Assessment of current sustainablility of the care home market for people over 65

There are several factors that continue to have an impact on the delivery of care in the older people’s residential care market in Brighton & Hove. Some factors are in line with national and regional comparison, others are specific to Brighton & Hove. Together they pose significant difficulties for providers and commissioners. 

The current care home market in Brighton & Hove is explained as:

  • a strong residential care offer, but with gaps in specific areas 
  • a shortage of high frailty and nursing care 
  • a severe shortage of residential and nursing dementia beds, alongside functional mental health, which has resulted in large numbers of people being placed out of the city
  • a shortage of long-term planned respite care
  • a shortage of specialist care for people under 65 
  • severe financial pressures for both Brighton & Hove City Council and independent providers
  • a care workforce shortage

Care home beds in Brighton & Hove in March 2023

There were a total of 2005 care home beds available in March 2023.  

Care home type


Percentage of total beds 

Independent Care Home with Nursing 



Independent Care Home with Dementia Nursing  



Independent Care Home with Mental Health Nursing 



Independent Care Home without Nursing 



Independent Care Home Older People Dementia and Mental Health  



Independent Care Home Working Age Mental Health  



Independent Care Home Sensory Loss 



Independent Care Home Acquired Brain Injury/Physical disabilities 



BHCC Care Home (CSTS) 



Independent Care Home Learning Disabilities 



BHCC Care Home Learning Disabilities 





Ownership of city based care homes 

The majority of residential care settings for older people (defined as those aged 65 and over) in the city are in the private or not-for-profit sector. The council has a very small number of homes that focus on rehabilitation and move-on support services and there is also a lack of nursing care and in particular those services that support more complex people, including dementia. 

Recently we have been made aware of an increasing number of city based care homes that are focussing on the self-funder market which reduces the number of available beds to Local Authorities. Historically this has been a small number of city based care homes and could present new challenges going forward. 

With limited development space in a small urban city there are limited opportunities to develop new provision and shape the how the market meets the needs of residents. The focus for Brighton & Hove City Council is working with the existing market, enabling adaptations to meet needs. 

Demand for care 

Prior to COVID-19 we saw small reductions in referrals, particularly in non-specialist residential care. This coincided with the city’s long established intention to support people in their community for longer and to place fewer people in registered care homes. 

Long-term support needs of older adults (65 and over) met by admission to residential and nursing care homes, per 100,00 population 

Year Council score Region score England score
2017 to 2018 748.8 561.5 585.6
2018 to 2019 794.7 517.7 577.6
2019 to 2020 733.8 526.5 584.0
2020 to 2021 656.1 489.0 498.2
2021 to 2022 438.3 524.3 538.5



Since 2022 the number of placements has risen above pre COVID levels. As we have focussed support on winter pressures to expedite the numbers of patients waiting for care in acute hospital beds, hospital discharge pathways have focused on step down residential/nursing care placements, which has inevitably increased the number of new residential admissions. 

Increasing prevalence of high frailty, dementia and complex comorbidity 

Demand has increased particularly for services that can support extremely vulnerable people with multiple conditions. This has been driven by hospital discharges, but also demographics changes.

Whilst life expectancy has been increasing, healthy life expectancy has fallen in recent years. People are living longer in ill health, with frailty and multiple long-term conditions increasingly common amongst older people in residential care.

This has been evidenced within the last Joint Strategic Needs Assessment undertaken on adults with multiple long-term conditions in Brighton and Hove highlighting the percentage of people living with long-term conditions increases with age.

Percentage of people with specified number of long term conditions, by age group, Brighton & Hove, March 2017


For those living with dementia, the recorded prevalence rates amongst people aged 65 and over in Brighton & Hove is higher than both England and the South East, (4.2% of over 65 year olds with a diagnosis of dementia, with an England average of 4.0% (2020)) with rates predicted to rise significantly in the next decade.  

Workforce, capacity, and resilience challenges 

Endemic structural workforce issues in adult social care have been made worse in recent years by the effects of COVID-19, Brexit, people exiting the labour market and the cost of living crisis. Recruitment and retention, pay and reward, support, training, and career progression are issues that continue to challenge the whole sector. This has increased the risk to services and require resilience planning at all levels to safeguard people in receipt of care.  

