Private brokers are making millions of pounds a year finding care home beds for NHS patients who are fit to leave hospital.
Agencies are being hired to provide “discharge services”, finding suitable places for elderly patients amid pressures on the health system, Observer analysis shows.
Carehome Selection Ltd, the UK’s biggest social care brokerage, has expanded in the past five years and now claims partnerships with 150 NHS organisations and local authorities, with revenues of £20m, up about 75% compared with 2018.
In 2021, the most senior director of its parent company was paid £609,000, up from £138,000 in 2020, according to its latest accounts.
The agency is one of the biggest beneficiaries in a group of firms providing brokerage services, predominantly helping councils seeking places for patients stuck in hospitals.
A chronic lack of social care capacity means up to one in three hospital beds in England are occupied by patients who are ready to leave, with the backlog contributing to record ambulance and treatment delays.
Care home brokerages help identify suitable care home places so that medically fit patients can be discharged, freeing up capacity in overstretched wards. But such arrangements are usually made by the NHS and councils dealing directly with each other and local social care providers.
Daisy Cooper MP, health spokesperson for the Liberal Democrats, said the reliance on agencies was “a scandalous situation”. “The government’s failure to plan has left local authorities with no choice but to turn to private brokers for even the most basic of functions,” she said.
Carehome Selection says its services save money and speed up discharges. “Our service model includes evening and weekend working, so no time is lost,” its website says. The company says it has “close relationships” with care providers, which pay a fee when a service user is referred. Patients and their families do not pay.
Last week, the firm signed a three-month, £223,000 contract with Leeds city council to provide “brokerage services to find step down beds so people can leave hospital into care homes”. In July, it began a £243,000 contract with Bournemouth, Christchurch and Poole council to provide a “brokerage service for self funders” until March 2023.
In County Durham, the company is being paid to assess patients and help match them with suitable care home places. That contract, signed in April, is worth up to £1.95m over five years.
Carehome Selection was founded by a GP in 1995 and started working with the NHS 20 years ago. It has scaled up operations since receiving a £10m cash injection from investment firm BGF in 2018 and subsequently saw its revenue grow by 75% to more than £20m, delivering a “strong return” for investors.
In 2021, the company was acquired by private equity-backed Acacium, which also runs agencies supplying staff to the NHS and says it is “the UK’s largest healthcare solutions partner”. During the pandemic, Acacium – part of the Onex Corporation, owned by Canadian billionaire Gerald Schwartz – was criticised for charging up to £170 an hour for nurses, four times the approved framework rate.
The firm said at the time that “far from inflating fees” during the pandemic, it had “increased the availability of discounted rates, waived cancellation fees and capped travel costs to customers”.
Another NHS supplier offering discharge services said on its website that it helps “return patients to their homes safely, avoiding unnecessary delays”. Its service is for “hospitals who are experiencing a large number of delayed transfers” and councils facing delays “due to capacity issues”.
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NHS trusts and local authorities are also paying agencies to assess patients’ care needs, analysis shows, including those waiting to be discharged from hospital or entitled to funding due to complex long-term health problems.
In one case, Leeds city council is outsourcing patient assessments to help it “clear the backlog of referrals to hospital social work teams”. The contract will see a consultancy firm assess 100 patients and is worth £40,000.
A spokesperson for the council said it was experiencing a significant shortage of social workers, which had affected hospital discharge teams. “In order to continue to support timely discharges, the council has secured agency staff on a temporary basis and is also trialling a brokerage service which supports the admission of people into residential care,” he said.
The council said its initiatives were being funded using an allocation from a £500m government fund announced in September to support hospital discharges. Local health and care organisations were told they could use the funding “flexibly” to tackle “the areas facing the greatest challenges”.
Rory Deighton, director of the acute network at the NHS Confederation, said using private providers to help coordinate hospital discharges may not be appropriate in every case but could offer value for money and reduce backlogs.
A spokesperson for Carehome Selection said it “commits to and is paid based upon performance-based outcomes centred on accelerating speed of hospital discharge”. They added that clients using the service had reduced the average time to discharge medically fit patients from 10 to three days.
The Department of Health and Social Care said: “The purpose of the £500m discharge fund is to reduce the number of bed days lost to delayed discharge. It is for NHS trusts and local authorities to decide whether to access support from the private sector in improving flow through the health and social care system.”