Home Care Commissioning Intentions

Commissioning Intentions

Sustainable, high quality services, mindful of social care reform, offering choice to the end user
To strengthen partnership working. To have in place local support joined up with the NHS and other social care services to enable smooth flow, efficient and holistic service delivery and strong knowledge of the community for better outcomes
An outcome focused, enabling approach, sensitive to equality, diversity and inclusion, which promotes independence
Maximise the use of digital technology e.g. shared care records, routing software, EHM, CareTech,
A vibrant and diverse domiciliary care market with sufficient capacity to support more people with complex needs in their own home for longer in life,
A workforce that is good quality, stable and valued, with good career options

Long Term Domiciliary Care

Commissioned care services for longer term domiciliary care in 2024/25 is £160.5 million (£105.5 million - older people; £55 million - working age adults). This is supporting 7,465 adults with 128,000 hours of domiciliary care per week.
Personal care accounts for 90% (115,000 hours) of domiciliary care commissioned, with a further 10% (13,000 hours) commissioned to support Adults with 24-hour live-in support, night awake and night sleeping services.
Out of the 115,000 of personal care, 69% of this (79,000 hours) is for older adults whereas 31% (36,000 hours) for working age adults.
Out of the 13,000 hours of 24-hour live-in support, night awake and night sleeping services, 15% is commissioned for older adults and 85% for working age adults.

The Council has a strategy that focuses on keeping adults independent and living at home for as long as possible with their family and friends. Unfortunately there are times where support is required for a number of reasons and we are required to ensure that services are available for these adults.

The majority of care is commissioned through the Live at Home (2025) framework. This is a two-tier framework with higher quality requirements for inclusion on tier 1 (including a CQC rating of Good and Outstanding overall)
The framework is set up on a lot basis, with ranked lists for each of the 12 districts in the geographical boundary of ECC. The ranked lists are split by service type (personal care, night awake, night sleeping) commissioned under each lot

Like most local authorities, the Council faces significant pressures around the funding of social care. This is linked to increasing costs, rising demographic pressures and the increasing complexity of need that is supported. We know that the local care market faces challenges around recruitment and retention, however employment of overseas workers has helped to improve recruitment and capacity. Supply is generally good across the county, however there are still pockets of lower supply linked to rural areas.

Whilst there continues to be progress with the closer integration of Health and Social Care, there remains much to be done to improve joining up the approach across the system, particularly to avoid hospital admissions and to support discharge processes.

Next Steps

We are seeking to more closely integrate the domiciliary care and other services that support people to live independently and create the strategic approach to the delivery and shaping of these services.

We are reviewing how domiciliary care works with services that support discharge such as Reablement, Short Term Care and Discharge to Assess. We will ensure that all services that support an Adult to live at home are working effectively.

We recognise the skills, knowledge and experience that our providers offer. Although we have improved how we engage with our providers, this is an area where we need to further improve. This includes working with framework providers to co-produce solutions to the challenges we face.

We are engaging with providers at the right level, including engagement with Elected Members and Senior Officers. Engagement may increasingly be locality-based, possibly on ICB footprints.

We want to free up people to do the tasks that people are better at and use technology for other tasks where possible. As well as the 'Technology Enabled Care' service, we want to consider the following:

We will to publish live demand data on our provider portal so that providers can better understand demand and plan their business accordingly.
We want to share (in a safe way) information that might help providers build more coherent rounds in localities and broker a transfer of care where appropriate. We believe that this would enable more effective use of resources and offer the Adult a Proactive and transparent management of packages when sourcing.
We will support providers to ensure that they are able to take a holistic look at the assistive technology available and consider how it could be used to meet the needs of that individual - a personalised approach based on their specific needs.

Please click for more information on Technology Enabled Care

We are reviewing the activities we have already undertaken and are engaging further with providers to ensure to plan our next steps. This is likely to include a training offer as well as promoting the care worker profession more widely.

