Personal Budgets and Direct Payments

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1 Personal Budgets/Direct Payments Date of resource : April 20 Page 1 of Learning Aims The learning aims of this briefing are to enable you to 1 Understand how personal budgets can be requested for special educational, health care and social care provision; 2 Understand the circumstances in which direct payments will be available for such provision, including where the provision is specified within an Education Health and Care plan ( EHC plan ); 3 Understand the limitations on obtaining a personal budget in respect of each type of provision and the limitations on the use of direct payments to pay for the provision within an EHC plan. Level: Intermediate 1. Introduction Personal budgets and direct payments were introduced as a way of increasing independence and choice for individuals by giving them control over the way in which services that they receive are delivered. Direct payments have been available to young people and parents of children with SEN and disabilities for some years to pay for social care provision. Rights to personal budgets and direct payments for health care provision have also been introduced relatively recently. The new feature of the Children and Families Act 2014 was the introduction of personal budgets for the provision specified within the plan, (including the special educational provision) and the possibility of direct payments for the special educational provision specified in the plan. This briefing considers the way in which personal budgets and direct payments can be sought for each of the types of provision which can be specified within an EHC plan, and also considers the potential limitations of such direct payments being used to pay for the provision within the plan.

2 Page 2 of 2. Law Statute: The Children and Families Act 2014 ( the C & F Act 2014 ) section 49 deals with Local Authorities duties to prepare personal budgets in respect of provision specified within an EHC plan, as well as direct payments. The National Health Service Act 2006 ( the NHS Act 2006 ) section 12A gives the power for direct payments to be made in respect of health care provision. The Care Act 2014 ( the Care Act ) sections 26, 31, 32 and 33 set out the rights to obtain personal budgets and receive direct payments for young people over 18 who are eligible for provision to be made for their social care needs. The Children Act 1989 ( the Children Act ) section 17A places a duty on Local Authorities to offer direct payments to those with parental responsibility for disabled children who are receiving social care provision from children s services. Regulation: The Special Educational Needs (Personal Budgets) Regulations 2014 ( SEN (PB) Regs ) deal with personal budgets and direct payments in respect of special educational provision within an EHC plan. The Special Educational Needs (Miscellaneous Amendments) Regulations 2014 ( the SEN (PB) Amendment Regs ) amended the SEN PB Regs. The National Health Service Commissioning Board and Clinical Commissioning Group (Responsibility and Standing Rules) Regulations 2012 (as amended 1 ) ( the NHS (RSR) Regs ) give the right to have a personal health budget for those receiving NHS continuing healthcare. The National Health Service Direct Payments Regulations 2013 (as amended) ( NHS (DP) Regs ) give the power to make direct payments for health care provision. 1 The National Health Service Commissioning Board and Clinical Commissioning Group (Responsibility and Standing Rules) Regulations 2012 dealt with a wide range of matters relating to the functions and commissioning responsibilities of the National Health Service Commissioning Board and clinical commissioning groups. They were amended in 2013 by a set of amending regulations which brought in section 32B which contains the duty to ensure that relevant health bodies can arrange for the provision of a relevant health service to an eligible person by means of a personal health budget.

3 Page 3 of The Community Care, Services for Carers and Children s Services (Direct Payments) (England) Regulations 2009 ( the Community Care (DP) Regs ) deal with direct payments which are made to the parents of disabled children who are receiving social care provision from the Local Authority. The Care and Support (Direct Payment) Regulations 2014 ( the Care Act (DP) Regs ) deal with direct payments made to young people over the age of 18 for social care provision. 3. Guidance Statutory Guidance: The Special Educational Needs and Disability Code of Practice 20 dated January 20 and effective as of 1 st April 20 ( the SEND Code ) is the guidance to local authorities and other bodies on the C & F Act Care and Support Statutory Guidance issued under the Care Act 2014 is the guidance supporting the social care regime for adults ( the Care Act Guidance ) Non-statutory guidance Guidance on the right to have a Personal Budget in Adult NHS Continuing Healthcare and Children and Young People s Continuing Care 2014 ( the Personal Budget right to have Guidance ) deals with personal budgets for healthcare provision including how they can be obtained and what they can be used for. Guidance on direct payments for Healthcare: Understanding the Regulations (March 2014) ( the Guidance on direct payments for healthcare ) gives details of the arrangements for obtaining and using direct payments to pay for healthcare. 4. What are personal budgets A personal budget is a notional amount identified to deliver a service or provision for a particular child or young person with SEN or disabilities. It is not an actual amount of cash, but can be used for the purposes of calculating direct payments which may be received and used to pay for a particular provision. The C & F Act 2012 introduced a duty on a local authority ( LA ) to identify a personal budget for the provision specified within an EHC plan if they are requested to do so by a young person or parent of a child with SEN or

