supply accurate and relevant data to CQC in a timely manner (often at the touch of a button) will be in a much stronger position in the future than those who continue to rely on paper-based record keeping. Technology allows providers and registered managers oversight of multiple residents’ care and support in key risk areas at the same time through the ‘dashboard’ feature which appears in many care management software (CMS) packages, allowing trends and/or areas of concern to be quickly identified and proactively addressed before they become a significant issue.

In his article, Carl May-Smith commented that ‘choice, control and personalisation are said to be a golden thread throughout the new approach’, and new technology is allowing access on a different level to achieve this. Previously, access to an individual’s care plan for a resident, family or a representative was by appointment only, and during the pandemic this became even more difficult and challenging. But the most advanced CMS packages now include apps for family and/or representatives, as well as the resident themselves, meaning that a resident and their representatives can drive how they wish to be cared for to a level not seen before. This gives the resident and their representatives real ownership, oversight, and involvement in how they are cared for. It also allows providers to look beyond purely clinical outcomes, to monitor other areas of the care service. This could include using accumulated data and the care team’s practice in involving a resident in their care, to assess wellbeing. Beyond the care plan, technological advances allow families access to their loved one’s care in a live context, formalising a previously informal monitoring role. Although the detail of CQC’s framework has yet to be announced, those providers using technology such as that described above can be confident that they are ‘ahead of the game’ in preparing for what is to come.

NEWS FROM ALBERT GOODMAN

AS WE LOOK TOWARDS 2023, WE’D LIKE TO SHARE SOME OF OUR 2022 SUCCESSES WITH YOU

Employer accolade

We are delighted to share the news that, during May, Albert Goodman was revealed to be the best accountancy firm to work for in the UK. The announcement was made by TV and sports presenter Dan Walker during the Best Companies live event.

The Best Companies list has recognised Albert Goodman as a leader in the field of accountancy determined through a firm-wide survey assessed and ranked in eight categories, including personal growth, wellbeing and teamwork. Albert Goodman also retained their 2-star accreditation as an outstanding place to work and proudly featured as the 17th best firm to work for in the South-West, moving up 18 positions from their 2021 ranking.

Albert Goodman joins ‘RISE’ Initiative

In July it was announced that Albert Goodman was one of 16 companies which have joined the Rise Initiative, launched in December 2021 to teach life skills to young people from low socioeconomic backgrounds. Accountancy firms ICAEW, EY, KPMG, PwC, BDO and Grant Thornton launched Rise

with the aim and determination to teach life skills including communication, problem-solving and teamwork skills, and we are delighted to support them in their efforts.

Sharon Spice, Director, Global Marketing, Brand and Belonging, ICAEW, says the contribution of new partners such as Albert Goodman to the Rise programme will make a real difference to young people, especially those who have had to play ‘catch up’ on their studies after their education was impacted by the pandemic.

Albert Goodman working towards B Corp Certification

In September it was announced that Albert Goodman has completed the first stage to becoming B Corp Certified, having successfully submitted and passed the B Impact Assessment.

The B Corp community is a community of leaders, driving a global movement of people who continually strive to do things better for its team, the planet and the people within it. Albert Goodman is proud to start the process in joining this prestigious community

For the latest news from Albert Goodman, visit www.albertgoodman.co.uk/insights

As we reach the end of another eventful year, the sector can only hope that our new Prime Minister Rishi Sunak makes good on his stated intention to ‘deliver’ the Conservative manifesto promises from 2019, including the pledge to ‘fix social care’ once and for all. Changes are coming, not least to regulation, but what does not change is the need to support vulnerable people in care facilities and in the community. We hope that the articles in this Newsletter are of use to you and your care business, and wish you a Happy Christmas and a prosperous New Year.

Michelle Ferris

Head of Charities and Care, Albert Goodman