Please click here for more information on the Care Market Workforce Strategy

Direction of travel

Joined up health and social care
Solutions that enable people to gain, regain and maintain independence
Personalised support, based on individual choice and control
Flexible support and outcome focused support that can meet both generic and specialist needs
Increased uptake of Direct Payments
Increased uptake of Individual Service Funds (ISF's)

A skilled workforce who feel valued and enabled to deliver good quality support
Active promotion and use of digital technology
Financial sustainability
Better quality solutions; favouring Good and Outstanding Providers
Joint commissioning of services

In tandem with developing and testing various new delivery models, we have implemented an improved framework
Having a framework in place allows us to maintain a diverse market, supporting choice for Adults and develop localised solutions in a managed way
Current demand modelling indicates that demand will increase over the longer term

People are living longer and with more complex needs, therefore demand for support to live at home is expected to grow. People also tell us they want their care to be coordinated across the wider health and care system. To deliver this we need to develop stronger relationships and more outcomes-focussed services, which deliver personalised, good-quality support. During our new contract we are keen to embed a continual service improvement approach, exploring opportunities to improve outcomes for adults and supporting providers to deliver high quality services that are integrated into the local health and social care system. To support these ambitions, we will work with providers to deliver “test and learn” projects within the new contract.

Examples of these “test and learn” projects may be:

A call-off of Strategic Partners in an area to understand the benefits of focussed work with fewer suppliers.
A programme to test right-sizing, outcomes orientated, enabling practice for domiciliary care provision.
Forging stronger relationships across care providers, social care and the NHS. This could potentially extend to care providers taking on delegated functions for health and/or social care.
Testing of new sourcing technology and approaches.
Exploration and linking to new practice model.
Use of care technology alongside care staff.

Cost of Care Group 2 (Community Based Services) - 18th September 2026

Please click here to view presentation materials

High-Level Questions & Answers

What were the main objectives of the session?

Answer: ECC held the session to:

Understand key cost pressures across Supported Living and Live at Home services.
Gather provider feedback ahead of the 2027/28 uplift discussions.
Inform budget and uplift recommendations that will be presented to Cabinet in February 2027.
Assess whether current cost models still reflect provider realities.

What are the biggest pressures facing community-based care providers?

Answer: Providers highlighted several significant pressures:

National Living Wage increases.
Recruitment and retention difficulties.
Sponsorship and overseas recruitment costs.
National Insurance increases.
Employment Rights Bill changes.
Rising travel and fuel costs.
Void costs in Supported Living.
Administrative and compliance burdens.
Digital system replacement costs.
Housing shortages delaying move-on opportunities.

What concerns were raised about overseas recruitment?

Answer: This was one of the strongest themes of the meeting.

Providers reported that:

Costs of overseas workers are higher
Salaries have to be paid regardless of whether there are void hours
Compliance requirements have increased significantly.
Sponsorship licence management costs continue to rise.
Legal advice and immigration support are becoming essential.
Home Office enforcement activity has increased.
Licence revocations create substantial business risks.

Examples shared included:

Compliance platforms costing around £600 per month.
Annual audits costing around £1,500.
Sponsorship-related costs estimated at approximately £1,000 per sponsored worker per year.
Two providers spending £30,000 challenging a licence revocation. Some of this can potentially be clawed back, but that is at the discretion of the Home Office.
Provider advised that a licence could be reinstated and then revoked the following day

Providers stressed that many care businesses depend heavily on sponsored workers.

Does the current cost model reflect providers' actual costs?

Answer: Most providers felt it does not fully reflect current operating costs.

Key concerns included:

Staffing costs continue to rise.
New employment legislation is creating additional financial burdens.
Compliance costs were not significant when the original cost models were developed.
The 3% surplus/profit assumption does not provide sufficient resilience and is not realistic.

Several providers stated that costs have changed substantially since the models were first created.

Uttlesford provider felt a different set of rates should be used for rural districts

What concerns were raised about the 3% profit/surplus assumption?

Answer: Providers strongly challenged the assumption that a 3% surplus is sufficient.

Comments included:

A 3% margin is too low for sustainable business operation.
Organisations need reserves for unexpected costs.
Compliance and legal costs can quickly eliminate a 3% surplus.
Businesses need funds for reinvestment and growth.
Providers questioned whether investors would enter the market for such limited returns.

ECC agreed to review the basis for the 3% assumption.

How are rural providers affected differently?

Answer: Providers operating in areas such as Uttlesford raised concerns about:

High travel times.
Increased fuel costs.
Dispersed populations.
Difficult recruitment.
Lower operational efficiency than urban areas.

The view expressed was that providing care in rural Essex is significantly more expensive than in densely populated areas such as Basildon, but rates do not always adequately reflect that difference.

What issues were identified regarding Supported Living services?

Answer: Supported Living providers identified:

Significant costs associated with voids.
Delays in filling vacancies.
Housing shortages preventing move-on.
Increasing staffing and employment costs.
Difficulty maintaining service sustainability when voids remain unfilled.