4 Page 4 of disabilities: section 49. The LA will prepare such a budget with a view to the parent of the child or the young person being involved in securing such provision generally by way of direct payments, although there are other methods of securing the provision. A personal budget requested in these circumstances may contain elements of education, social care and health funding. The SEND Code says (at paragraph 3.38) that partners (i.e. in this context, the LA (in the operation of both its education and social services function) together with the relevant health bodies) must set out in their joint commissioning arrangements their arrangements for agreeing Personal Budgets. In practice, in respect of the health care and social care provision specified within an EHC plan, the LA will effectively be recording the personal budgets and direct payments (if any) which have already been agreed or are being made by either the relevant clinical commissioning group ( CCG ) (in respect of health care provision) or its own Children s Services or Adult Social Care department (in respect of social care provision). Paragraph of the SEND Code confirms that the responsibility for decisions in relation to personal budgets for health care provision remain with the relevant CCG. Once a personal budget has been obtained, the next step is to identify what element of the personal budget, if any, can be provided by way of a direct payment. It is a direct payment which is the actual cash payment which is made, i.e. where individuals receive the cash to contract, purchase and manage services themselves. 5. The legal framework for personal budgets and direct payments for health care The power to make direct payments in health care is contained in Section 12 A of the NHS Act 2006: 12A Direct payments for health care (1) The Secretary of State, the Board, a clinical commissioning group or a local authority may, for the purpose of securing the provision to a patient of anything to which this subsection applies, make payments, with the patient's consent, to the patient or to a person nominated by the patient. (2) Subsection (1) applies to (a) anything that the Secretary of State or a local authority has a duty or power to provide or arrange under section 2A or 2B or Schedule 1; (aa) anything that the Board or a clinical commissioning group may or must arrange for the provision of under this Act or any other enactment.

5 Page 5 of The NHS (DP) Regs set out the detailed provisions for the making of direct payments under the NHS Act This includes the persons to, or in respect of whom, direct payments may be made, and the persons excluded from direct payments as well as the requirements for the conditions under which direct payments can be made and monitoring. Guidance about the NHS (DP) Regs was issued in the form of the Guidance on direct payments for healthcare which was to help CCGs (and others) understand and implement the regulations. These were very wide powers but the use of these powers was initially very limited. In April 2014, following a pilot scheme 2, all those who were receiving continuing healthcare from the National Health Service ( NHS ) were given the right to ask for a personal health budget. Continuing healthcare is the name given to a package of care that is arranged and funded solely by the NHS for individuals who are not in hospital but have complex ongoing healthcare needs, which will include some children with SEN and disabilities. In October 2014 this was strengthened to a right to have such a budget: regulation 32B of the NHS (RSR) Regs. Regulation 32B sets out a list of the ways in which a personal health budget can be managed and this includes the making of direct payments. The Personal Budget right to have Guidance was issued in September 2014 to help CCGs and other commissioners of adults and children s health and care services to understand the right to have a personal health budget in adult NHS Continuing Healthcare and children and young people s continuing care. The NHS Mandate (which CCGs must follow and which establishes aims which the Government would like to achieve in each year) currently aims to extend personal budgets from April 20, to include anyone with long-term health needs. However this is only an objective and there is no legal requirement for this wider group to be offered personal budgets in respect of their health care provision. The scope of personal health budgets is limited by the fact that certain aspects of NHS care are deemed inappropriate to be covered by a personal budget (such as emergency care and GP services). The Personal Budget right to have Guidance also indicates that in exceptional circumstances, a personal budget might be refused where it did not represent good value for money or the 2 Personal health budgets, including direct payments were piloted across England between 2009 and 2012.

