Measuring regional variation in the productivity of care home in England

Productivity growth in residential and nursing care is measured by comparing annual change of total amount of output of the services to annual change of total inputs. Monitoring productivity growth in care home is important so that policy makers are able to understand whether public spending has achieved ‘value for money’. While previous studies in the field pay little attention on the quality of the services, which is considered as an important element in the provision of adult social care (ASC) services, this paper seeks to introduce a more robust productivity measure in ASC by taking into account the quality of services using the Adult Social Care Outcomes Toolkit (ASCOT). ASCOT is adjusted using a regression-based method which account for clients’ need and other regional characteristics. We measure regional variation in the productivity of care home in England by using data from Personal Social Services Expenditure and Unit Costs (PSSEX1) and Adult Social Care Survey (ASCS) of 2010 to 2012. We found that the amount of residential and nursing care provided to older people from 2010 to 2012 increased, while the quality of care for older adults increased from 2010 to 2011, and decreased from 2011 to 2012. Our quality adjustment methods show small but significant impacts on output growth in some regions, which justifies the use of quality indicators on measuring output of services. In terms of productivity growth, productivity growth increased for most regions from 2010 to 2011, and fell for most regions from 2011 to 2012.