Care Sector Insurance: Why are premiums rising and what can you do to minimise the impact?

As Care homes face a Covid-19 triggered occupancy crisis which could last until 2023, another cloud looms over Social Care providers as their insurance policy renewal dates arise.  

Recent research from The Care Provider Alliance (CPA) reveals that renewal premium quotes have been inflated by as much as 880%. As many providers have yet to reach renewal stage and with a complex variety of insurances available, the exact impact this could have on the sector is yet to be uncovered. 

What are the key issues with Social Care insurance? 

  • Decline in supply – An already small market for insurers is being tightened by a decline in supply. A lack of underwriters willing to provide cover in the present climate also poses a risk of Care Homes not being able to find any cover at all, even with existing suppliers. Currently, there is no indication on what needs to happen to increase the number of insurers willing to provide cover. This places more risk on suppliers who are providing cover and leads to less competition in the market and ultimately, higher premiums. 
  • Refusal to renew – Some insurers are refusing cover to those that have made recent claims, this is higher than usual as some providers have made business interruption claims due to Covid-19. 
  • Exclusions and restrictions – Some insurers are removing Covid-19 cover from their policies and some go as far as to remove cover for any communicable diseases. This is a huge area of concern for the stability of the sector. Other insurers are offering Covid-19 cover but at a very low level, with high excesses and an annual cap on claims. This essentially means that Care homes have no “meaningful cover”.  
  • Access to Data – Insurers are asking for growing levels of data and leaving very little time between offer and acceptance deadlines, making the process more stressful and time consuming for care providers. 

There are now calls for the Government to step in to ensure that both Social Care Providers and Insurers are supported through this period of uncertainty. The NHS was protected early in the crisis by legislation, giving indemnity. Care Sector leaders have called out for an extension of the legislation to cover Social Care, thus far to no avail.  

Don’t wait! What can Care Providers do to minimise the impact of rising insurance costs? 

  • Review your requirements – compile an audit of your current and future organisation set up and needs so you can provide your incumbent and new providers an accurate picture of what to quote against (i.e. your number of homes may have altered, you may now need Cyber cover but not some other cover types, etc.). You do not have to wait for renewal dates – you could identify and deliver savings immediately! 
  • Seek third party support – As Care Sector Procurement specialists, Marr Procurement can support you with added resource and focus to achieve the best deal on your insurance premiums, with access to exclusive leveraged rates and a wide knowledge of the market.  
  • Make cost savings elsewhere – It is likely that you will see some inflation on your renewals and possibly increased risk where your level of cover has decreased, so it is important that you do everything you can to decrease your outgoings in other areas. Marr Procurement can undertake a cost savings opportunity analysis across all or specific areas of your business, such as Medical Consumables (including PPE), Staffing, Energy, IT and Facilities Management. By streamlining processes and costs you can help navigate your way through challenges ahead. 

If you would like to explore how Marr Procurement can help you identify cost savings on your expenditure, please contact admin@marrprocurement.com. 

PPE…What we’ve learned

PPE procurement has never been so challenging.  It has brought out the best and worst in our suppliers and has been the focus of a huge proportion of our team over the last 3 months.  We’ve been riding the PPE rollercoaster along with our Care Sector, Housing Association and Charity clients, and we’d like to share what we’ve learned along the way, in the hope that we don’t have to experience a repeat of such a dire situation in the future.

In this article we’ll be addressing the challenges we’ve face on price and availability and share what we’ve learned along the way.

Price

PPE manufacturers and suppliers have taken full advantage of the increased demand in PPE across the healthcare sector.  Some of the statistics on price inflation we’ve come across are staggering.  Across our Care Sector client buying base the inflation figures on price by category from February to May this year are:

You read it right – 5124% increase on masks!

Whilst this is an example of the economics of supply and demand at work, the price hikes are unsustainable.  We have also been shocked at some of the practices we have come across in some parts of the supply chain.  Thankfully, our experienced team can navigate dealing what one of our team members described as ‘unscrupulous characters’ and we’ve still managed to save money for clients when buying PPE due to economies of scale and our negotiation techniques.  But for many care sector businesses this has been a living nightmare.  One of our clients, Hestia, said this week that “I feel much more confident we can source what we need now that we are working with you.”  The uncertainty and pressure of the last few months expressed in complete relief to have a trusted partner.