6 Page 6 of costs of the personal budget outweigh the benefits of having one: paragraph 7.1. If a CCG refuses a request for a personal budget, paragraph of the SEND Code confirms that they must give reasons for their refusal in writing and provide an opportunity for review, but the review and any challenge which a parent wishes to make to the refusal, will have to be carried out via internal NHS complaints procedures. 6. The legal framework for personal budgets and direct payments for social care In relation to social care, the relevant law is different depending upon whether the young person is a child or an adult (for social care purposes, a young person remains a child until they are 18). There are also transitional provisions in the Care Act dealing with children approaching 18. Social Care provision children section 17A of the Children Act Section 17A (1) is an enabling provision permitting regulations to set out the basis on which direct payments can be made. Section 17A (2) lists the persons who can benefit from social care direct payments: (2) A person falls within this subsection if he is (a) a person with parental responsibility for a disabled child, (b) a disabled person with parental responsibility for a child, or (c) a disabled child aged 16 or 17, and a local authority ( the responsible authority ) have decided for the purposes of section 17 that the child's needs (or, if he is such a disabled child, his needs) call for the provision by them of a service in exercise of functions conferred on them under that section. The Community Care (DP) Regs contain the detailed provisions about the making of direct payments under various community care enactments, including the Children Act. These regulations have been superseded for young people receiving social care provision by those made under the Care Act, but these regulations will still apply to those under the age of 18 who are receiving such provision. If an LA offers services to a disabled child or their family who has been assessed as in need within the meaning of section 17 of the Children Act, the LA must offer direct payments to pay for that provision if certain conditions are met. Regulation 7(2) of the Community Care (DP) Regs confirms that the LA must be satisfied:

7 Page 7 of that the child's need for the relevant service can be met by securing the provision of it by means of a direct payment; and that the welfare of the child in respect of whom the service is needed will be safeguarded and promoted by securing the provision of it by means of a direct payment. Paragraph of the SEND Code also confirms that the LA must be satisfied that the person who receives the direct payment must use them in an appropriate way and will act in the best interests of the child. Social Care provision adults sections 26, 31 and 32 of the Care Act Section 26 (1) defines personal budgets for adult social care. Under section 26, if a young person over the age of 18 has eligible care and support needs, or if the LA decides to meet such needs, it must issue a personal budget for those social care needs. Section 31 deals with adults who have capacity to request direct payments and subject to the conditions set out in that section being met, where an adult requests direct payments, the LA must, subject to the regulations made under the Care Act in relation to direct payments, make those payments For adults who lack capacity similar provisions apply with different applicable conditions (section 32 of the Care Act). The Care Act (DP) Regs deal with the detailed provisions under which LAs can meet a person s social care needs by the making of a direct payment. Chapter 11 of the Care Act Guidance gives statutory guidance about personal budgets under the Care Act. Social Care provision transitional provisions For children approaching the age of 18, there is also a new duty under section 58 of the Care Act which will require LAs to carry out a child s needs assessments for them where there is likely to be a need for care and support after they reach 18 and the LA considers that it would be of significant benefit to the child to do so. This will be the case regardless of whether the child currently receives social care services or provision. The child s need assessment should look at the adult social care services for which a young person might qualify when they turn 18 and give the child information on these services, which could include a predicted personal budget, so that young people can plan and make informed decisions about their future.

8 Page 8 of 7. The legal framework for personal budgets and direct payments for special educational provision Section 49 (1) of the C & F Act 2014 says that an LA that maintains an EHC plan, or is securing the preparation of an EHC plan, for a child or young person must prepare a personal budget for him or her if asked to do so by the child s parent or the young person. Section 49 (3) provides for regulations to be made about personal budgets, including about direct payments, whose purpose is representing all or part of a personal budget to be made to a child s parent or a young person, or a person of a prescribed description in prescribed circumstances, in order to secure provision to which the budget relates. Whilst section 49 gives the right to request a personal budget in respect of the special educational provision specified in an EHC plan, there are limits on the scope of that right. The SEN (PB) Amendment Regs inserted regulation 4A into the SEN (PB) Regs, which confirmed that in certain circumstances, an LA is not required to prepare a personal budget. This will apply where the personal budget is part of a larger overall budget sum and disaggregation of the sum for the personal budget: would have an adverse impact on services provided or arranged by the LA for other EHC plan holders, or where it would not be an efficient use of the LA s resources. If the LA does refuse a personal budget on such grounds, it should inform the child s parent or the young person why it is unable to do so. The SEND Code (paragraph 9.106) indicates that the LA should work with the parent or young person to try to personalise the services in question through other means and should use the information to inform future joint commissioning arrangements to ensure that greater choice and control can be achieved in future. Any complaint which a parent or young person wishes to make about the LA s decision to refuse to issue the personal budget would also have to be via internal complaints procedures and there would be no right of appeal to the First-tier Tribunal in respect of such a decision. Paragraphs and of the SEND Code set out the funding streams from which personal budgets for special educational provision might be met, and the fact that it is anticipated that the LA s high needs funding block will, in many cases, be used, but that other sources of funding such as schools own funding could be used to identify the personal budget. Paragraph also confirms that a school placement choice might affect the availability of a personal budget as some special schools would make some special

