Adult Social Care Providers EU Exit Planning Update

On the 9^th October Jonathan Marron, Director General of Community & Social Care shared a letter with adult social care providers via CQC setting out actions to help adult social care get ready for Brexit on 31 October 2019.

The letter sets out steps the Department of Health and Social Care (DHSC) has been taking to get ready for Brexit on 31 October 2019, and to provide some practical information on what adult social care providers can do to support their preparations.

The DHSC’s approach to continuity of supply for adult social care has followed the same principles as their contingency approach for the NHS but seeks to recognise that the structure of the adult social care market is fundamentally different to the NHS and that there are therefore differences. The DHSC states that for medicines, clinical consumables and medical devices, their stockpiles cover people within both the NHS and the adult social care system. For non-medical supplies, they have been working with major suppliers on their contingency plans regardless of whether they supply directly to NHS services or adult social care providers.

The DHSC have recommended that adult social care providers take the following steps which continue to be in line with existing guidance for the adult social care sector:

Medicines, medical products, food and other goods and services 

• Check with their local suppliers about their contingency plans in the case of disruption – e.g. food suppliers
• Update their business continuity plans accordingly to prepare for any disruption
• Do not stockpile any medicines or medical products. The DHSC say the Government has been working directly with suppliers and pharmaceutical companies to help ensure there is a continued supply of medicines and medical products such as syringes, wheelchair parts and incontinence products to the UK if the UK leaves the EU without a deal. Based on this the DHSC says there is no reason for providers to stockpile any medical products or devices.
• If providers have any maintenance of machinery or equipment (e.g. lift services) due in the next few months, consider bringing this forward before 31st October, if their contractual / leasing provisions allow, where providers think there may be an EU touchpoint – e.g. lift parts that come from Germany
• Review their contracts with suppliers to identify any potential Brexit issues

If providers experience a disruption the DHSC are recommending:

1. For medicines, providers should continue to manage medicines supply issues as per their current processes. Providers should continue to report any issues via their community pharmacist who should know the latest on any supply disruptions. 
2. For medical devices and clinical consumable products, in the first instance providers should follow any business as usual processes. In practice, this means checking with the supplier or where relevant, with other branches in their organisation, to make alternative arrangements. In the event of any disruption, providers are also recommended to consider if alternative products are available.
3. For food providers should consider developing flexible menus to compensate for any shortage of specific ingredients or food items. Substitutions should reflect the Government’s nutrition advice to ensure providers continue to provide a balanced diet to those in their care. This guide can be accessed online at: https://www.gov.uk/government/publications/the-eatwell-guide           

The DHSC has established the National Supply Disruption Response (NSDR). This will include a 24/7 call centre that will coordinate between suppliers, health services, adult social care organisations and central Government. It will specifically monitor the supply situation and coordinate actions to address supply disruption incidents that occur after Brexit where normal procedures are unable to provide a resolution and offer logistics trouble-shooting to suppliers whose consignments are stuck in border disruption.

Workforce and service users

• Encourage their employees and the people receiving their services to consider whether they should apply for the EU Settlement Scheme

Contract Management

Providers should: 

• contact their local authority to identify relevant Brexit leads (this may include providers’ Director of Adult Social Services and/or Brexit Lead Officer). 
• make contacts across their region or local area to share best practice and ways of working ahead of 31 October. Essential individuals/organisations could include providers’ local Association of Directors of Adult Social Services (ADASS), Local Government Association (LGA), local care regulator, local authority commissioners, NHS partners, trade body associations, or local care associations. 
• stay abreast of any local or regional adult social care events which may be taking place in a provider’s area to offer guidance and support on how to prepare for the UK leaving the EU.

DHSC’s general advice is that, given the market has been aware of Brexit and its potential implications for some time now, organisations may wish to consider limiting their response to any contractual performance or pricing issues raised. Requests to increase pricing should be underpinned by evidence of the additional costs being incurred, and organisations may wish to consider limiting additional payments to those exceptions that sit outside of the normal balance of risk assumed by the contract.

A point well made by the DHSC is that contractual positions with respect to force majeure will depend upon the circumstances and relevant contract clauses in each case. In most cases, however, it will be difficult for suppliers to make a case for relief of performance (under force majeure provisions) or frustration of contract as the likely consequences of Brexit have been widely aired in public for some time – and accordingly suppliers have had ample time to plan for the continuation of service, and the performance of contracts should still be possible in most cases.

In relation to contracts, providers should consider: 

• reviewing the position with respect to their specific operational requirements with suppliers
• reviewing their contracts with suppliers to identify any potential Brexit issues (particularly if the UK leaves the EU without a deal).
• their ability to make use of additional or alternative suppliers where contractual performance may be at risk.
• a pragmatic approach to the performance management of Brexit related issues, potentially recognising suppliers’ efforts to maintain continuity through substitution etc. by (for example) providing temporary relief from specific performance measures.
• whether they need to seek legal advice with respect to specific contractual queries or risks  

Monica Macheng, Partner and Lead on Social Care, Bevan Brittan LLP

Monica is an experienced corporate lawyer advising a diverse client base ranging from of SMEs to listed companies on corporate projects of all sizes across a number of sectors including social care. Monica advises on all corporate matters including mergers and acquisitions, disposals, exit strategies, private equity transactions, transaction due diligence, joint ventures, reorganisations and demergers, corporate structures and company law compliance issues including, establishing companies, LLPs and partnerships, changes in constitution or governance and the roles, rights and duties of directors, shareholders and LLP members.