Having grown through the acquisition of local authority contracts over the past 20 years, CEO Dan Hayes says OSJCT is taking control of its destiny through a new phase of development targeted at the private fee payer market.
CHP: Tell us about your background and how you joined OSJCT.
DH: My background is in HR. I got my HR qualification at Nottingham Trent University. I worked initially in the public sector, in the police force and in the NHS for a number of years in acute and mental health services. After a short spell in the academic world, I joined the Trust in 2003. It was then growing organically through local authority acquisitions. It needed a Head of HR to work with the HR Director to put together OSJCT people policies. It was a really interesting job. I knew very little about care homes. I wasn’t sure what to expect but within a few weeks I grew to love the organisation. It’s a big organisation but you are so close to what happens in the homes and in the services and it’s so immediately apparent how important the work is. I felt a real affinity with it from day one. I was in HR for about four years and then was given an operational secondment for a care services management job in Oxfordshire and after a year or so I was lucky enough to get the directorship for that part of the Trust. In 2011, I became Operations Director and 2015 became Chief Executive. We give our own people an opportunity to develop. We’re quite good at recognising talent and I have been a beneficiary of that.
CHP: Can you give an overview of the Trust?
DH: It’s a little bit over 25 years old. It’s sponsored by two religious orders – The British Association of the Sovereign Military Order of Malta and The Venerable Order of St John. They provide our Trustee Board and governance. On a day to day basis, the organisation is entirely secular. I am not a person of faith but the faith principles that the organisation is established on are really important because they influence our values and they are about trust. Individuals who come to live and work with us can trust our intentions are absolutely transparent and are to do the best for them.
The first major social care interest that the Trust took was in the Lincolnshire care homes that transferred out for the local authority in the early 90s. We took on 16 of those services and we still operate 15 of those in Lincolnshire. We have built in that way largely since. In the late 90s, our Wiltshire local authority care homes came on board. In 2001 and 2005, our transfers from Oxfordshire and Gloucestershire local authorities followed, respectively.
We no longer have a block contract with Lincolnshire but we still have a close relationship with the local authority. We now own the freeholds of the transferred Lincolnshire homes, and about 50% of our beds are purchased by the local authority in those homes. In the other three counties, we have substantial block contracting arrangements for publically funded residents of up to 30 years. Most of those contracts have a re-provisioning element. Along with the Bedfordshire Pilgrims Housing Association we have worked in partnership with the local authority to redevelop a number of those homes. We are just about in the middle of most of these contracts. We are starting to look ahead at what the future brings for the Trust and for the people we care for.
Now our strategy is slightly different, though that’s not to say we would not look at a big transfer opportunity if it came along, we intend to take more control of our destiny in the way that we are growing or changing. We have developed a strategy which moves us to a greater percentage of self-funded fee payers. That’s just all about sustainability. We have got good relationships with all our commissioners but they are hard pressed to fund services at the appropriate level. It’s a simple question of whether you want to be here in the longer term.
We are looking to move to around a 50:50 private:LA split from 38:62 currently. Because of the contracts we have we are not able to change their mix significantly so we have taken on a financing arrangement and decided to build a number of homes from our own reserves where we can get a greater percentage of self-funders into those new environments and that creates a benefit across the whole of the organisation.
We have built six homes over the last two years. We own two outright, we have built two through lease arrangements with developers and built two through our relationship with a local authority and social housing landlord. We are looking at around 80% self-funders in those homes. We will never be big enough to go in one direction only. I see other opportunities in the future for a management contract type arrangement.
CHP: Do you intend to maintain your current geographic split?
DH: We have a real core of talent in the areas we operate. We have home managers and service mangers who absolutely know their communities and are at the heart of them. Extending onto that is much easier then establishing yourself in a whole new area. Where we are, there are lots of opportunities to grow organically. We are having good discussions also with commissioners about the future. My sense is that there is some momentum now about going back to working properly in partnership with commissioners to redefine social care delivery in the areas we are working in.
We are split at each end of the spectrum in terms of our care. We have the independent supported living at one end and very specialist care at the other end. The bit in the middle – the standard residential and nursing care – is disappearing gradually. We deliver care into over 600 extra care apartments and at the other end of the scale we see the potential for developing our specialist end of dementia, nursing and behavioural services. Those kinds of services are much more integrated by definition with the NHS. They offer stimulating employment opportunities for nurses.
When we are going into renegotiation with commissioners we are building services to accommodate intermediate care. Our new care home in Henley, which we built with Bedfordshire Pilgrims Housing Association, offers rapid access beds and intermediate care beds that are being used magnificently. They are literally next door to a new hospital. We have intermediate, step up, step down services in all the counties we operate in. We have to say we are not going to re-tender on one or two occasions but when we have done that we have tended to gain the contract eventually any way when there has been a realisation that really good care comes at a sensible price.