9 Page 9 of educational provision available from their core provision, which would reduce the scope for a personal budget to be identified for such provision. It is the SEN (PB) Regs which contain the details explaining what these direct payments under the C & F Act 2014 are for and the conditions which attach to them. A local authority may only make direct payments in respect of the special educational provision specified in an EHC plan and may not make direct payments for the purpose of funding a place at a school or post 16 institution When can a personal budget be requested for the provision within an EHC plan? Personal budgets are optional for any of the provision specified within an EHC plan. There is no duty on a parent or young person to request that the LA identify a personal budget. However, LAs must publish information about the availability of personal budgets, organisations that provide advice and assistance in connection with personal budgets and conditions which must be met before direct payments can be made: regulation 3 of the SEN (PB) Regs. This information must be made available via the LA s Local Offer which should include information on personal budgets in respect of provision for special education, health care and social care needs. The SEND Code also suggests that the LA should set out clear and simple statements of eligibility criteria and the decision-making processes, as part of their Local Offer: paragraph If, having considered this information, a parent or young person wishes to request that the LA identifies a personal budget for the provision within the EHC plan, they can do so: when a draft EHC plan is being prepared in accordance with section 38 of the C & F Act 2014; or when an EHC plan is being reviewed or reassessed in accordance with section 44 of the C & F Act As outlined, in respect of personal budgets for health care or social care provision within an EHC plan, the LA will effectively simply be recording the personal budgets which have already been agreed in respect of those elements of provision. These would, in practice, need to have been agreed prior to those points, in order for the LA to be able to identify such a budget when the EHC plan is being prepared or reviewed/reassessed. 3 See Regulation 6 of the SEN (PB) Regs. 4 See Regulation 4 of the SEN (PB) Regs

10 Page 10 of Details of any personal budgets which have been identified by the LA should be set out in section J of the EHC plan. 9. How might a personal budget be delivered? In respect of all types of provision for which a personal budget has been requested and identified, there are four potential ways in which the child s parent or young person might be involved in securing the provision and having the personal budget delivered: Direct payments where individuals receive the cash to contract, purchase and manage services themselves; An arrangement whereby the LA, school or college (or the CCG or LA in the case of health or social care personal budgets) holds the funds and commissions the support specified in the plan (these are sometimes called notional budgets); Third party arrangements where funds (direct payments) are paid to and managed by an individual or organisation on behalf of the child s parent or the young person; A combination of the above. Paragraph of SEND Code addresses these methods of deliver and there are similar provisions within the Personal Budgets right to have Guidance (paragraph 3.2): People can have a personal health budget in one of the following, or any combination of the three, ways: 1. A notional budget - where the commissioner (for example the CCG) holds the budget but utilises it to secure services bases on the outcome of discussions with the service user. 2. A third party budget - where an organisation independent of the individual and the NHS manages the budget on the individual s behalf and arranges support by purchasing services in line with the agreed care plan. 3. A direct payment - where money is transferred to a person or his or her representative or nominee who contracts for the necessary services. CCGs should ensure all three options are available to enable people to make a choice about the level of control they feel comfortable with.

