As part of the wider Adult Social Care Charging Reforms which have now been delayed until 2025 (following the Chancellor of the Exchequers announcement in November 2022), local authorities were required to complete a fair cost of care exercise during 2022/2023 to arrive at a shared understanding with providers of the local cost of providing care. This exercise was intended to ensure that people find Adult Social Care fair and accessible.

For the purposes of the exercise, the Department of Health and Social Care (DHSC) consider ‘fair’ to mean the median actual operating costs (the amount in the middle of the lowest cost and the highest cost) for providing care in the local area (following completion of the exercise). ‘Fair’ also means what is sustainable for the local market. This is, on average, what the Department of Health and Social Care expect local authorities to move towards paying providers under the now delayed guidance.

Data received from providers has been cleansed where appropriate however, there remains some concerns over the quality and reliability of data provided, particularly for care homes.

Due to the reasons detailed within the Care Homes Annex B report, the Council does not believe the care home results represent a fair cost of care across the whole market.  As a result, due regard has been given to the information provided by this exercise as part of 2023/24 fee setting process but it is not the sole basis of fee setting for 2023/24 and future years.

The report of Lancashire County Council's Fair Cost of Care Exercise is published below. It follows the guidance of the Department of Health and Social Care and reflects the key principles of consistency, transparency, and a partnership approach. It also reflects the specific circumstances of Lancashire County Councils adult social care provider market. In the guidance from the government this report is known as “Annex B”. There are two Fair Cost of Care Exercise (annex B) Reports. One for Care Homes for Over 65 year olds and one for Over 18 Homecare.

If you are a provider and have any questions, or would like to discuss further, please email our Commissioning Team.