Home care regulation will reduce choice and boost big firms’ profits
Our homecare system removes the independence and control of older people — often behind the mudguard of safeguarding. Stock picture
The regulation of nursing homes and the introduction of a statutory right to nursing home care came into being in 2009 in Ireland. This led to an influx of private equity funding which changed the shape of the sector and, according to the ESRI’s report in January 2024, 74% of beds are now in private hands with just 14 companies owning 40% of all beds nationally.
We are now on the point of bringing in similar regulation and rights to Ireland’s home care sector and these changes will make the sector even more attractive to private equity, favouring a for-profit corporate ethos to proliferate in the future.
Ireland’s home care sector is already dominated by large corporate interests with the top four players in the hands of foreign private equity funds or foreign corporate entities.
There is also significant consolidation happening within the sector with attractive multiples of eight times earnings being paid, and this will lead to a further concentration of the market into even fewer corporate hands.
Corporate providers already have a market share of 64% according to Home and Community Care Ireland’s own figures and this has increased 57% since 2018. This figure is set to increase further as regulation and a statutory right to home care make investment in the sector even more attractive.
Home care provision in Ireland is a very lucrative business but perversely an unattractive career.
The HSE pays private providers a basic rate of €31.49 while, according to Home and Community Care Ireland, their members pay an average basic rate of €14.50 which is barely above the minimum wage. This means 46% of the roughly €537m they receive from the HSE, or €247m, leaks to corporate administration and profits rather than going to where it has most effect on quality, into the carer’s pocket.
While the idea of regulation to improve service provision is positive, a one-size-fits-all regulation which limits choice also has the effect of protecting the status quo and the market share of corporate providers.
The fact is, people’s needs and situations are incredibly varied. As such, the choice open to them should be varied as well and not reduced to a limited list of corporate providers all providing the same type of care. Choices should include other options such as carer co-ops, micro providers, and smaller community-based and social organisations.
Corporate providers saying they can provide truly personalised care rings hollow as the reality is that what they provide is more a slight customisation of their standard templated care.
An overburdensome regulatory system — with an emphasis on processes and form-filling rather than outcomes — is manna from heaven for large corporate providers who have whole departments to deal with administration and processing large amounts of paperwork.
The narrative that provider registration keeps people safe is a story told by corporate providers with a vested interest in maintaining the status quo and squeezing out competition.
The heavy dominance of corporate providers in the Irish market has resulted in problems around carer recruitment and retention, as well as waiting lists for service provision.
The poor pay and conditions that corporate providers offer results in extremely high carer turnover rates in the sector. While there is no exact figure for the Irish market, in the UK turnover figures for frontline care staff are over 29%, according to Skills For Care.
The other consequence of corporate providers’ inability to recruit and retain carers is shown in significant waiting lists for home care, currently standing at over 5,500 people. This waiting list is not a result of a lack of funding but rather a lack of carers to carry out the work.
Home care is a sellers’ market. It’s a market generally populated by people often in an emergency or crisis and also by people who aren’t fully sure what good home care looks like or indeed what the options open to them are.
On the supply side, home care is also an employers’ market. If carers want work, they have to work through a limited number of corporate providers who have a monopoly on state funding. Because of this they have to accept poor wages and conditions such as ‘if and when’ employment contracts.
Both these situations put corporate providers in a very strong position and allow them to make significant profits on the back of low wages to carers.
We need to be careful that upcoming regulation within the home care sector doesn’t become a way for corporate providers to turn people’s life plans into their business model, or to turn care into a growth sector rather than a human right.
The home care sector in Ireland needs more choice and specifically that generated by direct payments and personal budgets which give people needing support more control over what their care looks like and who delivers that care. They allow people, where appropriate, bypass the rigid and standardised services offered by corporate providers and lets them decide what constitutes quality home care and what support they need to live their lives.
Importantly, direct payments also ensure more funds get to frontline staff with less going to cover the costs of intermediate corporate providers.
Corporate providers tend to label this type of choice unsafe, and push for the kind of innovation and diversification that is sustaining to their business models but not transformative of the sector.
The UK’s Care Act 2014 enshrined in law people’s right to take their equivalent of a home care package in the form of a direct payment allowing people more say over what their care and support looks like, as well as who provides that support.
For this to happen, it means we have to accept that in many cases people are experts in their own support and we need to trust them to be able to manage that. This already happens to a limited extent in our disability sector but less so with older persons which is strange when you consider our older population have a lifetime of making decisions and exercising capacity through buying houses, getting married, managing a career, and raising families. Yet our homecare system removes that independence and control — often behind the mudguard of safeguarding.
The HSE and the Government need to re-examine what the future of home care looks like and where the workforce is going to come from.
They need to look at a mix of models and delivery options and ensure that any regulatory system ensures multiple models can exist and that families can then engage with the model that suits them best.
This will ensure we have a home care system that delivers better outcomes, more efficient use of funding, and that attracts a workforce sufficient to meet demand.
- Michael Harty is the CEO of Home Care Direct, Ireland’s first online home care platform
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