Workforce capacity pressures have been growing significantly over the last two years, notably impacting on the home care sector as many more people are choosing to have care in their own home rather than within a care home. This has been exacerbated by home care and care home staff leaving the care sector due to low salaries and burnout after the pandemic.

Funding provided by the government to support recruitment and retention while welcomed, is of a short-term nature. It is now more difficult to recruit staff from the European Union due to post Brexit government requirements, although Social Care carers are now on the government’s Shortage Occupancy List.  

Through engagement with Care Homes, we know that workforce remains a key challenge having lost access to overseas staff, without immediate replacements and young people who want a career in care. 

Care reform impact on fees and self-funder arrangements 

Charging Reform legislation was scheduled for introduction in October 2023, this has since been delayed until October 2025. As part of that preparation Brighton & Hove studied the self-funder market and predicted the impact of legislation change on the demand for services. 

We are conscious that although the legislation changes had additional government funding, the expected increase in demand and costs for self-funders moving to Local Authority rates would have been beyond the additional funding. This is explained further in section 2 below.  

The cost of living crisis 

The unprecedented escalation in costs, particularly energy bills, has shaken the sector. Brighton & Hove City Council faces a shortfall of £14.3 million in 2023/2024 due to demand for our services, increase inflation, the impact of the pandemic and the cost of living crisis. The Council’s budget position remains challenging over the next 4 years.  

The accommodation based care sector, Care Homes and Supported Living, have also faced rising fuel costs. Central heating is commonly in use for the majority of the year in most care homes and environments where people are relatively immobile. Similarly, food costs have increased substantially in 2022 and providers are seeking to pass these costs on.  

A further ongoing cost that providers face is the Real Living Wage increasing by 10% from £9.90 to £10.90 (a contractual requirement for Home Care providers) and the National Living Wage, currently £9.50, which has been announced to increase by just under 10% to reach £10.42 in 2023. 

Quality of city based care homes and home care providers 

Brighton & Hove City Council Quality Monitoring Team (QMT) supports contracted and in-house services. The team gather information about providers through various means e.g., complaints, compliments, plaudits, S42 enquiries (safeguarding), and one-off information from a variety of sources.

QMT also works closely with other professionals including NHS SUSSEX Integrated Care Board (ICB), and Care Quality Commission colleagues, to share information to build up a picture of the quality of care services. The QMT and ICB (quality lead/s) use a jointly developed quality assurance audit tool during all quality monitoring assurance audits. 

Over 1 January 2023 to 31 March 2023 QMT has closely monitored and provided enhanced support to 19 individual services, comprising three nursing homes, seven supported living learning disability, three care homes, one learning disability community service, one learning disability care home, two nursing home and three home care providers. Although some providers are out of scope for the Market Sustainability Plan this does show an increase of six compared to the number of providers receiving enhanced support over third quarter of the year.   

The total number for year 2022/2023 

A total of 22 providers were on the main Service Improvement Panel and received significant monitoring and support from QMT. 

Compared to 2021/2022 QMT provided enhanced support to 14 providers, 2022/2023 has seen an increase of 8 providers requiring enhanced monitoring and support from QMT and others. The figure is slightly skewed due to Achieve Together having six services registered under one registration which was CQC (Care Quality Commission) rated overall Inadequate February 2023.  

Annual fees and price uplift 

Annual fees paid for commissioned services are reviewed in line with Local Authority budget setting process, which starts in Autumn and is finalised in February each year.  

When setting annual fees, the Council considers inflationary pressures, the living wage and other cost pressures affecting Adult Social Care providers, but this must be balanced with managing the overall budget of Adult Social Care services and the wider Council.   

For residential settings we have published set rates which cover both residential and nursing homes and for our homecare provision we have a set hourly rate. The table below set out these rates as at 2022/2023. Additional Funding provided through the cost of care exercise has been applied to these rates for 2022/2023. 

Fee Rates Table 2022 to 2023


Current set fee per week 2022 to 2023 

In city care homes for people aged 65 and over


In city care homes for people aged 65 or over with nursing 

£833.19 (inclusive of FNC £209.19) 

It is important to recognise that for our residential provision and due to market pressures, we are currently only able to purchase a limited number of beds at these published rates with variable rates above this depending on market conditions.   

