Drivers of home care agency closure: evidence from England

Stephen Allan

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: Context: Hundreds of thousands of people in England with long-term care needs are supported by more than 10,000 home care agencies. However, little is known about the market dynamics of home care supply, either in England or internationally. Objective: To understand the reasons for home care agency closure in England. Method: Regression analysis of the future status of home care agencies open in the period 2015–2017 using a panel dataset of 98% of all agencies registered to provide care in England. Measures of quality, competition and other local area demand and supply factors, e.g. population, needs and rurality, were included in the analysis. Instrumental variable methods were used to address endogeneity in the relationship between closure and both competition and quality. Findings: Fourteen point two per cent of home care agencies had closed one year after observation, with some differences observed by region. Regression analysis confirmed that higher competition and lower quality significantly increased closure likelihood. A new agency locating immediately next to the average provider would increase the likelihood of closure of the existing agency by a quarter. Independent agencies and those which supported a local population with higher needs had significantly reduced chance of closure. Limitations: There were data limitations to the analysis, with no information on size of agencies and assumptions made on where they delivered care. Implications: Competitive effects in home care markets must be carefully considered given the importance of ensuring equitable access to care. The findings also confirm the importance of quality regulation in long-term care.

Keywords: competition; quality; home care; business; closure (search for similar items in EconPapers)
JEL-codes: J01 R14 (search for similar items in EconPapers)
Pages: 14 pages
Date: 2024-03-07
New Economics Papers: this item is included in nep-age and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations:

Published in Journal of Long-Term Care, 7, March, 2024, 2024, pp. 139 - 152. ISSN: 2516-9122

Downloads: (external link)
http://eprints.lse.ac.uk/122544/ Open access version. (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:122544

Access Statistics for this paper

More papers in LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library LSE Library Portugal Street London, WC2A 2HD, U.K.. Contact information at EDIRC.
Bibliographic data for series maintained by LSERO Manager ().