The Ombudsman's final decision
Summary: Mrs X complained the Council reduced her mother, Mrs Y’s, direct payment after earlier agreeing a higher amount. This was after Mrs X had already sourced a care provider that was providing care to Mrs Y. The care provider’s charges were more than the new direct payment amount, so the Council said a top-up fee would apply. We found the Council was at fault for failing to perform due diligence setting up a direct payment agreement. However, the Council does not have a duty to pay a privately sourced care provider’s full costs where it can meet a person’s needs more cost effectively. The remedy offered by the Council is suitable for the injustice caused.
The complaint
Mrs X complained the Council reduced her mother, Mrs Y’s, direct payment after earlier agreeing a higher amount. This was after Mrs Y had already sourced a care provider that was providing care to Mrs Y. The care provider’s charges were more than the new direct payment amount, so the Council said a top-up fee would apply.
Mrs X said the Council was not transparent about charges and did not provide all relevant information at the outset. She also said its communication throughout was poor.
Mrs X said she would likely have chosen a cheaper care provider if the Council gave the correct information from the start. Mrs X does not want to change Mrs Y’s care provider now as she has complex care needs and is happy with the care received. Mrs X is worried about the impact changing care providers would have on Mrs Y’s wellbeing.
The Ombudsman’s role and powers
We investigate complaints about ‘maladministration’ and ‘service failure’. In this statement, I have used the word fault to refer to these. We must also consider whether any fault has had an adverse impact on the person making the complaint. I refer to this as ‘injustice’. If there has been fault which has caused significant injustice, or that could cause injustice to others in the future we may suggest a remedy. (Local Government Act 1974, sections 26(1) and 26A(1), as amended) If we are satisfied with an organisation’s actions or proposed actions, we can complete our investigation and issue a decision statement. (Local Government Act 1974, section 30(1B) and 34H(i), as amended)
How I considered this complaint
As part of the investigation, I considered the complaint and the information Mrs X provided.
I made written enquiries of the Council and considered its response along with relevant law and guidance.
Mrs X and the Council had an opportunity to comment on my draft decision. I considered any comments received before making a final decision.
What I found
Care plan and personal budget The Care Act 2014 gives councils a legal responsibility to provide a care and support plan, where a person has eligible care needs. The care and support plan should consider what needs the person has, what they want to achieve, what they can do by themselves or with existing support and what care and support may be available in the local area.
The support plan must include a personal budget, which is the money the council has worked out it will cost to arrange the necessary care and support for that person.
The council should share an indicative amount with the person, and anybody else involved, at the start of care and support planning. It should confirm the final amount of the personal budget through this process. The detail of how the person will use their personal budget will be in the care and support plan. The personal budget must always be enough to meet the person’s care and support needs.
There are three main ways a personal budget can be administered: As a managed account held by the council with support provided in line with the person’s wishes.
As a managed account held by a third party (often called an individual service fund or ISF) with support provided in line with the person’s wishes; or As a direct payment.
(Care and Support Statutory Guidance 2014) Direct payments Direct payments are monetary payments made to individuals who ask for them to meet some or all of their eligible care and support needs. They enable people to arrange their own care and support to meet those needs. The council must ensure people have relevant and timely information about direct payments so they can decide whether to request them. If they do so, the council should support them to use and manage the payment properly.
Top-up payments If a person chooses a care provider that costs more than the personal budget, and the council can show that it can meet the person’s needs with a less expensive provider within the personal budget, it can still arrange care with that provider if: the person can find someone else (a ‘third party’) to pay the top-up; or the person has entered a deferred payment scheme with the council and is willing to pay the top-up fee themself.
In such circumstances, the council needs to ensure the person paying the top-up fee enters a written agreement with the council and can meet the extra costs for the likely duration of the agreement.
What happened I have summarised below some key events leading to Mrs X’s complaint. This is not intended to be a detailed account of what took place.
Mrs Y has several care and support needs, including with domestic tasks like washing, dressing, and mobilising in and out of bed.
The Council commissioned a package of care for Mrs Y in March 2023. Two carers visited Mrs Y four times a day, for 30 minutes each visit. The care was seven days a week. The total cost of the care package was £582.40 per week.
In July and August 2023, Mrs X told the Council they were not happy with the current care provider (Provider One), due to the attitude of the carers. She asked about the possibility of a new care provider. She also asked about direct payments and how much Mrs Y would receive.
The Council told Mrs X the hourly rate for direct payments is £23, and the total payment would be the same as the funding for Mrs Y’s current care package. It said if Mrs X found a new care provider charging more than £23 an hour, a top-up fee would apply.
Mrs Y went into hospital for a procedure on 10 August 2023. Due to the issues with Provider One the care package ended. The Council started looking for a new care provider.