It is increasingly difficult to place clients at the Council’s set rates and as of October 2022 only 15% of council funded people are in care homes at set rates. Although the Set Rate is now £624 the average cost the Council paid for a care home placement in October 2022 was £816 for a Care Home providing physical care and £918 for a Dementia Care Home which is more than 33% above the Set Rate. 

We will be reviewing our published set rates alongside our commissioning of residential provision over the next few years and consideration to the Cost of Care exercise outputs will be part of this process.  This will be one of many areas of consideration when reviewing fee rates going forward and other factors such as current rates being paid, and affordability will also need to be considered. 

Assessment of current sustainability of the domiciliary care market for people aged 18 and over

There are a total of 37 providers of domiciliary care across Brighton & Hove who employ 1600 staff supporting 2000 people within the city. 22 of these providers hold contracts with the local authority. 

 Current challenges around this market are similar to the residential care market with workforce issues being a significant concern alongside the rates currently affordable by the local authority. This has already been covered in detail above. 

Quality of provision remains generally good and while during the past few years we have seen some difficulties with capacity we have not seen any significant provider failures. 

Alongside the challenges detailed above we also recognise that the current homecare contract that was commissioned six years ago is not supporting a sustainable model of delivery. This is why Brighton & Hove City Council are commissioning a new model of Home Care for both community based support and Extra Care establishments. The new contract will commence July 2023 and will operate for 5 years with the option to extend for a further 3 years.  

Areas that are being addressed are as follows. 

Ending minute by minute payments  

The current model of paying for care by the minute does not support the much needed recruitment and retention of Home Care workers in the city.

Under the current contract providers are paid only for the minutes of care that are actually provided. These call durations are variable in nature and subject to change at short notice meaning that a care call may be shorter than that which is rostered. This means that staff are not guaranteed pay or set working hours in relation to the care calls they deliver.

This will be addressed through the new contract by moving to a model where we will pay for rostered care and as such we hope will support with recruitment and retention of the workforce. 

Ending to 15 minute calls

Except in special circumstances, 15 minute care calls will no longer be commissioned as doing so is seen as poor practice due to the transactional focus and lack of person-centred approach these care calls have.

Individuals who currently receive 15 minute calls will be reassessed as part of a person’s planned review and these calls will be replaced with 30 minute minimum calls as appropriate. 

Geographical configuration 

We also recognise that the current contract configuration of 10 geographical areas is not always delivering the most efficient and effective and sustainable services with the east of the city historically proven to be the most difficult to service. This is due in part to limited recruitment of staff in that area and it is compounded by travel difficulties due to limited bus services to the outskirts.

The new Home Care services will be divided into eight contracts based on four geographical locations across the city, organised by postcode and aligning with the newly configured community assessment worker’s restructured localities: East, West, Central and North.

There will be two contracts for each area: a lead and a back-up contract. This is with the aim of supporting and enabling place-based partnerships and the collaborative arrangements formed by the organisations responsible for coordinating and delivering health and care services in each neighbourhood/community.

This will support the NHS’ Place Based Approach and complement the work being undertaken by social care colleagues regarding capacity building within the community and voluntary sector. 

Homecare Rates  

  • Home care main area/back up provider core fee: £20.07
  • Home care main area/back up provider – enhanced fee: £22.31

Rising fuel costs have hit the Care sector significantly. In Home Care carers outside the central city area regularly use cars as many outlying parts of the city are too hilly to use bicycles and it is too slow to use buses between care calls.

Alternatives to car use are being examined as part of the current recommissioning of Home Care (expected completion July 2023) but until that time it is difficult to change the existing ways of working. 

Following committee approval it has been confirmed that all providers offering the current Framework rate will receive a 6% uplift in 2023/2024.

This applies to the council’s main Framework providers who are on set rates and over 50% of other packages of care which are provided by providers on the council’s Dynamic Purchasing System. Those providers who bid at higher rates on the council’s Dynamic Purchasing System will receive either 4% or 2%. 

Annual fees paid for commissioned services is reviewed in line with Local Authority budget setting process, which starts in Autumn and is finalised in February. 

When setting annual fees, the council considers inflationary pressures, the living wage and other cost pressures affecting Adult Social Care providers, but this must be balanced with managing the overall budget of the Council and Adult Social Care services. 

