According to Laing & Buisson efforts to divert demand away from care homes appear to be running out of steam as the proportion of private payers rises.
The number of elderly or physically disabled people living in care homes is rising, despite public policy favouring non-residential solutions to support needs of the country's ageing population
The healthcare intelligence provider's 2011/12 Care of Elderly People UK Market Survey reports that the number of elderly or physically disabled people living in care homes in the UK rose to 421,000 in the year ending April 2011 - growth of 6,500 beds since 2010.
This is partnered with a reported reduction in the number of homecare hours provided in 2009/10 (the latest available figures) when the number of hours dropped by 8% from 200m a year to 183m per year.
The funding profile of England's care home population continues to move towards private payers in 2011, with some 41% of residents (159,000) now fully responsible for their own fees.
Although state supported residents retain a majority share at 50.5%, if quasi-private payers are taken into account - those who pay ‘top up' fees over and above those met by their local authority - in combination with outright private payers this group makes up the national majority of care home residents at 55%.
NHS funded residents also increased their share to 8.5% of residents across all home types and to 20% of those more specialist nursing homes.
Commenting on the evolution of the funding profile, report author William Laing said: "Within the state paid sector, most councils froze their baseline fee rates in the face of swingeing cuts in central government funding.
In contrast, the private pay market continues to bear significant fee increases.
"As a result Laing & Buisson has found that care home fees have risen at a surprisingly high compound annual growth rate of 3.5% for nursing care and 4% for residential care over the last four years, with no sign of a break in the trend in 2011/12.
Nonetheless, care home operators with a high level of exposure to local authority funding will have experienced significant pressures on margins in 2011/12, with further pressure expected in 2012/13."
Looking ahead Laing concluded: "While the potential exists for fundamental change in the social care market, the elephant in the room is that transformation and personalisation has to take place at a time of intense pressure on council budgets. Truly personalised care services are likely to be more expensive rather than less expensive."
