Care homes and estimating the self-funding population, England: 2019 to 2020

• Between 2019 and 2020, 84.7% (391,927 of 462,460) of care home beds were occupied in England, and there were approximately 143,774 (36.7%) self-funded care home residents, compared with 248,153 (63.3%) state-funded care home residents.

• The South East had the highest proportion of self-funders (45.4%) compared with the North East, which had the lowest (24.6%).

• Care homes located in the least deprived areas had a statistically significantly higher proportion of self-funders (53.8%) than care homes in the most deprived areas (21.6%).

• Smaller care homes, with 1 to 19 beds, had the lowest proportion of self-funders (15.1%), which is statistically significantly lower than all other care home sizes.

• Care homes providing care for older people had the highest proportion of self-funders (49.6%); this was statistically significantly higher than care homes providing care for younger adults which had the lowest proportion of self-funders (4.8%).

This experimental method is a new method we are developing to understand the size of the self-funding population in care homes in England. The estimates produced using weighted data can be used as a pre-coronavirus (COVID-19) pandemic baseline of the self-funding population in care homes.

This is the first publication the Office for National Statistics (ONS) has released on the self-funding population of care home residents. We have launched a public survey to gather feedback from potential users to help with the development of this experimental work. Please see our blog for more detail on the future developments of this project. Alongside this release we have also published a methodology paper for an in-depth understanding around the estimation method, definitions and data sources used.

There are differences in how social care data are collected and reported. Information relating to the number of people receiving long-term support from local authorities is published by NHS Digital as part of the Adult Social Care Activity and Finance Report. However, this does not cover adult social care activity that is funded elsewhere, for example if the care is arranged and funded by the client without any involvement from the local authority. The Office for Statistics Regulation (OSR) highlighted that the lack of official data on self-funders makes it difficult to estimate the size and expenditure of the self-funding population (see Report on Adult Social Care statistics in England). Our experimental method aims to begin to fill this significant evidence gap and can be used as a pre-pandemic baseline comparison for future releases including time periods impacted by the coronavirus (COVID-19) pandemic.

This article contains data from the Adult Social Care (ASC) provider information return (PIR) for residential services (care homes with or without nursing), which is collected by the Care Quality Commission (CQC). This has been analysed alongside other data sources (the CQC Care directory and National Statistics Postcode Lookup), to understand the size of the self-funding population in England. In this article, PIR refers only to the residential PIR for ASC services, although the CQC collects other PIRs for different service types. The data used for the analysis covers the pre-coronavirus pandemic period August 2019 to February 2020 (inclusive). This has been weighted up to an annual estimate for England. You can find more information in the data sources and quality section.

This publication focuses on those individuals who self-fund within a care home setting (a care home with or without nursing care). A self-funder is defined as an individual who falls into one of the following categories. They either:

• pay for their own care privately (either organised by themselves or through the local authority)
• have their care provided by a charity

They may also receive NHS-funded care (which pays part of but not all the care home fee). State-funded individuals are those receiving local authority (LA) funding or continuing health care funded entirely by the NHS. The definition used in this publication is based on the guidance provided to care homes by the CQC when distributing a PIR (see Glossary). For an overview of the way people can access care services in England please refer to our Care Pathway Model.

Proportions of self-funding and state-funded residents are calculated within each care home category. For more information please refer to the supporting methodology paper.

In England, there were approximately 391,927 care home residents between 2019 and 2020, and approximately 143,774 (36.7%) of these were classified as self-funders, compared with 248,153 (63.3%) state-funded residents. In terms of occupancy, 84.7% of care home beds were occupied in England.

The South East had the highest proportion of self-funders (45.4%) and the North East had the lowest (24.6%), which is a statistically significant difference. Regional differences may occur as the value of an individual's property can be considered in the financial assessment for the funding of care, and average property value varies by region. When averaging data from the UK House Price Index published by HM Land Registry (HMRC) from August 2019 to February 2020, the region with the highest average house price was London (£474,411). This was followed by the South East (£321,733), and the lowest average house price was in the North East (£129,402).

House prices alone do not explain regional differences, as London has the highest average house price, but the second lowest proportion of self-funders (29.3%). However, local authority districts in London typically have lower percentages of owner-occupied dwellings, and higher percentages of privately rented dwellings than other regions (see Subnational estimates of dwellings and households by tenure, England: 2019). Other factors related to property, such as household composition, could also impact the likelihood of someone being a self-funder. For more information, please refer to the Care and support statutory guidance (Annex B: Property disregards).

Breaking down differences by local authority (Table 1), excluding local authorities that have been suppressed as part of disclosure control, the highest proportion of self-funders is in Cotswold (78.3%), and the lowest proportion is in Southwark (3.8%). Three of the five local authorities with the lowest proportion of self-funders are in London. This may be explained by the relatively young age of the London population. In 2019, Inner London Built Up Areas had the smallest share of people aged 65 years and over in its population (9.5%) followed by Outer London Built Up Areas (13.8%) compared with other parts of England and Wales (Understanding towns in England and Wales: population and demographic analysis). The Health Foundation suggests that younger adults are less likely to be self-funders as most younger people “will have built up fewer assets over their lifetimes than older people and are also unlikely to have income from a pension”.