Assessment of the impact of future market changes between now and October 2025, for each of the service markets

City Picture 

When considering the current and future health, social care and wellbeing needs of the City as explained by our Joint Strategic Needs Assessment (JSNA), we are anticipating a likely increase in demand for Adult Social Care Services with a percentage increase in age brackets over the next 10 years.

The biggest % increase is expected in 60 to 69 year olds (34%, 7,700 extra people) and 80 to 84 year olds (34%, 1,800 extra people). Of note there are projected to be 400 (11%) more 85 to 89 year olds and 300 (12%)  more 90 plus year olds. Brighton & Hove has similar life expectancy and healthy life expectancy compared to England. 


There are concerns on the proportion of older people living alone and percentage of older people who are income deprived. Over a third of older people (38%) live alone which is significantly higher than regional neighbours and England average. One in 5 residents (18.7%) aged 60 and over are living in income deprivation, which is higher than the national average (14.2%). 

We have similar rates of age related macular degeneration (preventable sight loss) and hip fractures but higher rates of diagnosed dementia in older people and falls with 4.2% of 65 plus year olds with a diagnosis of dementia and 2,382 per 100,000 (1,000 people) aged 65 and over admitted as an emergency to hospital due to a fall (2020/2021) 

Since 2019/2020 there has been a notable change in requests for support from new clients by age group. NHS Digital data shows that nationally there has been an ongoing decrease in requests for social care services from people 65 years and older, and nationally an increase in requests for services from those who are aged 18 to 64 years, despite a growing population aged 65 plus. Locally we have seen decreases since 2019/2020 in new requests for support across both age groups. However, the rate of decrease has been most notable within 65 plus ages, and new requests for 18 to 64 year olds have proportionally risen. 


 The impact of the above is that the number of people in long term funded care services has dropped nationally, and this trend can be seen within our own data:  

Funded care service  




Adults receiving domiciliary care 




Adults receiving residential care 




Adults receiving nursing care 




Adults receiving a direct payment 




Total number of adults provided with long term funded care 




In breaking down the data into age groups we can see a drop in numbers of clients aged 65 and over accessing long term support, falling from 6,530 per 100,000 adults in 2019/20 to 5,490 per 100,000 adults in 2021/2022. However, we have seen increases in numbers of 18 to 64 clients accessing long term support rising from 855 per 100,000 adults in 2019/2020 to 910 per 100,000 within 2021/2022.  

The latest CIPFA Performance tracker for 2022 notes a few possible reasons for this.

Firstly, the prevalence of Covid in care homes and the risk of carers bringing Covid into households, likely discouraged older people from seeking residential and home care.

Secondly, there is evidence that nationally millions more people provided unpaid care during the first year of the pandemic, as people spent more time at home, or were unwilling to allow others into their home due to fears about spreading Covid. This may have depressed demand for local authority provided care for older people.

It is unclear what has driven the increase of 18 to 64 year old clients, but this rising demand for social care from working age adults will impact on spending, due to this group often having more complex and longer term requirements than the older population. 

The rising cost of services and the increasing cost pressures experienced by many of our providers means that ensuring we have the right services at a sustainable price remains challenging.

From a budget strategy perspective, the impact of rising inflation and the impact of the pandemic on our unit costs for both residential and nursing care confirms that our current pricing framework, which was already significantly strained, remains challenged.  

Following the impact of COVID-19 and potentially of Brexit, care providers have been dealing with difficulties in workforce recruitment. This has impacted all care sectors across the country but has been particularly acute for home care providers.

Our direction of travel is still to enable people to receive care in their own homes rather than for them move to residential care, though this has been challenging over the past year due to there being currently higher demand for home care than availability. 

Adult Social Care Charging Reform is planned to be introduced from October 2025, having been delayed from the planned date of October 2023. The reforms include a more generous means-test, a cap on care costs of £86,000, a move towards a ‘fair’ cost of care, and the ability for people who arrange and fund their own care to ask their local authority to do it on their behalf.

The financial impact of these reforms is as yet not fully understood, with the Local Government Association warning that the cost of the reforms could be significantly higher than currently estimated, and could create further workforce pressure. Additional staff are projected to be required to carry out extra care and financial assessments for those seeking benefits from the reforms, including from those currently self-funding care and support.