Providers reported some void costs running into hundreds of thousands of pounds annually.

What concerns were raised about housing and move-on opportunities?

Answer: Providers described a shortage of suitable housing options.

This means:

People remain in higher-cost placements longer.
Move-on pathways are blocked.
Supported Living schemes experience reduced flow-through.
Local authorities continue paying for more expensive placements.

Providers described this as both a housing issue and a care system issue.

What impact is the Employment Rights Bill expected to have?

Answer: Providers anticipate significant new costs from:

Day-one statutory sick pay.
Rights to guaranteed/contracted hours.
Shift cancellation payments and fines.
Increased employment administration.
Reduced flexibility around zero-hours arrangements.

Providers warned that community-based care services rely heavily on workforce flexibility, and future legislation could dramatically change operating models.

What concerns were raised about Live at Home (Domiciliary Care)?

Answer: Providers noted that:

Care packages can stop immediately when people are admitted to hospital – call cancellation and providers not being paid for suspended packages is an issue as staff on fixed hour contracts need to be paid.
Providers receive no payment while being expected to retain workforce capacity.
Future employment legislation may make this increasingly expensive – if zero hours contracts are restricted from the sector, this will have a big negative impact on providers.
Restarting care packages after hospital discharge is not always working smoothly.
The increase in NI contributions has been a bigger impact than changes to SSP requirements.

ECC acknowledged ongoing work to improve hospital discharge and package restart processes.

Were National Insurance increases discussed?

Answer: Yes.

Providers highlighted substantial cost increases from National Insurance changes. One provider reported an additional cost of approximately £250,000 annually.

ECC clarified that National Insurance increases had been funded within the 2025/26 uplift calculations for both Live at Home and Supported Living services.

Were digital technology costs raised?

Answer: Yes.

Providers explained that:

Digital care recording systems introduced several years ago are now due replacement.
Tablets and devices are reaching end-of-life.
Maintaining digital systems creates ongoing costs.
These costs may not be sufficiently reflected within current funding assumptions.

What feedback was given on annual uplift arrangements?

Answer: Providers generally requested:

More predictable uplift arrangements.
Earlier notification of future uplifts – one provider suggested 4-month lead time
A clearer link between uplifts and actual operating costs.
Better ability to plan budgets and staffing.

Some suggested a more comprehensive annual calculation rather than smaller incremental adjustments.

What did ECC say about its current market position?

Answer:

Supported Living

187 providers on the framework.
50 providers approved for complex needs.
Current rates:

Non-complex: £23.40/hour
Complex: £25.96/hour

Cumulative uplift since 2018 is approximately 50%.
Essex is among the higher-paying authorities nationally.

Live at Home

394 providers on the framework.
Current rate range:

£26.04 to £30.32 per hour.

Essex rates sit above national averages.

What key message did ECC hear from providers?

Answer: The strongest feedback themes were:

Employment-related costs are increasing rapidly.
Overseas recruitment compliance has become a major financial pressure.
The 3% surplus assumption may no longer be realistic.
Rural delivery models face higher operating costs.
Void costs and housing shortages create significant financial risks.
Future Employment Rights legislation could fundamentally affect provider business models.
Providers need more sustainable funding and longer-term financial certainty.

Executive Summary (One-Line Takeaway)

The dominant message from community-based providers was that growing employment, sponsorship compliance, recruitment, travel, void and housing-related costs are significantly outpacing current funding assumptions, with many providers warning that future Employment Rights legislation could fundamentally change the economics of Supported Living and Home Care services.

Supplier Questions

Q: Do these costs reflect Statutory Sick Pay from day 1

A: The costing models do not specify the underlying employment terms and conditions - they are based on percentages. The LAH model assumes 2.9% (approx. 7.5 days per year for a FTE worker). The SL model assumes 5% but this figure also includes maternity and paternity leave.

Q: Where is the carer's actual cost for providing the service in the figures shared?

A: The costing models use NLW as a starting point, and assume certain enhancements for weekends and bank holidays. This gives an average hourly rate which all other figures are based off of.

Q: Is the mileage rate recognised in the pricing the HMRC approved mileage allowance?

