Some legal challenges
Since October 2014 individuals eligible for NHS continuing healthcare, and children and young people’s continuing care, have had the right to have a personal health budget (PHB).
This right was extended to individuals in receipt of aftercare under section 117 of the Mental Health Act and for wheelchair budgets in December 2019.
Ensuring more people can benefit from personalised care is one of the main aims of the NHS Long Term Plan and this includes the ambition to increase the uptake of PHBs to 200,000 people by 2023/24. Latest data indicates that by the end of September 2022, just under 112,000 people have received a PHB in England.
The aim of PHBs is to provide autonomy and person-centred care. There is a focus on outcome rather than need, and on giving individuals control over their own care. This recognises that, in particular, individuals with long term conditions are experts in the management of their own condition. Further, having control over care packages allows the patient to live more independently, which can greatly improve their wellbeing.
There are limits however and the situation can create legal risks for an ICB. The risks are heightened with the direct payment form of PHB, and particularly when the budget holder (patient or their representative) is acting as employer.
Direct payments – the challenges
The ICB remains ultimately legally responsible for ensuring that an individual receives safe care, which can mean having to step in if a care package collapses, even if the ICB has already provided the budget to the patient or their representative to manage. The legal framework provides ways for the ICB to recover its monies in this scenario, or in the event that monies have been misused, but this may not always be possible.
ICBs must ensure that they have adequate processes in place to ensure that they meet their own obligations to give direct payments as much chance as possible to succeed. For example, the ICB must ensure that it provides information, advice and support to the person to whom direct payments are made, including in relation to their responsibilities as an employer.
ICBs need to ensure that the budget includes enough money for the individual to meet their identified health needs. This needs to be considered on a case by case basis and not set at arbitrary levels. For example, if the ICB sets a personal health budget based on a person’s expected quantity of continence products, as would have been provided by the NHS, it must be satisfied that this amount is sufficient to enable the purchase of the products in the open retail market so as to meet someone’s identified continence needs.
The care co-ordinator role is also important to ensure successful delivery of direct payments. A care co-ordinator should be allocated to every person receiving a direct payment. Their role includes acting as a point of liaison between the ICB and person receiving the direct payment and arranging for monitoring and review of the direct payment.
With a patient established as the employer of their carer, using direct payments, there can be particular problems if things change and the patient loses capacity to make the relevant decisions about their care or their role as an employer, leaving a complex tangle of issues under the Mental Capacity Act, in relation to the patient’s own best interests, the rights of the employee, and the responsibilities of the ICB overall.
Ending a direct payment
There are circumstances in which an ICB can decline to provide, or stop providing a direct payment. Not all patients or their representatives are suitable to manage public monies in this way. The ICB may decide not to provide someone with a direct payment if it considers:
- the person/representative would not be able to manage the payment;
- it is inappropriate given their condition or the impact on that person of their condition;
- the benefit to that person does not represent value for money;
- providing services in this way would not provide the same or improved outcome; or
- payment would not be used for the agreed purposes.
The individual should be informed, in writing, with reasons if this is the case. If direct payments are unsuitable, the ICB should consider whether another form of personal health budget (notional budget or third-party budget) might be suitable.
Employment law considerations
An individual in receipt of a direct payment is responsible for engaging their own staff to help provide the necessary care and support. If staff are employed (rather than engaged via an agency) the individual acquires the whole raft of employment liabilities and responsibilities that go with an employment relationship. These will include obligations to meet minimum wage thresholds, annual leave entitlements as well as parental leave and discrimination protections to name a few.
However, in circumstances where the direct payment arrangement stops or breaks down the ICB might find itself inheriting liabilities for the staff from the individual if it assumes responsibilities again for the individual and their care. This could include financial liabilities for redundancy costs and any other payments or claims that arise on the expiry of the employment relationship. The TUPE (Transfer of Undertakings Protection of Employment) Regulations might also apply to the transfer of staff from a direct payment to another care model depending on the circumstances and whilst the ICB might not have any direct responsibilities for any liabilities under TUPE the ICB will be interested to know that the process flows properly to ensure the seamless delivery of care.
It is sensible to ensure that terms are agreed at the outset of any direct payment arrangement to cover these eventualities. The ICB might insist that the individual puts in place suitable employer liability insurance to cover any financial claims pursued by an employee against the individual or any successor to the direct payment arrangement. Advice should be sought to ensure that both the employment contract and direct payment agreements are suitably robust.
Top tips for managing PHBs and direct payment
- Provide good quality support for individuals and their representatives, including through a care co-ordinator
- Ensure the budget is set at an appropriate level
- Review policies and direct payment agreements to ensure that they reflect the legal obligations and powers of the ICB
- Consider declining or ceasing direct payments in appropriate cases
- Use other forms of PHBs such as notional budgets, or third-party managed budgets when direct payments are not suitable
How we can help
Our specialist team has experience of advising commissioners in relation to PHB and direct payment policies and direct payment agreements. We can assist in the review of policies to ensure consistency across the ICB. We are also experienced in providing support in decision making around PHBs and direct payments, ensuring that commissioners make decisions that are lawful and defensible, including support with Judicial Review claims. Our integrated team has expertise in relation to public law, Mental Capacity Act and Court of Protection as well as employment law, providing comprehensive legal support for the full range of legal questions that may arise.
For further information please get in touch.
For further information, please contact:
Joanna Crichton, Hill Dickinson
joanna.crichton@hilldickinson.com