Latest estimations of the self-funder population in Brighton and Hove taken from ONS (Office for National Statistics) and local data indicate that there are 1,200 community self-funders, 960 residential or nursing self-funders with a total estimated number of self-funders of 2,160 for BHCC. 

Therefore, based on the information known so far, we are modelling the investment required for Brighton and Hove City Council to deliver on these reforms and the implications on the market. Current demand and projected increases based upon the Charging Reform estimates indicate the most significant impacts upon Care Home placements and Community Support


Communication and engagement with providers – reflections from Fair Cost of Care exercise 

The communication and engagement to providers is well established in Brighton & Hove, it was a supportive factor in response to COVID-19 challenges and we have maintained that relationship.

Care Homes providers attend a regular forum with Local Authority Commissioning managers, key items such as Fair Cost of Care are presented with an opportunity for input and questions from Providers. Home Care providers are all invited to a fortnightly meeting, which brings together Local Authority Officers and providers for key issues and ongoing communication.  

Brighton & Hove City Council is committed to ongoing communication and engagement with providers and has continued this further as part of recommissioning in both Home Care and Care Homes.  

Plans for each market to address sustainability issues, including fee rate issues, where identified.

Care homes market for people aged 65 and over

The Health Adult Social Care Directorate is currently in the process of developing a new commissioning strategy and Market Position Statement (MPS), which will be finalised toward the middle of 2023. These documents will set out the priorities for the next 4 years and in particular the areas of development required to support a sustainable market.   

While these plans are developed and finalised, commissioning activity in respect of Care Homes and Home Care continues and these plans are set out below. 

Recommissioning of the care home contract 

The current care home contract, which ran from 2016 to 2020, has been extended twice to allow commissioners to respond to the pandemic. As the situation has eased recommissioning work has begun in earnest. We will go out to tender in Summer 2023, with the new contract in place by 31 March 2024.  

As described above, the commissioning of good quality nursing/high frailty dementia nursing care continues to be a high priority and the MPS in development will be expressing this as an area of development within the city.

Brighton & Hove City Council is seeking providers that are able to: 

  1. Facilitate safe, same day admissions for residents from community and hospital settings 
  2. Make important equipment such as profiling beds, syringe drivers and hoists available for timely admission
  3. Make admissions in the evening over seven days per week
  4. Work within a trusted assessment process, as appropriate
  5. Complete the NHS capacity tracker daily (beyond mandatory requirements) 

Spot purchasing and block contracts 

The vast majority of long stay residential and nursing placements in Brighton & Hove are made by spot purchase. Whilst this is largely successful, the council faces increasing pressures in sourcing certain types of residential care in the city at a sustainable cost.

To address this, the Council will increase the number of block contract arrangements with providers where our ability to manage supply and cost is proving difficult. The block contracts we already have in place are viewed favourably by providers, who benefit from assurance on fees and guaranteed income, supporting budget management and long-term financial planning during this demanding time economically.  

Discharge to Assess pathway 2 

There are several established services in place, but we are keen to develop new partnerships with providers that may not have delivered this service to date to ensure the right care for people leaving hospital. We would like to hear from providers that may be able to offer these services, particularly those who are able to provide nursing care for older adults with dementia, including those who walk with purpose 

Workforce development 

Brighton & Hove City Council recognise the importance of a well-trained and supported workforce in the delivery of excellent adult social care services for our residents. Significant funding is allocated to provide a full annual training programme to meet the needs of our in-house services and independent and voluntary providers working with Brighton & Hove City Council across the city. 

The training programmes we provide offer a mix of essential and mandatory training, wellbeing and developmental courses, promoting service providers to be safe and effective whilst also supporting the delivery of well managed and high quality services. 

Our training programmes are designed to provide: 

  • an up to date directory of courses for different sectors in one place for learners and managers  
  • key resources and links to information  
  • access to training certificates and history of learning  
  • eLearning programmes 
  • quality learning that is responsive to need and policy/legislative changes  
  • programmes and pathways of recommended learning with links to Skills for Care 
  • links to other partners where external opportunities are available. For example, we work in partnership with our local Health colleagues to source and provide access to funded clinical training to upskill the workforce 
  • information and support around workforce development funding opportunities, apprenticeships and qualifications 

Training programmes are also commissioned to meet the needs of services with locally delivery either face to face, online, or via an extensive eLearning offer. In addition, conferences, network events, briefing sessions and bespoke events are also planned to help providers ensure they have access to good information, advice and updates or changes to policy and legislation. 