It is very clear to anyone that with inflation over 3 months of levels of hundreds if not thousands of percent on PPE pricing, many care sector organisations will rapidly become insolvent.  The COVID crisis is not going away, particularly in the Care Sector, so the long-term use of full PPE is a reality set to stay.  The government must step in to mitigate this issue with extra funding and support.  Scrapping VAT on PPE and the £600 million infection control fund were a step in the right direction but much more needs to be done to both regulate the market and help fund the increase in PPE needs care sector businesses look set to stay with.

Availability

At the beginning of the COVID-19 crisis, the arms race of PPE procurement was like nothing we’ve ever seen.  Due to insufficient supply in the UK, all kinds of organisations from both the UK and abroad were crawling out of the woodwork.  Our usual suppliers hiked their prices up knowing that they were a reliable source for us and a plethora of low-quality PPE flooded the marketplace. 

We are finding now that availability is improving week by week but quality is still an issue.  This is leading to some care homes using the practice of ‘double-gloving’.  Due to lower quality gloves that tear more easily and employees with higher anxiety levels, twice as many gloves are being used than in fact necessary if the correct quality glove is procured in the first place for example.

The production of domestic production of PPE in the UK has finally been ramped up in recent weeks, yet the reliance on international supply is not healthy, particularly from China.

“We have experienced a whole new level of procurement during COVID-19. The rulebook was thrown out of the window as PPE shortages soared.”

Christoph Marr, MD, Marr Procurement

Lessons Learned & Advice

We have learned a lot during the crisis and can share some of the most relevant issues with you here:

  • Buy higher quality and buy once – avoid issues such as double-gloving by buying good quality upfront and providing adequate reassurance and training to staff on the issue.
  • Ask certification before you enter negotiations to save time.  In our experience many new suppliers who approached us claiming to have stock in the UK already were often not trustworthy sources with no certification or in fact no stock in the UK ready to go.
  • We now know which suppliers we trust and can count on – what a short-term view many businesses have taken by not looking after the very organisations that made them the success they are.  Once the dust settles, the sector will use the suppliers who behaved the best in a crisis.
  • Planning ahead – it is now a great time to crisis plan for a future, similar event.  Working out what a reasonable stock-pile looks like in terms of quantities and shelf life could help mitigate future problems should a second spike or different pandemic hit.  Holding a healthy level of stock can also mitigate against future price spikes like the one we’ve just experienced.
  • Go back to your suppliers now that there is more stock available and renegotiate.  You may have to do this weekly until prices drop to healthier levels.  Without having the conversation, the price to your business may stay unnecessarily high.
  • Budget for increased levels of PPE at higher prices for the foreseeable future.  Although the price of face masks for instance is dropping, they’re still not at what we’d call a healthy level.
  • Control the supply chain from start to finish if possible.  With some clients, we actually delivered the product ourselves to ensure this product arrive in time.  Many more agile procurement functions used their own delivery methods to gain ultimate control.  This has seen volunteers, taxi drivers, team members or suppliers across other categories getting involved in distributing PPE and therefore ensuring it arrives when needed.
  • Make sure you’ve accessed the government’s infection control fund.  More details here: https://www.gov.uk/government/publications/adult-social-care-infection-control-fund
  • Use forecasting to estimate usage rates and buy ahead of forecast to ensure all of your sites are well provisioned for.

If you’d like to talk to one of our team about PPE, please get in touch for advice.  Email ppe@marrprocurement.com

Covid-19 – Helping our heroes with 30,000 face masks

As the world faces an extraordinary challenge, we’re focusing efforts towards supporting Charities and Care homes in the fight against Covid-19.

We want to say a heartfelt thank you to our charity and social care heroes. That’s why we’re donating 30,000 face masks to fifteen randomly selected clients – supporting those on the front-line to keep safe and support efforts to tackle the virus. We’re proud to be helping in this small way.

These much-needed supplies will be hand delivered by our wonderful employees who will drive to clients in their own cars, following social distancing guidelines of course.

