Ridout Report – CQC’s public consultation on its proposed fee increases

Topics covered: Ridouts professional advice

CQC has opened a public consultation regarding its proposed fee increases for providers of health and social care.   The proposed fee increases are designed to ensure that CQC will be in a position to collect the full cost of carrying out its regulatory functions from providers over the course of the next two to four years.

What are the specifics of the consultation?

Like many public regulatory bodies, CQC is required by the government to set fees in order to cover the costs of its statutory duties (CQC defines its provider fees as a charge to providers to cover their costs of entering and remaining in a regulated market, which includes CQC’s registration, inspection and enforcement functions).  The Health and Social Care Act 2008 gives CQC powers to charge fees associated with its statutory functions.

The consultation is inviting comments and opinions from providers and stakeholders in respect of three proposals, the main one of which concerns CQC’s intention to increase provider fees for 2017/18 and thereafter increase its provider fees until it reaches full chargeable cost recovery (“FCCR”) across all sectors (excluding dentists) by 2019/20.

The exact level of CQC’s proposed fees, which have been calibrated according to provider type and size, can be viewed on CQC’s website.  By way of summary, CQC will be seeking to collect approximately £26.5 million more in fees from health and social care providers in the 2017/2018 period than in 2016/2017.  This reflects a 3.7 percent increase on current fees for care home providers, a 75 percent increase for NHS GPs and a 60 percent increase for the community social care sector in 2017/2018.

A sample of the proposed fees are set out below:

Fee Category Example Band Size 2016/2017 actual fee 2017/2018 proposed fee Percentage increase
NHS trusts Turnover from £125 million to £225 million £136,864 £202,239 47.76%
Independent hospitals 4 to 6 locations £42,545 £43,836 3.03%
Single locations GPs 5001 to 10000 patients £2,574 £4,526 75.84%
Multiple location GPs 5 locations £9,518 £16,736 75.84%
Care home providers From 26 to 30 service users at a location £4,212 £4,375 3.87%
Community social care providers Single location £1,369 £2,192 60.12%

Issues within the wider health and social care sector

Whilst the average proposed fee increase of 3.7 percent for care home providers for the next financial year does not, on the face of it, appear unduly onerous, it comes shortly after CQC’s David Behan publicly acknowledged on 13 October 2016 that the sustainability of the adult social care market is approaching a “tipping point”.  Consequently even what appears to be a small increase on the face of it could have a potentially serious impact on providers.

GPs will bear a proportionately large increase in fees in 2017/2018, in order to achieve full cost recovery for their sector over the next two years.  This increase could, on the face of it, serve to antagonise GPs, particularly as many of them object to being regulated by CQC at all.  This proposed increase in fees also comes shortly after CQC’s May 2016 ‘Shaping the Future’ document, which announced that CQC will be inspecting GP services rated as good or outstanding at intervals of up to five years instead of the current two yearly interval.  As CQC has rated 87 percent of all GP practices that it has inspected since October 2014 as ‘good’ or ‘outstanding’, it would appear on the face of matters that most GPs will be paying a higher provider fee for a significant reduction in the frequency of CQC inspections.

Providers’ response to CQC’s consultation

Despite the fact that a public consultation has been launched, the Treasury’s ultimate requirement for CQC to become a self-funded body means that the prospect of overall fee increases are almost inevitable.  This should not, however, deter providers from responding to CQC’s public consultation for two reasons:

1.  There may be scope for providers to push for a smaller increase in the proposed fees in their particular sector; and
2. The consultation affords providers an opportunity to articulate and re-emphasise to CQC the difficulties that they are facing.

The proposed changes are subject to the outcome of the consultation and the final consent of the Secretary of State.  CQC has stated that its consultation will close at noon on 11 January 2017 with the proposed changes due to come into effect on 1 April 2017. We would encourage providers to take the opportunity to respond to the proposal.

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