The city council also facilitates key updates through regular newsletters and provider forums. 


As stated in previous sections the ability for the Local Authority to purchase beds at its published set rates has reduced significantly over recent years. In June 2022 the Local Government Association stated that Provider costs are likely to increase by at least 6.7% in 2023/2024. In more recent weeks (November 2022) this figure has been projected at 9%.

However, the council needs to set sustainable Fee Rates within budget and significant efforts have been made to create a nuanced yet robust approach for the setting of Fees for the 2023 to 2024 financial year.

This will continue to be reviewed on an annual basis to ensure that rates are sustainable for both providers and the Local Authority. 

Domiciliary care market for people aged 18 and over

As described in Section 1 above, Brighton & Hove City Council is currently mid-commission of a new model of Home Care for both community based support and Extra Care establishments. This new contract has been developed top provide a sustainable model of delivery and to support health and care system pressures.

The new contract will commence in July 2023 and will operate for 5 years with the option to extend for a further 3 years. The commission will focus on a strengths based approach to care delivery and not on traditional time and task duties, in line with Care Act guidance.  

The main changes required to transition from the current contracting arrangements to the new model are: 

  • an end to 15 minute calls in the community unless expressly commissioned. (Extra Care settings are approved for this duration due to the on-site nature of provision)
  • establishing a strengths based approach to care delivery 
  • working with assessment colleagues so that Care and Support plans are less prescriptive with times of care delivery with the intention, with some exceptions, that Brighton & Hove City Council’s Brokerage Team will advise providers of the total weekly hours of care needed and then for the provider to liaise directly with the Service User and/or Carer to arrange and agree a schedule
  • live performance management of KPIs (Key Performance Indicator) including timeliness of care (within 20 minutes of scheduled), carer continuity and the difference between the assessed care and that which is provided
  • that assessment, commissioners, and providers will develop partnership working arrangements with proactive engagement in right-sizing packages of care in a timely way
  • paying providers based on their rostered care  bringing about an end to minute by minute payments – and Home Care workers to be paid as rostered including travel time and the real living wage as minimum.  This is a significant change and has required increased investment to support this
  • client contribution collections will revert to being a provider task 

Brighton & Hove is currently split into 10 geographic areas across the city, but this will reduce to 4 for the new contract. The areas of the city will be organised as East, West, North and Central and they will align with the locality-based assessment teams postcode areas. For each of these areas, there will be a single provider designated as a lead, and a further provider designated as back-up. Care offered under this contract will be delivered at a fixed hourly rate. 


Providers will collect service user contributions from the client directly from July 2023. This is because the provider has the closest relationship with the service user and is more able to quickly make adjustments to care, and therefore charging, in terms of both unplanned and planned events, such as hospital admission or holidays. This change also aligns home care with all other service types as it is currently an outlier regarding this task. 

The council also operates a Dynamic Purchasing System (DPS) which acts as a back-up list and allows providers to bid for the work which has not been picked up by the lead or back-up providers. The DPS allows a competitive request for tenders for each package of care, and it is open to providers to apply to join throughout the life of the contract.

There is not a fixed price for DPS, so hourly rates are determined by the market and is sometimes linked to complexity of need.  The commissioned home care services will continue to support hospital discharge flow and closer working with health partners, other agencies, and the community and voluntary sector. 

The alignment of the home care contracts to the four community assessment localities has the aim of supporting and enabling collaborative arrangements and place-based working for health and care services in each neighbourhood.  

It is Brighton & Hove City Council’s intention to reduce the number of spot purchasing arrangements for home care made via DPS through robust contract management of the new contracts, especially in terms of the acceptance of referrals for packages of care in specific areas. 

Workforce development has already been referenced above and is available to staffing working in the Care Sector including home care. 


We will continue to review the fees for home care on an annual basis in line with the Council Annual Budget Setting Process which finalises each year in February.

We have with the new contract as with previous contract included a requirement for providers to ensure they pay their staff in line with the Brighton Living Wage and this is overseen through our approach to contract management.

Any increases to fees on an annual basis needs to be made within the council’s available financial resources.