1. Open Book Accounting In Adult Services within the Birmingham Social Care Market 21 January 2015 Jennet Hartrick- BCC Charlie Whitworth- KPMG

2. Agenda BCC Current Position What’s Different about Open Book Accounting in Adult Services in 2015? KPMG Introduction to KPMG - CW Methodology and Process - CW BCC & KPMG Q & A

3. Current Position Open Book Accounting 2 –Focussed primarily on Older Adults Residential Care Market –Has resulted in price stability in that market A time of change –Care Act 2014 –Separation of Care and Housing Costs A time of opportunity –For further engagement –For price stability across the whole of the market –To move focus away from ‘price’ to ‘quality’

4. What’s Different about Open Book Accounting in Adult Services in 2015? Additional analysis on Open Book Accounting 2 in order to identify and separate out ‘Care’ and ‘Hotel’ costs for both Older and Younger Adults Residential Care Younger Adults Residential Care – consult with a selection of providers and to develop alternative pricing models which could include: a price banding structure linked to outcomes; and/or an enablement approach where the price reduces over time; and an assessment of whether to offer a specialist hourly rate New open book exercises across the markets for Younger Adults Home Support and Supported Living and Housing with Care (“Extra Care”) Develop a methodology to take into account future changes in the main cost drivers and therefore future proof the process for establishing fees

5. Introduction to KPMG Charlie Whitworth

6. Key Principles KPMG have done this before! One of the ‘Big 4’ accountancy firms Professionalism KPMG will work at ‘arms length’ Will produce ‘evidence based analysis’ from data gathered Independence

7. Key Principles We will discuss approach and share output We will have the evidence for every assumption and result Transparency Our tools have been refined through previous work KPMG will be on hand to support and validate the data Engagement and Support

8. KPMG’s Role Creation of questionnaire’s and reporting tool’s Managing independent data gathering process Supporting Providers, particularly technical questions! Validating Provider responses Consolidation, aggregation and analysis of data Independent reporting of findings

9. Objectives We have 3 key aims for data gathering and analysis which will be covered in the questionnaire: 1.Understand actual local costs of care and ‘hotel’ costs, including staff and non-staff costs 2.Understand local and national ‘context’ of these costs e.g. What are the challenges and pressures affecting costs, both now and expected in the future? 3.Understand occupancy, capacity and future service plans of the local market

10. Process Stages We will follow the steps below to establish the local cost of care for Birmingham bed-based provision. StageActivitiesTiming 1. Design approach and outcomes (scope) Create questionnaire, pilot with small group of Providers Complete by Friday 14th February 2. Gather DataSend out questionnaire for completion to all Providers 1 month, Complete by 7th March 3. Perform Analysis KPMG check data, group data, anonymise, and develop cost structures 7th March until end of March 4. Validate with market Share findings with providers (participation rates & ‘aggregated’ data) Early April

11. The Questionnaire - Principles Cost data should reflect local market dynamics & structure Minimise use of industry / national averages and assumptions – local data is critical Grouping questions will be asked and used to segment data – home size, care type, locality Maximum coverage - sent to all properties Not a lengthy process – proposed 3 weeks to respond

12. The Pilot We are seeking a small group of providers to undertake a pilot. This is critical to:  ‘Tailor’ the questionnaire to the local market (it is based on working with Providers elsewhere);  Ensure the questionnaire is easy to understand (e.g. local terms and phrases);  Ensure the questionnaire process is reasonable (e.g. time allowance); and  Ensure that questions are relevant and comprehensive. From this we can ‘fine tune’ any potential areas of confusion, and add or remove questions as required.

13. The Data Gathering Period Engagement StepProposed Timing Questionnaire sent to providersw/c 16th February Ongoing support, calls, updates, FAQs and visits if required 16th February to 7th March Closing of response period7th March Data analysis and clarification of any outstanding questions with homes 9th March onwards

14. Confidentiality – 4 Stage Process 1.On receipt by KPMG, your questionnaire is manually validated. 2.Your questionnaire is uploaded into a database and all identifying data in the tool is removed (property/provider names, contact details, second part of postcodes). 3.At the end of the data gathering process all responses (written and email) are destroyed. 4.We will write to all providers to confirm the destruction/deletion of all data. All data will be treated as confidential. It will not be possible to identify individual homes either in the dataset or in the report.

15. Sharing The Output This will be transparent – we will share summary information with you, as received. A report outlining the costs of operating care homes in the Birmingham area will be shared with all Providers. This report will clearly state the sample size, approach to data analysis (e.g. averages), any exclusions and assumptions made. There will not be a direct link made between this report and fee levels. There will be no reference to individual, identifiable homes in this report.

16. Need Help? We will provide as much support as is required. 1.Today's sessions. 2.Development of ‘FAQ’s. 3.Calling a sample of Providers on a daily basis. 4.Visiting Providers if additional support is required. 5.Providing a help number / email for queries. 6.What else? Please help us by taking part!

17. Q & A