The meaning behind these words is less one of warning but more an emphasis to be constantly vigilant and adaptable in the face of unprecedented demands on the social care sector.

Care providers should scrutinise their contract management practices with a view to preventing the accrual of debt and to maximise fee recovery.

Contract Management

Care providers should collate and detail the various terms and conditions in force under placement agreements. This is best done using a centralised contract database.

The ability to effectively manage contracts will afford providers the ability to (i) achieve and maintain operational efficiency, (ii) ensure value for money, and (iii) allow for cooperation between stakeholders.

The above can be achieved by being able to (i) adhere to applicable deadlines, timelines and milestones in contracts, (ii) access relevant information for the safe provision of care, and (iii) report and review performance under the terms of the contract and regulatory framework.

Cash Flow

Social care providers are more sensitive to cash flow now than before Covid-19. It is therefore important to ensure cash is recovered for services rendered.

Efficient contract management will identify cash flow issues. Addressing non-payment of fees early drastically increases the likelihood of recovery and helps to preserve the placement.

Protecting Cash Flow

There are two main methods by which a care provider can ensure payment of fees from a private resident.

Firstly, there is the personal guarantee whereby a next of kin, usually a son or daughter, is made liable for any unpaid fees under the terms of any placement contract. This provides an alternative avenue to recover unpaid fees and focusses the mind of the guarantor on the financial viability of the placement.

Secondly, a charge can be registered on the resident’s property. This is suitable where the resident is moving out of a property they own and is looking to fund the placement from the proceeds of sale. A charge formalises the above so the provider then does not need to waste resources chasing payment.

Conclusion

Providers should focus more than ever on the fundamentals of running an efficient business. Putting these operational steps in place, or refining them, will ensure the service is safer, more efficient, and more likely to withstand the stress test of a pandemic winter.

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