NHS fees for care homes to fund nursing services will rise by 7.7% in 2025-26, the government has announced.

The increase in NHS-funded nursing care (FNC) will benefit more than 75,000 care home residents in England, said the Department of Health and Social Care (DHSC).

FNC is designed to fund services provided to care home residents by a registered nurse involving either the provision of care, including performing procedures or administering medicines, or the planning, supervision or delegation of such care.

The latest rise, which follows a 7.4% increase last year, will take the standard rate of FNC from £235.88 to £254.06 per week from 1 April 2025. The higher rate, paid to the relatively few residents who received it when the three previous bands were merged in 2007, will increase from £324.50 to £349.50.

Independent providers’ umbrella body Care England said this was the tenth year in which it had worked with the department to ensure that FNC increases reflected the rising costs of care faced by providers.

‘Threat to sustainability of social care nursing’

However, while its chief executive, Martin Green, said that the 2025-26 increase was “a step in the direction”, he warned that the “sustainability” of nursing in social care settings was under threat.

This was as a result of the upcoming rise in employer national insurance contributions – expected to cost providers in England £940m in 2025-26 – and the “shrinking wage gap” between care home nurses and lower-paid staff, due to above-inflation rises in the national living wage.

Care England chief executive Martin Green

Green also referred to the “increasing burden of delegated healthcare tasks”, under which nurses train and supervise care workers to carry out healthcare tasks, such as injections.

He said the rise in the FNC needed to be followed by integrated care boards increasing the rates they pay social care providers for NHS continuing healthcare (CHC) by at least the same amount. CHC involves the full funding of a person’s health and social care by the NHS on the grounds that they have a “primary health need”.

Green added that, without such a rise in CHC rates, “we risk a system where providers simply cannot afford to provide nursing care, which will add to hospital discharge challenges”.

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The fee paid to care homes to fund nursing costs will rise by 7.4% from April 2024 in what leaders have described as a “in for the sector”, the government announced today.

The standard weekly NHS-funded nursing care (FNC) rate will rise from £219.71 to £235.88, while the higher rate will increase from £302.25 to £324.50, said the Department of Health and Social Care (DHSC).

The higher rate is paid to the relatively few residents who received it when the three previous bands were merged in 2007.

The DHSC said the scale of the increase had been based on data supplied by social care providers on their costs, which had then been quality assured.

‘Win for the sector’

Care England, which represents independent providers, hailed the increase, which follows rises of 5% in 2023 and 11.5% in 2022, as a “win for the care sector”.

“Care England has worked tirelessly with the Department of Health and Social Care over nine years to ensure that the FNC rate reflects the true cost of providing nursing care,” said chief executive Martin Green.

“This latest uplift represents a win for the care sector operating in a challenging time and is a testament to our collective efforts.”

About funded nursing care

Funded nursing care is designed to finance services provided to care home residents by a registered nurse involving either the provision of care or the planning, supervision or delegation of the provision of care.

It is paid to care homes in England by NHS integrated care boards (ICBs) as, under section 22 of the Care Act 2014, registered nursing costs generally cannot be met by a local authority.

However, Green warned that the legal position on FNC needed to be reviewed in the light of the increasing complexity of needs met by residential care homes.

“The government must now lend consideration to the legal definition of FNC to ensure its fit for the future given the increased levels of complexity seen in residential care, and how care providers have had to adapt their services to meet the ever-changing needs of their residents,” he said.

‘Need to reward and recognise social care nurses’

Green also stressed the importance of care home nursing staff being “recognised and rewarded accordingly, in line with NHS nurses”.

Care homes have struggled to retain nurses in recent years, with the turnover for adult social care nurses hitting 44.9% in 2021-22, before falling to a still high 32.6% in 2022-23, according to Skills for Care data. This was far higher than the turnover for NHS registered nurses and health visits at the same time (10.9%).

However, separate Skills for Care data has shown vacancy rates for registered nurses falling, from 11.3% in March 2023 to 8.2% in January of this year.

NHS payments to care homes to fund nursing will rise by 5% for 2023-24, the Department of Health and Social Care announced yesterday.

Standard funded nursing care (FNC) weekly payments will rise from £209.19 to £219.71 from 1 April, with the very few residents on the legacy higher rate seeing an increase in their payments from £287.78 to £302.25 per week.

The FNC funds either the provision of care, or the planning, supervision or delegation of such care, by registered nurses in care homes.

The DHSC said the rise, which follows an 11.5% hike in the payments last year, was “based on adult social care data which is quality assured and independently verified”.

The 2023-24 rise is in line with the 5% pay increase offered to nurses in the NHS for 2023-24 and is also similar to the government’s projection for the rate of inflation – according to its preferred consumer price index measure – for 2023-24, of 5.5%.

As of March 2022, pay for registered nurses in care homes averaged £34,800, which was within the range of band 6 for senior or specialist nurses working in the NHS, which was £32,306 to £39,027 at the time, according to Skills for Care data.

High turnover

However, care homes have experienced significant challenges recruiting and retaining nurses in recent years. Skills for Care figures show that 44.9% of nursing home nurses (around 12,000) left their posts in 2021-22, compared with a turnover rate of 10.9% for NHS nurses and health visitors.

In addition, 14.6% of social care nursing posts – most of which are in care homes – were vacant as of March 2022, the highest for any social care role, while 18,500 filled nursing posts had been lost to the sector in the preceding decade, equivalent to 36% of the total in 2012-13.

As of January 2023, the vacancy rate for social care nurses was 13% among those providers that had submitted data since March 2022, above the adult social care average (10.9%), but in line with that for care workers (13.1%).