A: The mileage rate in the costing model still assumes the 45ppm previous HMRC tax free figure. No additional monies have been given to the council to fund the increase. During the fair cost of care process, it was apparent that many providers weren’t paying close to this figure to their staff. Staff can however claim tax relief on the difference through HMRC. This is called Mileage Allowance Relief and ensures a worker is not out of pocket if their employer reimburses below the approved rate.

Q: Are the additional costs incurred such as pay for travel time, mileage and petrol taken into consideration in the cost structure?
A: Yes, travel time and mileage reimbursement are included in the cost structure.

Q: Under the upcoming employment rights act 2025 reforms, providers will have a statutory obligation to pay zero hours frontline staff financial compensation for short notice shift cancellations. Will the Council be changing their cancellation terms to reflect this?
A: There is still no confirmed implementation date for these reforms, however the current contract sets out that the Council will pay for a visit if an adult cancels after midday of the day prior to the visit. We will continue to consider the supplier feedback on this arrangement and review the terms if necessary.

Additional comments following the event

The profit figure of 3% was queried during the meeting. This was based on the Homecare Association (previously UKHCA) assumption. They still build in 3% profit margin (or operating surplus) into their theoretical minimum price calculations for sustainable homecare.

There were a few queries raised relating to the National Insurance increase not being funded, this was responded to in the meeting but just to confirm, we increased the NI assumptions in each model at the time by 3% - 3.5% and this uplift was awarded as part of the 2025/26 inflationary increases.

Please click here to view presentation materials

High-Level Questions & Answers

What were the main objectives of the session?

Answer: ECC held the session to:

Understand key cost pressures across Supported Living and Live at Home services.
Gather provider feedback ahead of the 2027/28 uplift discussions.
Inform budget and uplift recommendations that will be presented to Cabinet in February 2027.
Assess whether current cost models still reflect provider realities.

What are the biggest pressures facing community-based care providers?

Answer: Providers highlighted several significant pressures:

National Living Wage increases.
Recruitment and retention difficulties.
Sponsorship and overseas recruitment costs.
National Insurance increases.
Employment Rights Bill changes.
Rising travel and fuel costs.
Void costs in Supported Living.
Administrative and compliance burdens.
Digital system replacement costs.
Housing shortages delaying move-on opportunities.

What concerns were raised about overseas recruitment?

Answer: This was one of the strongest themes of the meeting.

Providers reported that:

Costs of overseas workers are higher
Salaries have to be paid regardless of whether there are void hours
Compliance requirements have increased significantly.
Sponsorship licence management costs continue to rise.
Legal advice and immigration support are becoming essential.
Home Office enforcement activity has increased.
Licence revocations create substantial business risks.

Examples shared included:

Compliance platforms costing around £600 per month.
Annual audits costing around £1,500.
Sponsorship-related costs estimated at approximately £1,000 per sponsored worker per year.
Two providers spending £30,000 challenging a licence revocation. Some of this can potentially be clawed back, but that is at the discretion of the Home Office.
Provider advised that a licence could be reinstated and then revoked the following day

Providers stressed that many care businesses depend heavily on sponsored workers.

Does the current cost model reflect providers' actual costs?

Answer: Most providers felt it does not fully reflect current operating costs.

Key concerns included:

Staffing costs continue to rise.
New employment legislation is creating additional financial burdens.
Compliance costs were not significant when the original cost models were developed.
The 3% surplus/profit assumption does not provide sufficient resilience and is not realistic.

Several providers stated that costs have changed substantially since the models were first created.

Uttlesford provider felt a different set of rates should be used for rural districts

What concerns were raised about the 3% profit/surplus assumption?

Answer: Providers strongly challenged the assumption that a 3% surplus is sufficient.

Comments included:

A 3% margin is too low for sustainable business operation.
Organisations need reserves for unexpected costs.
Compliance and legal costs can quickly eliminate a 3% surplus.
Businesses need funds for reinvestment and growth.
Providers questioned whether investors would enter the market for such limited returns.

ECC agreed to review the basis for the 3% assumption.

How are rural providers affected differently?

Answer: Providers operating in areas such as Uttlesford raised concerns about:

High travel times.
Increased fuel costs.
Dispersed populations.
Difficult recruitment.
Lower operational efficiency than urban areas.

The view expressed was that providing care in rural Essex is significantly more expensive than in densely populated areas such as Basildon, but rates do not always adequately reflect that difference.

What issues were identified regarding Supported Living services?

Answer: Supported Living providers identified:

Significant costs associated with voids.
Delays in filling vacancies.
Housing shortages preventing move-on.
Increasing staffing and employment costs.
Difficulty maintaining service sustainability when voids remain unfilled.