Mrs X returned home from hospital in September 2023. She had four care visits of 30 minutes each day, from two carers. This was from a new care provider (Provider Two).
Mrs Y was not happy with the times Provider Two visited. She also wanted Mrs X to have 45-minute calls in the morning and evening.
Mrs Y told the Council she found a new care provider (Provider Three) and wanted them to take over the care package using a direct payment.
The Council received costings for Provider Three on 5 October 2023. It calculated a direct payment of £1,350.16 per week, which was the same as Provider Three’s weekly quote. This was based on four double handed calls per day, seven days a week. Mrs Y would receive 45-minute calls in the morning and evening, and 30-minute calls for lunch and tea.
The Council and Mrs X signed the direct payment agreement on 20 October 2023. The agreement states the care plan had a start date of 9 October, with the Council paying £1,350.16 per week. The top-up fee was recorded as ‘nil’.
Mrs X chased the direct payment in early November. The Council said it was waiting for it to be authorised. Mrs X was confused about why the Council entered an agreement for direct payments for the full cost of Mrs Y’s care, but now said it was waiting for authorisation. She said the family cannot afford Provider Three’s invoice and would not have chosen them if the Council had not agreed.
The Council apologised. It said there was miscommunication between teams when Mrs Y left hospital, resulting in an oversight in the cost of the direct payment and top-up fee. The Council said it would waive the fees for the first invoice, but moving forward there would be a top-up fee. The Council said the top-up fee applied from 6 November if Mrs Y wanted to continue with Provider Three. If not, another care provider would be sourced using a direct payment or commissioned service.
Mrs X was angry and asked to complain. She said she gave the Council details of the care charges in September, and signed a direct payment agreement to cover these charges. At no point did the Council say the amount was not possible or had not been authorised. The care package started on 9 October with the Council’s knowledge. The error was the Council’s, and the top-up fee was not affordable.
The Council responded to Mrs X’s complaint on 4 December 2023. It said there was a miscommunication around top-up fees and direct payments. It apologised this was not clearly explained and agreed it fell short of expected standards. It also said it spoke to the relevant team to ensure they improve communication.
The Council confirmed it would waive the top-up fee until 10 December, giving time to find another care provider if needed.
Going forward, the Council said Mrs Y could remain with Provider Three and pay a top-up fee, or look for a cheaper provider with a lower or no top-up fee. Alternatively, the Council can source a commissioned provider.
The Council emailed Mrs X on 8 December 2023 to inform her it found a new care provider who could meet Mrs Y’s needs.
Mrs X said Mrs Y was very happy with the care she receives from Provider Three. She also said a top-up fee does not apply in this case because the costs of Mrs Y’s care do not exceed her personal budget.
The Council said if Mrs Y wanted to remain with Provider Three, they would have to pay a top-up fee. This would involve a new direct payment agreement with a new amount, based on the £23 hourly rate.
Mrs X asked the Council not to contact her anymore about the financial aspect of Mrs Y’s care. As far as she was concerned, the Council entered a contact with them for the direct payment.
My investigation Mrs X told me she did not understand personal budgets at the time, as the Council did not send paperwork and was not transparent about its policy.
The Council confirmed Mrs Y’s direct payment was £1,350.16, but there was a delay setting it up. However, there was a signed direct payment agreement, so Mrs X started Mrs Y’s care package with Provider Three.
When Mrs X chased the direct payment, the Council told her it had not been authorised by a supervisor. The Council then told Mrs X there had been a miscommunication, and Mrs Y’s direct payment should actually be £805. This meant paying a significant top-up fee for Mrs Y to stay with the same care provider.
Mrs X chose Provider Three because of its ability to meet Mrs Y’s needs, but if the Council had given the correct information at the outset, she may have chosen a different provider. Mrs X said it would be distressing to change provider now.
The Council told me the direct payment of £1,350.16 is the total cost of Mrs Y’s care package with Provider Three. However, it mistakenly missed out the third-party top-up fee when calculating the payment. It then manually changed Mrs Y’s personal budget amount to reflect the direct payment. This was done without following correct assessment procedure.
The Council said it explained third-party top-up fees to Mrs X when Mrs Y went into hospital. It told her if the proposed charges for Mrs Y’s chosen care provider were more than a provider offered by the Council, a top-up fee would apply.
However, the Council said an error occurred when the hospital discharged Mrs Y. The top-up fee was not communicated to the officer calculating Mrs Y’s direct payment, so was mistakenly not included.
The Council suggested an alternative care provider which would avoid a top-up fee and offered a grace period where it would not charge the top-up fee with the current care provider. It also offered £300 for the inconvenience.
The Council told me it would risk assess any change in care provider to make sure it is suitable and can meet Mrs Y’s needs without compromising her support or wellbeing.