There was a statistically significantly higher proportion of self-funders in rural areas (44.2%) compared with urban areas (34.9%) (Figure 2).

Another way to compare geographic differences is to look at the Index of Multiple Deprivation (IMD), which is a measure of relative deprivation at a small local level (see Glossary for further explanation). Figure 3 shows that care homes in the most deprived areas (decile 1) had a lower proportion of self-funders (21.6%) than care homes in the least deprived areas (decile 10; 53.8%) and this difference was statistically significant.

The difference in the proportion of care home residents self-funding in rural and urban areas could be partly explained by the differing levels of deprivation in these areas. Research from Department for Environment, Food and Rural Affairs shows that in 2019, rural areas tended to be less deprived than urban ones; 12% of people living in urban areas were in areas that were within the most-deprived 10% of the IMD, compared with just 1% of people living in rural areas. Access to social care in rural areas could also be a contributing factor. A report by Public Health England (PDF, 906KB) states that population sparsity and wide geographical areas leads to higher costs and organisational challenges of social care services. This can lead to reduced opportunities in rural areas to support an individual’s social care needs.

This section analyses self-funders broken down by care home type, care home size, provider size, care home rating and nursing care provision.

For care home type, only 4.8% of residents in care homes providing care for younger adults (aged 18 to 64 years) were self-funders, which was statistically significantly less than all other care home types. As discussed in Section 3, younger adults are less likely to receive income from a pension or have savings or assets that would result in an individual being ineligible for local authority support (The Health Foundation).

When comparing the proportion of self-funders within each care home type, care homes providing care for older people (aged 65 years and above) have a statistically significantly higher proportion of self-funders (49.6%) compared with theproportion of self-funders in all other care home types (Figure 4). However, it should be noted that the majority of self-funders are resident in care homes providing care for dementia (75.0%; See Figure 5), because the majority of all care home residents are in such homes (70.2%). For more information about care home types please refer to the Methodology.

Care homes with 1 to 19 beds had the smallest proportion of self-funders (15.1%). This was statistically significantly lower compared with all other care home sizes (Figure 6). However, the other care home sizes did not differ significantly from each other. Analysis of the Care Quality Commission’s (CQC’s) Care directory shows that younger adults tend to receive care in smaller care homes; the average number of beds in care homes for younger adults is nine, compared with 31 in care homes for older people. As seen in Figure 4, a smaller proportion of residents in care homes for younger adults are self-funding compared with all other care home types. Another explanation for the low proportion of self-funders in smaller care homes could be that there are more care homes with between one and 19 beds in urban areas, compared with rural settings because of space restrictions. As seen in Figure 2, there is a smaller proportion of self-funders in urban areas.

Care homes run by providers that run a single care home have a statistically significantly higher proportion of self-funders (41.3%) than those managed by providers that run multiple care homes (34.3%).

The highest proportion of self-funders were resident in care homes rated “Outstanding” (47.1%), which is significantly higher than all other ratings. The lowest proportion of self-funders were resident in care homes rated as “Inadequate” (31.2%).

There is a higher proportion of self-funders in care homes that do not provide nursing care (37.4%) compared with those that do (35.9%). However this difference is not statistically significantly different (Figure 9). It is important to note that not all individuals living in care homes that provide nursing care could be receiving it.

A subset of variables was analysed for only care homes that provide care for older people, individuals with dementia or both. The proportion of self- and state-funders were calculated for:

• region
• Index of Multiple Deprivation
• care home size
• care home rating
• upper tier local authority
• nursing care provision

Please see accompanying datasets for these data.

Looking more closely at care home size and nursing provision variables, the proportion of self-funders in the one to 19 beds category (38.3%) was statistically significantly lower than the 20 to 39 beds category (44.5%) but not statistically significantly different from the other categories. This is in contrast to the findings from the whole sample (see Figure 6). This suggests older people (who are more likely to self-fund their care when compared with younger adults) tend to reside in larger care homes. For nursing care provision, there was a statistically significant higher proportion of self-funders in care homes that do not provide nursing care (45.6%) compared with those that do (36.5%). This was not statistically significantly different for the whole sample (see Figure 9).

Care home resident

An individual who receives care in a place where personal care and accommodation is provided together. In this publication a care home refers to care homes with or without nursing care, however specialist college services are not included in this definition. You can find more information in the Care homes and estimating the self-funding population, England: 2019 to 2020 methodology.

