Thread by @CorletWalker

Are markets the right way to deliver #SocialCare? Very excited to share our new piece in @LancetLongevity exploring how market logic has failed service users in the UK, US, Aus & Sweden over the past 30 yrs & what’s next. A long 🧵

bit.ly/36dvW0b

@CUSP_uk /1

Neoliberal market logic has worked its way into the welfare policies of many countries, under pretence of improving efficiency & service quality.

It's core principles are:🥇Competition,👥Consumer Choice, & 💰 Profit Motive. But they don't quite work as expected in social care /2

The dynamics are complex & Twitter is a tough medium to communicate nuance, but I’ll try to do justice to the key arguments @ProfTimJackson @ADruckman and I developed for how & why these principles lead to dysfunctional outcomes in the care sector /3

First, counter to prevailing theory,🥇Competition has been found to drive DOWN quality of care.
sciencedirect.com/science/articl…

Why? There are two parts to this puzzle: 1) Care work is time-intensive so attempts to improve labour productivity tend to reduce care quality /4

2) Governments who purchase services on behalf of a lot of service users generally have the market power to set prices unsustainably low & have been found to do so in many countries, including Australia, the UK, and US /5

In this context, providers have few options when responding to increased competition.

Add profit to the mix & staff wages find themselves competing with shareholder returns for an increasingly slim margin.

Unsurprisingly shareholders are generally winning that fight /6

For markets to do their magic, not only do providers need to be able to respond to competition, but consumers do to.

We argue that this isn't the case in social care, and that 👥Consumer Choice therefore cannot be relied on to drive improvements to service quality /7

To be clear, we agree that individs & their fams are best placed to choose who delivers their care (big no to paternalistic welfare policies thnx). But markets rely on the existence of well-informed consumers who 'vote with their feet’. There are 2 reasons this doesn’t work /8

1) Widespread lack of access to accurate info abt price & quality. Recent report on Aus care system found the info on their Aged Care website to be “inconsistent and incomplete”. Same can & has been said for many other care systems.

agedcare.royalcommission.gov.au /9

2) Care consumers are ‘sticky’. If you buy a rubbish pen, you'll just choose a different brand next time. But moving between care homes can lead to a raft of -ve physical & psychological impacts, so ppl are unable to act on their prefs among providers w/o sig. personal risk /10

These power imbalances allow for-profit providers to make changes that enhance their profitability, even where this is at the expense of care, without losing customers at the pace you might expect. This dynamic exposes residents to poor/ declining quality care /11

Last, privatisation & the introduction of the 💰Profit Motive opens the door to predatory financing. This is, IMO, the most compelling reason to move away from care markets.

Private equity firms own some of the largest care providers in Europe & US /12

bit.ly/3isNyrg

These investment firms have a proven track record of using risky financing techniques such as debt-leveraging & moving profits offshore to achieve the desired return for their investors.

We looked at this for the UK last year: cusp.ac.uk/themes/aetw/wp… /13

Some of these tactics are associated with a HUGE increased risk of bankruptcy & have *nothing* to do with improving care quality or wages.

They also drain funds from services to pay for dividends, rents, & debts.

Check out: bit.ly/3qNrUCP & bit.ly/3ulkVBM /14

If you’ve stuck this far, then here’s the crux: **These Problems Are Not Theoretical**

Carers across the OECD are overworked & underpaid.

Care quality is lower in for-profit (esp. financialised) care homes than in non-profit.

Markets are clearly not delivering as promised /15

So what could we do instead?

Short-term recs: strengthen workers’ rights to prevent them from being a squeeze point; find methods that can complement consumer choice to improve care quality (e.g. co-production of services); rein in financialistion (bit.ly/3DadD88) /15

Long-term recs: Take profit out of the mix entirely & make an ideological shift away from neolib welfare policies.

New policy directions will be country-specific & must clearly be based on the views of workers & service users, rather than those of investors & profiteers /END

Particular thanks to @rn_harrington, @_AmyHorton, @stvallan, @DianeJBurns, among others, for their ongoing work on the topic, which inspired this piece!

New @LancetLongevity article exploring why social care markets don’t work: bit.ly/36o1Zu6 - of policy interest to @CQCProf, @appg_L2G, @ASCAPPG, @HLAdultCare, @natalieben, @labourlewis, @Jeremy_Hunt.

This also hopefully has some useful implications for how (& how not) to build social provisioning systems that meet our collctive care needs in a postgrowth context @KateRaworth @AndrewLFanning @g_kallis @JKSteinberger @mmbuchs