CHP: How do you assess the current recruitment climate?
DH: I don’t remember a more difficult time in social care for recruitment and retention. We should be a million miles from the National Living Wage. People in social care don’t do an easy job. It’s a really challenging job that comes with high risk and we ask our people to put all their heart and compassion into it. It’s part of our job as chief executives to lobby for our staff to occupy a different part of the employment market.
We have modernised our recruitment offer in the last two or three years. We have internet based systems. People can apply through a one-click method on their phones or on an app. We have an applicant tracker system that has reduced the time to hire from 12 weeks to an average of four or five weeks. We are holding turnover at about 4% below the sector average.
We are just keeping our heads above water. Our target is to get into the mid-teens within the next three or four years. You could argue that we are pretty good at recruitment. It’s closing the back door that’s the problem. That’s a mixture of being really honest about the role and just how much fulfilment there is changing people’s lives. Induction and support in the first few months is everything. If people stay six months or a year, they are likely to stay much longer. We run an employee awards programme in every county and are able to recognise people through our Sponsoring Order’s programme. My job is to thank our people regularly on the basis that I know how really how hard it is to do a good job in our sector.
CHP: We see agency use as a common theme amongst many troubled homes. How do you keep your agency usage down?
DH: I have nothing against individual agency workers. The problem is they can’t be really effective. Reluctantly, I would say they are often brought in to complete the numbers on the roster but beyond that in terms of contributing to resident well-being they are really limited in what they can add. Inside the organisation, just like everywhere else, there’s been a big growth in agency over the last two or three years. We are starting to feel like we are turning a corner on it. We are reducing it back down through very targeted reward programmes and pushing our effort on the recruitment side. We do need to tackle nursing specifically. Our agency problem is 50% driven by the market conditions. In Oxfordshire, unemployment is about 0.4% so if you are not far above a NLW payer, and we are a really good payer for the sector, it makes it very hard. The other 50% is about stuff that we can do. That’s about keeping telling people about what social care can deliver and delivering genuine career pathways and working with the public sector to deliver those.
We have to move away from nurse roles that aren’t stimulating and aren’t stretching their qualifications and start to say let’s make the nursing interventions really interesting and challenging and getting colleagues elsewhere to be able to deliver some of those nursing outputs in Nurse Practitioner and Assistant Practitioner roles, which we are looking to develop using the Apprenticeship Levy.
CHP: What level of agency do you have?
DH: Somewhere around 6%.
CHP: Not for profits tend to do particularly well in terms of Outstanding CQC ratings. Why is that?
DH: Not for profits are fundamentally well placed to provide care to the social care sector. But the for-profit operators have really upped their game. Some of the most innovative practices are being delivered at the high end of the for-profits. The for-profit sector is showing what can be achieved at a cost that is far beyond public sector commissioners. What you have to believe in is that some of those innovations will become the norm for our people in the near future.
If there’s lots of money going out to private investment that’s a risk, however, because there isn’t enough money in the sector. You might want to invite some sort of scrutiny of where some of this money comes from. Good care isn’t achievable in a four- or five-year investment cycle. There needs to be some scrutiny of what private equity and hedge funds are in the sector for and how long they are in it for. These models can deliver wonderful outcomes but they are less likely to do that if you are trying to build and sell the business within a period of three to five years. You are risking people having a really negative experience as the services transition.
You have to ask questions in the case of Southern Cross whether it was ever sensible to sign up to those rent escalators. Was it ever sensible to back yourself to achieve 5% fee increases every year to meet the rental demands you had. You have to look inside the organisations and at the funders and say do you understand the volatility of the model?
The CQC are really good in their regulatory role but their powers at the moment only extend to spotting a problem when it comes to oversight. What about having some strong preventative powers? To their credit some of the management information they are sharing is really helpful.
The other risk is being able to explain our case to commissioners. If you are a commissioner in Oxfordshire and you are aware of a private operator delivering substantial profits, if you don’t fully understand the picture, it can be hard to understand the profits they are making and the surpluses provided by an operator like ourselves. That message needs to be communicated. If you are in the part of the sector that is 50% or more publicly funded then you are really going to be struggling but you are doing a really important job. It’s great that the CQC and CMA are starting to say those things because commissioners are going to start to listen. We are starting to see it in some of the fees settlements we are getting, which is heartening. It would be fantastic to be able to say in eight or nine years we want to move back to a 60:40 LA:private split.
CHP: What are your thoughts on the CQC inspection process?