Analysis The Council accepts it was at fault for errors in setting up the direct payment agreement. I also found it was at fault for not providing Mrs X with enough clear and timely information about the direct payment process, personal budget, and top-up fees.
When Mrs X approached the Council about a direct payment, Mrs Y’s care package included four, 30-minute visits by two carers, (or four hours’ care each day), seven days a week. Using the Council’s standard hourly rate of £23 that would equate to a direct payment of £644 a week. While the Council did tell Mrs Y a direct payment would reflect the current care package, it did not give a breakdown of figures for her to base the search for a new provider on.
When the hospital discharged Mrs Y, she initially had care from Provider Two, commissioned by the Council. However, the family wanted 45-minute visits in the morning and evening, taking Mrs Y’s care up to 5 hours a day. The Council appears to have agreed to this when Mrs X sourced Provider Three. That would increase Mrs Y’s budget for the direct payment from £644 a week to £805 a week. However, the costings for Provider Three were significantly higher, at £1,350.16 a week.
Unfortunately, the Council did not clearly communicate Mrs Y’s personal budget to Mrs X when she was searching for a new care provider.
In addition, when the Council learned about the new provider’s higher costs, it simply used the figures as the direct payment amount and inserted it into the agreement. It did not check the figures or go back to Mrs X asking them to find a cheaper provider. The Council showed a lack of due diligence setting up the direct payment agreement. That was fault. The Council’s focus was on starting a new package of care for Mrs Y as soon as possible.
While I have seen evidence the Council communicated with Mrs X to explain what a top-up fee is and when it would apply, I have not seen evidence the Council told Mrs X there would be a top-up fee in this case with their chosen new care provider. In fact, the opposite is true. The paperwork the Council sent states there would not be a top-up fee, and the direct payment amount would cover the full costs of the care package.
Mrs X argued Mrs Y’s personal budget is the same as the cost of the care package, so no top-up fee applies. Because the Council had already assessed Mrs Y needs when it commissioned a package of care for her in March 2023, the personal budget the Council produced then would still be in effect at the time Mrs Y asked about a direct payment.
Usually, the Council will change someone’s personal budget after a re-assessment when there is a change in their needs. It will then calculate a budget using its standard hourly rate, based on the number of hours’ care needed. In this case, the Council did not do things correctly. It changed the personal budget to reflect the agreed direct payment and did not consider whether a top-up fee was required. I can therefore understand why Mrs X made this point.
Mrs X pointed out this was the Council’s error, and because Mrs Y formed a relationship with her new carers, who were meeting her needs, she should be allowed to continue with the new provider and the Council should cover the full costs.
It is not in the Ombudsman’s power to force the Council to meet Provider Three’s full costs, particularly where those costs are significantly higher than what the Council could source with another provider. The Council has a duty to meet eligible care and support needs, but it also has a responsibility to do this in a cost-effective manner. While I am aware the family had issues with the previous care provider commissioned by the Council, they were meeting Mrs Y’s needs. And there is nothing to suggest a different care provider could not also meet Mrs Y’s needs. I cannot justify asking the Council to use more of its resources where it can find a different provider who can meet Mrs Y’s needs within budget.
Mrs X suggested there is a contract in place which the Council must honour. We do not have powers to make binding decisions about parties’ responsibilities and liabilities under contracts, that is the role of the courts. However, the agreement in place does enable the Council to review a person’s circumstances and change the amount of the direct payment. It also enables the Council to withdraw the agreement where circumstances have changed.
If the Council, or the family, can find a new care provider that can meet Mrs Y’s needs, I did not see evidence she will suffer any significant injustice in terms of the care received. Having to change carers will cause some frustration and inconvenience, and it may take Mrs Y time to adjust to a different provider. That is her injustice. However, there is no evidence at this point to suggest a different care provider will be detrimental to Mrs Y’s wellbeing. That is for the Council to assess.
As well as agreeing to waive the top-up fee while matters were resolved, the Council also offered a payment of £300 for the inconvenience caused. This is in line with our remedy guidance, and I did not see evidence the offer was insufficient for the level of injustice caused.
Agreed action
Within four weeks of my final decision, the Council will: Repeat its apology for failing to perform due diligence when the direct payment agreement was set up, recognising this raised expectations and that having a new care provider will cause frustration and inconvenience.
Pay £300 for the frustration and inconvenience its fault caused.
The Council should provide us with evidence it has complied with the above actions.
Final decision
I completed my investigation. The Council was at fault for failing to perform due diligence setting up a direct payment agreement. However, the Council does not have a duty to pay a privately sourced care provider’s full costs where it can meet a person’s needs more cost effectively. The remedy offered by the Council is suitable for the injustice caused.
Investigator’s decision on behalf of the Ombudsman
Investigator's decision on behalf of the Ombudsman