Clients struggling to get PPE

Many of our clients, including care homes, charities and national housing organisations, are battling – due to unprecedented demand as well as a lack of time and resources – to not only to get hold of essential PPE, but also struggling to get hold of trusted suppliers to order stock at acceptable prices.

There are three million NHS and Social Care heroes in the UK, all of whom are relying heavily on PPE during this crisis. In times like this we should put aside our own personal interests and focus on helping others.

We felt we should give back to our community of amazing clients who have supported the growth of our business over the last five years. That’s why we bought and have donated over 30,000 face masks, most of which will go to our clients who are Charities or Care homes.

We are determined to help those in need to get through this crisis. We are delighted that we can support our clients, in a small way, by donating these much-needed masks to Charities and Care companies throughout the country. As prices soar, with supply not matching demand, we continue to protect our clients’ money and connect them with their much-needed PPE supplies – now and in the future.

We are overwhelmed by the response and urge all partners and suppliers in the Care sector to give something back to the community from which we all benefit.

Patrick Ryan, CEO at crisis charity, Hestia, said: “The biggest thank you to Marr Procurement for your gift of 2,500 face masks for Hestia’s staff so we can continue to keep our Care homes, and supported housing, open and our staff and residents safe.

The current crisis is bringing out the best in people and Marr Procurement’s generosity is further proof of this.”

Who are Marr Procurement?

For those of you who don’t know us, we are a Colchester based procurement specialist and heavily involved daily in supporting the Care, Charity and Housing Association sectors to reduce their costs and be more efficient. This means we already know the market, can leverage trusted supply chains and act as an extended skilled buying arm of our clients. We would be happy to speak to you if you are looking for any advice or support.

If you need any free advice during this time, please do get in touch. Email our MD Christoph Marr if we can help – christoph.marr@marrprocurement.com

COVID-19 Five Care Sector Survival Tips

All businesses and workers in the Care Sector are constantly in our thoughts at the moment. We are seeing unsurpassed levels of ordering of PPE equipment and medical supplies as well as laptops for staff to work from home. The other huge challenge for our clients is agency staffing. Due to illness and some workers choosing to take shifts in supermarkets for instance, there are less agency staff available in the sector, which we anticipate will only continue to decline. We are helping our clients any way we can, even offering to make food deliveries to care homes!

Our fear is that without keeping a lid on costs, we will see care providers go under. This obviously has terrible implications for residents, workers or people receiving home care. Therefore, we will be sharing tips regularly on how to get through this difficult time.

  1. Get in touch with HMRC immediately

They have released a package of measures to help businesses survive this period. These include delaying National Insurance payments, stopping business rates, delaying payment of tax bills and grants. It is vital that you call them now, to find out which you are able to receive. Please see the link below for all residential, home care and supported living organisations:

https://www.gov.uk/government/news/coronavirus-covid-19-guidance-for-employees-employers-and-businesses

Call HMRC directly on their dedicated number tel. 0800 0159 559

Releasing liquidity into your business as soon as you can, will ensure you have the funds you need for essentials such as food, medical supplies and staff.

  1. Follow government guidance for the care sector

Please see the current government advice here:

https://www.gov.uk/government/publications/covid-19-residential-care-supported-living-and-home-care-guidance

The CQC made the following announcement 18/03/20:

“Important information on personal protective equipment for the care sector from

Free distribution of fluid repellent facemasks from the pandemic flu stock started yesterday. Every care home and home care provider will be receiving at least 300 facemasks.”

We will continue to provide updates

  1. Have a team meeting with your procurement staff asap

Although this may not seem to be an immediate priority it is vital that costs don’t spiral. Ensure your team are briefed to make sure you’re not being ripped off by opportunistic suppliers. It is still ok to challenge on costs. Why not approach suppliers proactively to get them onside and in a frame of mind to help you as much as they can.

  1. Read our blog on how to reduce agency costs and retain staff

It’s never been more relevant, and all of the advice still applies. Click here to read the blog.