DH: After us, they have the hardest job in social care. They have the job of measuring something that is really hard to measure. I think they have come a long way. They have become an advocate for the sector again. They are way better than they were eight or ten years ago. They are far more thorough and much more willing to talk to you.
Outstanding is pitched at about the right level. It should be hard to get. The one area I would ask inspectors to continue to develop themselves is to remember that the day that they inspect will not be a normal day in that care home because they’re there. The way they behave will give them the best chance to see that organisation in its true light. Some of the questions and some of the approach in terms of how many people arrive and some of the interpersonal skills we observe really take away from the inspection itself. The inspectors have a job to make sure that carers are at ease and to not ask difficult or awkward questions and to ask them in a vocabulary that a carer will use. If they did that, we would all benefit. We have two Outstanding services we are really proud of. On any given day I know we have at least another ten services of the same standard.
CHP: How do you share best practice?
DH: We have a number of forums. We have quarterly RI to Good workshops that are led by our Care Quality Director. We work with homes that are currently RI and talk about the things that have helped people get to Good and things that have helped people get Outstanding. We also have an internal audit process which we try to keep closely calibrated to CQC. We say everybody needs to be at least Good. What we have found is that lots of the things that have taken us from Good to Outstanding have been around a really strong community and strong volunteer activity. That’s where I see us working hard in the next three or four years in order to get Outstanding.
CHP: Will dementia care be your main specialist area going forward?
DH: Clearly it’s been the biggest growth area in terms of working with commissioners and the self-funding market. What we want to do in our dementia services is provide as close to the normal living experience as we possibly can. We work hard to maintain community connections and allow people as much freedom as they would like to live their normal life. We work really hard to keep antipsychotic medication down to less than 3% of our residents. In 2010 it was 10%. A lot of it is about training to understand the person and generating a life that fulfils their interests and passions. We try to encourage people not to be risk averse and some of that is about being more accountable at more senior levels to allow people to live well. We try to give as much freedom as we can and focus on life rather than clinical outcomes.
CHP: What technology do you use?
DH: We are treading really carefully on this one. We absolutely believe in the future for electronic care records and much more assistive technology. We already have a lot of dementia care technology in terms of lighting systems and alerts to try and maintain independence and dignity. We are going through a fairly rigorous assessment of what the next step is. What we’ve realised is this isn’t a technological or care change, it’s a business change. You have to have an IT infrastructure that can safely hold people’s care records and won’t fail for a minute of the day. We are spending a lot of money on reinforcing our infrastructure as well as assessing what the right products are. We have active reviews of incident management, care records and acoustic monitoring, with a view to introducing them in a staged fashion in the next two to three years. In our new builds we are making sure we build for the future in terms of cabling and infrastructure.
One of the problems is there is now a huge variety of these products and it’s about making sure you select the right one that is supported in the right way. I am absolutely convinced that technology takes away current invasive practices. I also believe it provides data we spend a lot of money generating through hands on care. If we can gather that electronically and also free up time, then we are all on to a winner because we can use that time for the life and well-being benefits of residents.
CHP: Are you optimistic about meaningful change coming out of the Green Paper?
There are some more sensible discussions that are going on with local government. There are some more sensible fee settlements coming through. That tells me that the nature of the discussion has changed within central government. We don’t want to see what great care looks like in the paper without the funding question being addressed. I am interested to see how radical it will be. You can’t get away from the fact that we are going to at least have to partly pay for our own care for our old age, most likely many years before we need it. The system we are part of is inherently unfair and so it has to change. You have got to believe that the great advances in technology we are seeing are available to everyone and if they are not you are going to see a big divide. There will always be some variability but the standard level should be good. We need sufficient fee rates to get pay rates well above National Living Wage for providers to be able to genuinely invest in their people and take out the whole turnover issue in social care. If fee rates can address that then you will find everything else lifts. If your turnover is reduced by 5%, your quality ratings will grow by far more than that.
I don’t think they can knock this into the long grass again. I think public understanding is better. Let’s hope that persuades government to do something meaningful. Our sector needs to attract the kind of innovative, excited, aspirational people that will drive change and won’t except the norm but I think it’s happening and I’m really optimistic for the future.
Do you see any potential to go into retirement care?
DH: The retirement village is on our horizon. One of the barriers for an organisation like us is the scale of investment required but it’s important for us to be able to offer something along those lines. I see our work in extra care as our first step. Then perhaps the next step over the next three to five years is to work on a more ambitious project. We have a great facility with Barclays which will help us towards our next development of homes. We are planning two more homes next year – one in the north and one in the south. I think they are the right partner to help us develop something more substantial.