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Rise of the Super Care Package


It will be of no surprise to anyone that the cost of providing care is on the rise. There is no one single cause but some of the relevant factors include an aging population, low general levels of unemployment, and fewer potential carers in the workforce following Brexit and the pandemic.

Last October the ONS ASHE (Annual Survey of Hours and Earnings) figures showed a 5% increase in gross earnings for all employees, the highest since records began. However the rise for caring, leisure and other service occupations was 6.7%. This caused the care and case management element of periodical payment orders (PPOs) to be uplifted by a whopping 6.56% (Table 26.5a SOC20 6135 & 6136 80%) last December, compared to 2.32% the year before.

The latest CPI inflation figures (August 2023) shows inflation is 6.7%. There was also a rise in the National Living Wage last year which will factor into this year’s figures. We are expecting to see a double figure percentage increase in the care rates when the figures are released later this month. If the rate is increased by 10% then that will be a circa 17% increase in two years.

It could certainly be argued that carers have an undervalued role in society. They spend their time with the most in need members of society doing, quite frankly, some incredibly difficult jobs, often in very trying circumstances. Many would certainly have no issue with their pay rising faster than other parts of the economy, particularly when most are on minimum wage and we are in a cost of living crisis.

However, the lack of available carers is a real problem. During a case which was settled last year, I was told by a care expert that there were almost 1,000 vacancies for carers within 10 miles of the claimant’s property. This particular claimant needed a care team of 12 carers to provide round-the-clock care. Unsurprisingly, recruitment was an issue.

So how did we solve it? Well, enter what I am going to call the Super Care Package provider. Instead of paying £15 per hour for a carer, we had to pay £35 ph. The cost of the care package went from a staggering £550k pa to £1.1M pa. This is not the only case I am aware of where the care package is now costing more than £1M pa. Fortunately in this case, we were able to agree a strategy with the claimant’s representatives to bring that total down to a slightly lower, but still higher than previous, level over the short to medium term.

Super Care Packages work by the provider throwing money at the problem. Whilst that solved the lack of carers issue for my case where the need for care was absolute, what effect does that have on the cost of care for someone who only needs a few hours a day or week? In the last month, I have been quoted £35 ph for someone who needed nine hours support a week. To say that is a massive increase from a few years ago is an understatement.

Those of us who deal with these sorts of care packages regularly know that if you want to pay an agency to provide it (and in doing so take on the risks associated with employing carers), you have to pay more per hour. The alternative is a direct employment care package, which is administrated by either the claimant themselves or their case manager. The real issue with this sort of package is predicting what the cost will be next year, let alone in three to five years. The cost of a carer is rising so fast that it is almost impossible to predict what it will be in the future with any level of confidence.

The other issue with Super Care Packages is that, for good reasons, judges are reluctant to tinker with other care packages that are already in place and working. Why would they? The test is one of reasonableness. The fact that there is a cheaper alternative does not mean that the more expensive option is unreasonable (an important legal principle that many forget). Ensuring that a sensible care package is in place at the time of settlement or trial is critical. Unless the existing package is shown to not be working, then it is likely to be adopted as the long term solution. This means that if an insurer has a case where you have a Super Care Package, it is going to be very difficult to avoid paying it for the long run.

My worry is that we are heading towards a two-tier care system in personal injury claims;

  1. Cases which have a Super Care Package, which are fully funded and as stable as a care package can be.
  2. Every other care package where there will be a constant risk that the carer will leave to join a Super Care Package, earning significantly more.

Until we can expand the workforce or make being a carer more attractive to more people, it is difficult to see how this issue can be resolved.

However, it is not all doom and gloom. Super Care Packages are still relatively rare and only used in the most serious of injury cases (spinal cord injuries resulting in paralysis and very severe traumatic brain injuries). In those cases, insurers need to ensure they engage lawyers who are experienced in dealing with these packages and how to mitigate the risk that the long term default position will be a Super Care Package. A strong working relationship between the parties’ representatives is critical in these cases, especially to keep open statutory funding options, which is often the only real way to mitigate an insurer’s potential indemnity spend.

The wider issue is when or if care inflation will start to come down to more traditional levels, as that affects many more cases in an insurer’s book of business. Until then insurers may wish to buy off cases sooner, perhaps for more than they may wish to pay right now, to mitigate the risk of the case being worth significantly more next year and the year after. Christmas is always a good time for settlements and so now is the time to review any cases which you have concerns about.

Keoghs Complex Injury team has a number of people used to dealing with these types of cases and who would be delighted to assist, so please do get in touch if you have queries around the issues discussed.

In the meantime I, for one, await the next ASHE figures due 1 November with increased trepidation.

Phill Bratt

Phill Bratt

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