  1. Use this time to show your staff and clients you care

This will increase loyalty in the longer term.  Measures include:

  • weekly emails to all staff with updates on the situation in your business and how it affects them
  • clear policies on sickness pay and for those who need to take time off if the schools close
  • up-to-date information on your company website
  • money advice for those affected.  The Money Saving Expert is particularly helpful:

www.moneysavingexpert.com/news/2020/03/uk-coronavirus-help-and-your-rights/

 

If you need any free advice during this time, please do get in touch. Email our MD Christoph Marr if we can help – christoph.marr@marrprocurement.com

COVID 19 and Marr Procurement

We are all aware of what extraordinary times we are currently living in. COVID19 is a situation that is currently changing by the hour and as a business we are working hard to ensure no interruption in the services we provide for our clients and to ensure they have our support when they need it. If there was ever a time businesses need help saving money, we’re sure it is now.

Risks

We have done a full risk assessment of how COVID19 may affect our ability to deliver our services to our clients. We have put planned measures in place to mitigate any interruption in our usual level of support. Our team members are fully set up to work from home and we have a number of specialists in each area who can step in should a team member fall ill. We also have clear procedures in place for self-isolation to ensure we do not visit client sites and spread infection.

We will be conducting all meetings via conference call or Microsoft Teams to reduce risk of infection to our team and clients alike.

Ongoing Communication

We will be emailing our clients weekly updating them on the situation we find ourselves in. In the emails you will be told which team members are available for you for that week. We are also asking that clients inform us of any changes in the personnel within their business to ensure everything runs smoothly.

Supporting Our Clients

We want to support our clients through this very difficult time as best we can but this relies heavily on good communication. Our communication channels are accessible and open.  We are also currently working on a new blog to share with clients about ways to save money themselves in these difficult times.  This will be shared soon via email and social media and posted on our website.

Resource

If your business finds itself with a reduction in procurement resource due to illness of team members, please do get in touch as we may be able to help you through this difficult period.

Thank You

On a personal level, we want to thank all care sector providers and their incredible teams for the essential work they are doing caring for such a vulnerable group of people in such difficult times. We are full of admiration for them all.

78% of the Marr team are women!

International Women’s Day 8th March 2020

78% of the Marr Team are women! We think that’s reason to celebrate International Women’s Day here at Marr Procurement!

The theme for International Women’s Day this year is #eachforequal. This is something we live and breathe at Marr Procurement. We’re a team of 19 employees in the business, 14 of whom are women, 11 of whom are mums who wanted to return to work.

Building a team so heavily weighted towards women and women who want to return to work has absolutely been intentional from the outset. Marr Procurement was founded by Christoph Marr 5 years ago because as a Procurement Director he couldn’t find a procurement partner that operated with real capability and with absolute integrity. Christoph and his team have therefore worked hard to create a values led business. The team has gradually grown to 19 people and we have just signed with Jewish Care our fortieth care group.

Christoph said, “Successful and talented women with previously very senior roles in industry who want to return to work after a career break are a hugely untapped resource. These women have had extremely successful careers in finance and marketing and perform at an extraordinary level. So what if they want some flexibility with the hours they work? Their intrinsic DNA of operating as a team is inspiring and above all our clients love the combination of their capability and honesty, hence why I have actively hired them.”

The entire team at Marr are supported by flexible working practices when needed and the supportive approach yields high staff retention levels with only one member of staff leaving over the 5 years the business has been operating. We all embody our key value of integrity.

Consultant, (previously a Chartered Accountant with PwC), and mother of 3, Annabelle Pasco has been with the firm for 3 years. “Working for Marr Procurement has been very refreshing. I was very conscious that some businesses look at working mothers differently, particularly if they’ve taken time out to have a family. But this is not the case here, I’ve always felt valued and supported without question from the outset. We also have fun!”

Sara, (Chartered Accountant, previously Head of Finance and Global Planning at Reuters), who sits on the Marr Procurement Board and has also been with the firm for three years, said: “Having had two children I wanted to get back to work with flexible hours and working at Marr Procurement allows me to combine the career satisfaction I want and still means I can dedicate time to my home life. I also wanted to work in a business that doesn’t do politics and with high standards. More companies should take a leaf out of the Marr Procurement book!”

As the Marr team continues to grow the hiring approach policy remains the same, with the two most recent joiners including Kate Cotterill, Marketing Director and Mum of 3 coming on board.

