A software tool to aid long-term care budget planning at local authority level

Summary

Objective

Local authorities face real challenges when it comes to annual budget planning for funding the system of long-term care. Uncertainty about the long-term cost of caring for current residents in the system, in addition to unknown future admissions, have made the tasks of local authority budget managers very complex and demanding. In this paper, we present a software implementation of a novel forecasting framework developed by the authors to provide useful information to local authority budget planners involved in long-term care.

Methods

The tool is built upon a forecasting framework, which combines unit costs of care with an estimated underlying survival model for publicly funded residents in long-term care, to provide forecasts of the cost of maintaining the group of elderly people who are currently in long-term care (referred to as known commitments) for a period of time. A prototype version of the software tool, which was created and tested in collaboration with an English borough, allows user interaction via a friendly graphical interface that guides through a set of screens of options in a familiar wizard fashion.

Results and discussion

Feedback from care planners and managers show that the tool helps them gain better understanding of the patterns of length-of-stay of residents under their care, and provides quantitative inputs into their decision making on budget planning for long-term care. The development of the software tool brings advanced modelling techniques out of research papers into the hands of decision makers in the public sector and contributes to improving the delivery of long-term care.

Introduction

As people get older, activities of daily living, such as feeding, toileting and self-care, can become difficult. In general, long-term care (LTC), which is provided to people who are unable to look after themselves without some degree of support, embraces all forms of continuous, social, personal and nursing care, and associated domestic services [1]. In this paper, the term LTC refers to residential care (RC) and nursing care (NC) provided in institutional care homes, e.g. residential homes and nursing homes. As the world population is ageing, it is generally believed that LTC will become an even more important issue for an ageing society [2]. Governments around the world have been alerted with the potential difficulties in funding and managing LTC, and are attempting to address the difficulties in their own ways.

Local authorities in England play a major role in running the system of LTC. Under current regulations (i.e. the 1990 NHS and Community Care Act and the Care Standard Act 2000), local authorities are responsible for the placement and finance of all publicly funded residents in LTC that conforms to national standards. The ability to discharge elderly patients to LTC is essential in the planning and running of acute hospital care. Under the Community Care (Delayed Discharges, etc.) Act 2003, local authorities have been facing financial penalties since January 2004 for failing to provide vacancies in institutional care homes for hospital discharges [3].

Given limited resources available, local authorities have a keen interest in knowing the behaviour of the LTC system, in particular, how long residents stay in the system, and ultimately, how much the system will cost. From the prospective of local authorities, the emphasis is placed on the residents who require funding support from the public. A national survey [4] in England showed that 73% of the residents admitted to LTC in 1996 were publicly funded, and most of them were there on a permanent basis, i.e. not expected to go back to their own homes.

Extensive studies have been conducted in Britain to develop macro models for projecting the demand and hence the cost of LTC at the national level [5], [6]. This type of model, which adopts a “whole system” approach, is typically useful for strategic planning for a nation.

However, at a local level, a methodology that takes into account local characteristics in its forecast will be more suitable. Especially, as far as cost is concerned, local authorities need a method that can help their budget planning and allow evaluation of the potential effects of changes in regulations and financial context on the use of resources and costs. Good budget planning is essential to ensure the successful delivery of LTC that balances demand and provision.

In previous studies [7], [8], we developed a forecasting framework for predicting the cost of LTC arising from known commitments from a local authority perspective. The term known commitments refers to the group of publicly funded residents currently in the LTC system. Knowing the projected cost associated with this group of residents is of particular interest to local authorities as it corresponds to the burden they cannot escape. This information will enable local authorities to identify the fraction of the budget that is already committed due to past admission decisions. Given this information, local authorities will also have a fair idea about the resources available for new admissions in a financial year.

In Section 2, we briefly describe the forecasting framework and its data requirement. In Section 3, we describe a software implementation of the framework, which was developed in collaboration with an English borough. In Section 4, we demonstrate the use of the tool based on data from the borough. The usefulness of such a software tool is discussed in Section 5.