Providers reported some void costs running into hundreds of thousands of pounds annually.

What concerns were raised about housing and move-on opportunities?

Answer: Providers described a shortage of suitable housing options.

This means:

People remain in higher-cost placements longer.
Move-on pathways are blocked.
Supported Living schemes experience reduced flow-through.
Local authorities continue paying for more expensive placements.

Providers described this as both a housing issue and a care system issue.

What impact is the Employment Rights Bill expected to have?

Answer: Providers anticipate significant new costs from:

Day-one statutory sick pay.
Rights to guaranteed/contracted hours.
Shift cancellation payments and fines.
Increased employment administration.
Reduced flexibility around zero-hours arrangements.

Providers warned that community-based care services rely heavily on workforce flexibility, and future legislation could dramatically change operating models.

What concerns were raised about Live at Home (Domiciliary Care)?

Answer: Providers noted that:

Care packages can stop immediately when people are admitted to hospital – call cancellation and providers not being paid for suspended packages is an issue as staff on fixed hour contracts need to be paid.
Providers receive no payment while being expected to retain workforce capacity.
Future employment legislation may make this increasingly expensive – if zero hours contracts are restricted from the sector, this will have a big negative impact on providers.
Restarting care packages after hospital discharge is not always working smoothly.
The increase in NI contributions has been a bigger impact than changes to SSP requirements.

ECC acknowledged ongoing work to improve hospital discharge and package restart processes.

Were National Insurance increases discussed?

Answer: Yes.

Providers highlighted substantial cost increases from National Insurance changes. One provider reported an additional cost of approximately £250,000 annually.

ECC clarified that National Insurance increases had been funded within the 2025/26 uplift calculations for both Live at Home and Supported Living services.

Were digital technology costs raised?

Answer: Yes.

Providers explained that:

Digital care recording systems introduced several years ago are now due replacement.
Tablets and devices are reaching end-of-life.
Maintaining digital systems creates ongoing costs.
These costs may not be sufficiently reflected within current funding assumptions.

What feedback was given on annual uplift arrangements?

Answer: Providers generally requested:

More predictable uplift arrangements.
Earlier notification of future uplifts – one provider suggested 4-month lead time
A clearer link between uplifts and actual operating costs.
Better ability to plan budgets and staffing.

Some suggested a more comprehensive annual calculation rather than smaller incremental adjustments.

What did ECC say about its current market position?

Answer:

Supported Living

187 providers on the framework.
50 providers approved for complex needs.
Current rates:

Non-complex: £23.40/hour
Complex: £25.96/hour

Cumulative uplift since 2018 is approximately 50%.
Essex is among the higher-paying authorities nationally.

Live at Home

394 providers on the framework.
Current rate range:

£26.04 to £30.32 per hour.

Essex rates sit above national averages.

What key message did ECC hear from providers?

Answer: The strongest feedback themes were:

Employment-related costs are increasing rapidly.
Overseas recruitment compliance has become a major financial pressure.
The 3% surplus assumption may no longer be realistic.
Rural delivery models face higher operating costs.
Void costs and housing shortages create significant financial risks.
Future Employment Rights legislation could fundamentally affect provider business models.
Providers need more sustainable funding and longer-term financial certainty.

Executive Summary (One-Line Takeaway)

Supplier Questions

Q: Do these costs reflect Statutory Sick Pay from day 1

Q: Where is the carer's actual cost for providing the service in the figures shared?

A: The costing models use NLW as a starting point, and assume certain enhancements for weekends and bank holidays. This gives an average hourly rate which all other figures are based off of.

Q: Is the mileage rate recognised in the pricing the HMRC approved mileage allowance?

Q: Are the additional costs incurred such as pay for travel time, mileage and petrol taken into consideration in the cost structure?
A: Yes, travel time and mileage reimbursement are included in the cost structure.

Q: Under the upcoming employment rights act 2025 reforms, providers will have a statutory obligation to pay zero hours frontline staff financial compensation for short notice shift cancellations. Will the Council be changing their cancellation terms to reflect this?
A: There is still no confirmed implementation date for these reforms, however the current contract sets out that the Council will pay for a visit if an adult cancels after midday of the day prior to the visit. We will continue to consider the supplier feedback on this arrangement and review the terms if necessary.

Additional comments following the event

Last updated: 01/10/2026