 

 

How to Reduce Labour Costs

It’s been an interesting time in the care sector as workforce recruitment, pay and retention is challenged yet again for employers. A 6.5% rise in living wage from April on the surface of the announcement sounds like a good thing, which it is of course for the brilliant employees. Yet, is a cause of huge worry for the Care Homes and Home Care suppliers as their spiralling labour costs look set only to increase this year, particularly in light of the COIVID19 crisis. Often overlooked too is the knock-on impact of the living wage on staff whose pay is set above this level. As the living wage rises, so too must their pay if this important ‘differential’ is to be maintained.

 

At Marr we work with a range of Care Homes and labour costs and retention are consistently number 1 on their worry list. We have specialists in our team who focus solely on labour procurement for clients and we’ve tapped into their considerable experience to share our tips on reducing labour costs and staff retention.

 

Reducing Agency Costs

 

  1. Aim to use less temporary labour. Set clear KPI’s on this and measure monthly to ensure sustained focus. Work on staff retention, detailed below, to reduce the need for temporary labour.
  2. Consider switching recruitment agencies rather than sticking to one or working with multiple agencies. Renegotiate your terms with existing agencies, even to make small savings that accumulate over time.
  3. Understand your cost base – what are your temporary staff being paid, and what is the agency receiving? Where could savings be made?
  4. Use technology to automate systems and make processes more efficient. Invest in ways to understand your cost base better – online timesheets are a very effective way to do this
  5. Consider options to convert temporary staff to permanent – most agency agreements will contain specific clauses governing this. After 12-13 weeks it should be free of charge to employ a temporary staff member
  6. Consider working with a procurement specialist such as Marr Procurement. We work closely with agencies to negotiate competitive costs and find economies of scale over time.

 

Retention and Reduction in Sickness Leave

 

  1. Onboarding Stage
    • Improve your interview and vetting techniques to improve the chances of hiring the right person up front.
    • Be clear on what staff will earn as you employee them. False expectations will increase the likelihood they will leave.
    • Assign them a mentor from day 1 to support them.
    • Perfect your induction process.
  2. Support & Mentorship
    • Clear and open communication and support channels should be in place from the moment they start with you. People who feel listened to will not bottle up issues and leave.
    • Managerial training in temporary workforce management is key. It’s a tricky job that requires particular focus on keeping the workforce engaged in your company’s policies and operational style. There’s much that is true in the adage that people leave managers and not companies.
    • Don’t just tick the wellbeing box, make sure employees look after their wellbeing. Work on a workforce wellbeing strategy that’s realistic to implement and measure.
  3. Maintain Engagement
    • Drive employee engagement with strategies in training, mentoring and clear career progression. Make sure every employee is clear on these and is on a documented path with them.
    • Generate a sense of pride in working for your business. Internal marketing is key in making sure that even temporary labour understand what you stand for and how to deliver your way. This should be a key part of your induction programme for all employees temporary or permanent.
    • Develop a recognition and rewards system, deliver on it consistently and use social media to celebrate your temporary and permanent team members.

 

Don’t Forget To Sell The Positives

 

Whilst all of this is going on in the background at a managerial level, make sure you sell the rise in minimum wage as a positive in your internal marketing to your workforce. Showing you care and that you want to educate workers and make sure they know what their new pay levels will be will reflect very well on your business.

 

Can We Help?

 

On average, we save our clients at least 12% on their labour costs.

 

If labour costs are an ongoing issue for your Care Sector business, we’d love to chat to you about how we can help reduce them for you.

 

www.marrprocurement.com

01206 328888

info@marrprocurement.com

Happy 5th Birthday Marr Procurement!

Marr Procurement celebrates 5 years as Care Sector Procurement Specialists

On the 2nd February Marr Procurement Ltd will have been delivering real, audited savings for 5 years in the Care Sector.

Owner and founder of the company, Christoph Marr, started the company because he couldn’t find a procurement partner which truly understood the care sector, shared his values of integrity and had an experienced team.

So, he started Marr Procurement, recruiting a team of highly talented financial, commercial and procurement professionals who were as passionate as he is about working with clients to reduce operating costs in a spirit of openness, fairness and with integrity.