Self-funded care home residents (“Self-funders”):

The provider information return (PIR) defines a self-funder as an individual who pays for their own care privately. They can receive this in a number of ways:

• organised by themselves or through the local authority

  • This is where an individual is over the saving/income threshold and therefore organises their care themselves or requests the local authority to arrange the care for them, but the individual still funds the full cost

• provided by a charity

  • Individuals who receive care in a charity-run care home are also defined as self-funders, as the term charity refers to the organisation running the care home, but individuals who do not meet the eligibility criteria for state-funding will still be self-funding

• NHS-funded nursing care

  • If an individual is in receipt of NHS-funded nursing care in a care home, they will have an amount paid for by the NHS, deemed to be the cost of the nursing care they receive; however, the rest of the cost could be self-funding, depending on their financial situation, therefore have been included in this definition
  • It is important to note that not all individuals in receipt of NHS-funded nursing care will be self-funding, they could also be in receipt of local authority support; NHS-funded nursing care should not be used to directly measure the size of the self-funding population

State-funded care home resident:

The PIR defines a state-funded care home resident as an individual whose care is funded in full or in part by the local authority and/or the NHS. This includes:

• paying user charges when funded by local authority

  • This is where the local authority has assessed an individual as having care and support needs and the individual has savings/income below the required savings/income threshold and is funded by a local authority. However, the individual may pay additional cost to the local authority (a user charge)

• NHS continuing healthcare

  • This is where an individual’s needs have primarily been deemed as health-based, as per the decision support tool, and therefore care is fully funded by the NHS (state)

• personal budget

  • This is where an individual has been assessed through the local authority as having care and support needs and has savings/income below the threshold, so is given a budget to arrange care themselves, for example through a personal assistant; however, care is still funded through the local authority

• third-party top up

  • This is where an individual has been assessed through the local authority as having care and support needs and has savings/income below the threshold, therefore is state funded; however, their care may be more expensive than the local authority is willing to pay, so a third party pays an additional cost (this is not categorised as a self-funder, as this cannot be paid for by the individual)

Care home types

Care homes have been categorised into four different groups based on the users that they provide care for. Users are derived by the service user band variables in the Care directory, which a care home is required to specify when registering as a provider. You can find more information in the supporting methodology. The groups are defined as follows:

• dementia (all ages)
• older person (aged 18 to 65 years)
• younger adults (aged up to 64 years)
• other

A variable that combines the “older people” and “dementia” care home type categories has also been created. This contains an estimate of the proportion of self-funders in care homes that provide care to older people, care homes that provide dementia care, and care homes that provide both. These breakdowns are available in the accompanying dataset.

Statistical significance

The term “significant” refers to statistically significant changes or differences. Significance has been determined using the 95% confidence intervals, where instances of non-overlapping confidence intervals between estimates indicate the difference is unlikely to have arisen from random fluctuation. See our statistical uncertainty page.

Index of Multiple Deprivation (IMD)

National deciles of area deprivation are created through ranking small geographical populations known as Lower layer Super Output Areas (LSOAs) based on their deprivation score from most to least deprived and grouping them into 10 divisions based on the subsequent ranking.

The Index of Multiple Deprivation (IMD) is a score based on the area as a whole, and not everyone within a LSOA necessarily experiences the same level or type of deprivation. For example, some unemployed individuals live in less deprived LSOAs, while some higher-income individuals live in more deprived LSOAs. Similarly, deciles are a broad grouping and the levels of deprivation and the underlying factors determining the LSOA-level deprivation score will vary within the decile. Those LSOAs at the higher and lower end of each specific decile may vary considerably from each other.

This article provides information concerning the number of care home residents who self-fund their care using provider information returns (PIR) data from the Care Quality Commission (CQC). Alongside this return, the Care directory, and National Statistics Postcode Lookup File were used to produce these statistics and to understand care home characteristics such as the CQC rating, care home type, care home size and geographic variations. Alongside this release we have published a methodology article outlining the methods used.

The PIR is a mandatory return for adult social care residential services in England. The CQC supplies providers with a link to an electronic form and invite the service to complete and submit the form. The aim of the PIR is to have a census of care homes that are registered with and have been inspected by the CQC any time prior to or during the year collection period. Approximately a twelfth of providers are surveyed each month, meaning all eligible care homes are surveyed within the year. However, the data collection included in this release began in August 2019 and was suspended March 2020 because of the impact of the coronavirus pandemic (COVID-19) and is therefore a curtailed census. Consequently, this experimental method is based on a sample of care homes and has been weighted to provide England-level annual estimates.

The experimental method presented here provides a first look at those self-funding in care homes, and we will be developing this method further in the future. We have launched a public feedback survey, closing on 15 November 2021. We welcome feedback via this survey from anyone with an interest in the data, methods and analysis presented.

Strengths include:

• this analysis filling a significant evidence gap and meeting user data needs as there are very limited data relating to funding in care homes at a care provider level; the aggregated figures can be used as a pre-coronavirus pandemic “baseline estimation” for analysts
• enabling us to understand more about the link between care home characteristics and the presence of self-funders within them
• creating impactful work that can be used by government departments, public sector organisations, care providers and the public to better understand the size of the self-funding population in care homes
• this being the first step in a programme of work being undertaken at ONS to investigate this under-researched population

Limitations include:

• the current release focusing only on the characteristics of care homes in relation to the self-funding population; it will also be important to understand the characteristics of individuals who self-fund their care (see our blog for future developments)
• at present we are not able to present equivalent estimates for community care; however, we recognise that understanding this is important for a fuller picture of the self-funding population and social care as a whole (see our blog for future developments)
• the errors in the data (see accompanying methodology paper) mean some of the sample is lost because of cleaning