That was 5 years ago. Marr Procurement works across the health and care sector and has worked with organisations like Virgin Care, Care UK, The Salvation Army, The Practice Group, Anchor Trust, Yeovil NHS Trust and has worked with 40 housing associations, health and care groups over the 5 years.

Having sourced over £500m of goods and services and competed more than £350m in temporary agency spend to date, Marr leverage formidable purchasing power on behalf of our clients. The financial pressures on health and care operators have never been greater and the results they have achieved for their clients demonstrate that they can deliver a real difference to the bottom line without compromising on care and on quality.

Christoph Marr is incredibly proud of the work he and his team have done to date and says, “I’ve got an amazing team around me that continues to grow rapidly and who are constantly striving to deliver sustainable savings to our client base. Our huge focus across the business is our values, which I think is what sets us apart. Integrity and trust are embedded in everything we do.”

Marr’s 5th birthday celebrations are topped off perfectly by winning their 40th client from the Care Sector. They’ve just started working with Jewish Care who say of Marr:

“Jewish Care are delighted with the professional procurement support that we have received from a care sector procurement expert that operates with real integrity, clarity, and expertise. For this reason I wholeheartedly recommend Marr procurement!”

Happy 5th Birthday Marr Procurement!

The Care Sector Workforce Crisis…how to retain staff and manage cost

It’s been an interesting few weeks in the care sector as their workforce is challenged yet again. A 6.5% rise in minimum wage from April on the surface of the announcement sounds like a good thing, which it is of course for the brilliant employees. Yet, is a cause of huge worry for the Care Homes and Home Care suppliers as their spiralling labour costs look set only to increase in 2020.

At Marr we work with a range of Care Homes and labour costs and retention are consistently number 1 on their worry list. We have specialists in our team who focus solely on labour procurement for clients and we’ve tapped into their considerable experience to share our tips on reducing labour costs and staff retention.

Reducing Labour Costs in 2020

1. Aim to use less temporary labour in 2020. Set clear KPI’s on this and measure monthly to ensure sustained focus. Work on staff retention, detailed below, to reduce the need for temporary labour.
2. Consider switching recruitment agencies rather than sticking to one or working with multiple agencies. Renegotiate your terms with existing agencies, even to make small savings that accumulate over time.
3. Use technology to automate systems and save money on labour.
4. Conduct a full review of your current temporary labour and analyse if some can be made permanent.
5. Consider working with a procurement specialist such as Marr Procurement. We work closely with agencies to negotiate competitive costs and find economies of scale over time.

Retention and Reduction in Sickness Leave

1. Onboarding Stage
• Improve your interview and vetting techniques to improve the chances of hiring the right person up front.
• Be clear on what staff will earn as you employee them. False expectations will increase the likelihood they will leave.
• Assign them a mentor from day 1 to support them.
• Perfect your induction process.
2. Support & Mentorship
• Clear and open communication and support channels should be in place from the moment they start with you. People who feel listened to will not bottle up issues and leave.
• Managerial training in temporary workforce management is key. It’s a tricky job that requires particular focus on keeping the workforce engaged in your company’s policies and operational style. There’s much that is true in the adage that people leave managers and not companies.
• Don’t just tick the wellbeing box, make sure employees look after their wellbeing. Work on a workforce wellbeing strategy that’s realistic to implement and measure.
3. Maintain Engagement
• Drive employee engagement with strategies in training, mentoring and clear career progression. Make sure every employee is clear on these and is on a documented path with them.
• Generate a sense of pride in working for your business. Internal marketing is key in making sure that even temporary labour understand what you stand for and how to deliver your way. This should be a key part of your induction programme for all employees temporary or permanent.
• Develop a recognition and rewards system, deliver on it consistently and use social media to celebrate your temporary and permanent team members.

Don’t Forget To Sell The Positives

Whilst all of this is going on in the background at a managerial level, make sure you sell the rise in minimum wage as a positive in your internal marketing to your workforce. Showing you care and that you want to educate workers and make sure they know what their new pay levels will be will reflect very well on your business.

Can We Help?

On average, we save our clients at least 12% on their labour costs.

If labour costs are an ongoing issue for your Care Sector business, we’d love to chat to you about how we can help reduce them for you.

www.marrprocurement.com
01206 328888
info@marrprocurement.com