11 Page 11 of There are similar provisions in the Care Act Guidance as well at paragraph confirming that personal budgets in respect of adult social care provision can be delivered in these ways too Direct payments for the provision specified within an EHC plan Direct payments can be made for all types of provision specified within an EHC plan, and where such payments are made, the details of them should be set out, alongside the personal budget which they are being used to deliver, at section J of the EHC plan. The legal basis for the direct payments will vary, depending on the type of provision for which they are being used (as explained above). However, their contents are very similar in terms of those who can and cannot be recipients of direct payments, and the conditions for receipt, monitoring and review of direct payments. The recipient of direct payments (or their nominee nominated to receive the payments on their behalf) must in all cases: consent to the making of the payments; be over the age of 16; not lack capacity within the meaning of the Mental Capacity Act 2005 to consent to the making of direct payments; not be a person within the Schedules to the relevant regulations (effectively these exclude persons subject to certain drug and alcohol rehabilitation programmes from receiving direct payments). There are certain specific additional requirements in respect of the information which should also be set out within an EHC plan if direct payments are being made to secure health care or special educational provision within the plan. Special educational provision Paragraph of the SEND Code confirms that in respect of direct payments for special educational provision, section J must also set out the SEN and outcomes to be met by the payments. The LA must also give written notification to the parent or young person of the conditions needed for receipt There are three main ways in which a personal budget can be deployed: As a managed account held by the local authority with support provided in line with the persons wishes; As a managed account held by a third party (often called an individual service fund or ISF) with support provided in line with the persons wishes; As a direct payment. In addition, a person may choose a mixed package that includes elements of some or all three of the approaches above

12 Page 12 of of the direct payments, and should do this alongside the draft EHC plan. The parent or young person should confirm their agreement to both the budget and the conditions for the receipt of direct payments: regulation 8 of the SEN (PB) Regs. Health care provision If direct payments are being made for health care provision, there must be a Personal Health Budget Care plan agreed between the recipient of the payments and the CCG making them. Regulation 8 of the NHS (DP) Regs sets out the information which must be included within such a plan. Paragraph of the SEND Code confirms that the information needed for such a plan could be fulfilled by sections G and J of the EHC plan as long as those sections include certain information, including: the health needs to be met and the outcomes to be achieved through the provision in the plan; the things that the direct payment will be used to purchase, the size of the direct payment and how often it will be paid; the name of the care co-ordinator responsible for managing the Care Plan; who will be responsible for monitoring the health condition of the person receiving care; the anticipated date of the first review, and how it is to be carried out; the period of review that will apply if the CCG decides to reduce the amount of the direct payment; where necessary, an agreed procedure for discussing and managing any significant risk; where people lack capacity or are more vulnerable, the plan should consider safeguarding, promoting liberty and where appropriate, set out any restraint procedures. 11. The amount of direct payments for health and special educational provision in an EHC plan Direct payments made to pay for the special educational or healthcare provision specified within an EHC plan must be sufficient to pay for the whole of such provision and if they are not, they must be reviewed and adjusted accordingly: Regulation 10 of the SEN (PB) Regs and Regulation 13 of the NHS (DP) Regs. This is important because where direct payments are made, the special educational or health care provision which the LA or relevant CCG would be required to secure or arrange, will be deemed to have been secured or arranged for the purposes of their respective duties: sections 49(5) and 49(7)

13 Page 13 of of the C & F Act Any payments made would therefore need to be of an amount to allow the provision to be fully paid for. 12. Reviewing and monitoring for direct payments for provision within an EHC plan Direct payments must be kept under review whenever there is a change in the goods and services for which they are used and regulation 11 of the SEN (PB) Regs specifically requires the LA to review direct payments for the provision within an EHC plan: at least once within three months of the payments commencing; and when conducting a review or reassessment of an EHC plan under section 44 of the C & F Act The relevant regulations under which direct payments are made for health or social care provision also contain provisions on when such payments must be reviewed. As noted, the direct payments for such provision recorded at section J of an EHC plan will reflect the decisions made in respect of them by the relevant health body or LA s Children s Services or Adult Social Care departments. Any changes to the payments following a review by those bodies would have to be recorded in section J of the EHC plan when the LA carries out its own review of the plan under section 44 of the C & F Act The NHS (DP) Regs require direct payments being made in respect of healthcare to be reviewed at least once within the first three months of payments commencing, and thereafter on an annual basis (regulation 14). The Community Care (DP) Regs require a review of the direct payments being made for social care provision for children within the first 12 months of payments being made, and thereafter on an annual basis (regulation 16). In respect of young people over the age of 18, the Care Act (DP) Regs require an initial review of direct payments for social care provision within six months of the payments commencing and thereafter a review every 12 months (regulation 7). There are provisions which permit the LA or relevant CCG to stop direct payments which are being used to pay for the special educational provision or health care provision specified within an EHC plan. In both cases, if the payments are stopped or reduced, written reasons for the decision must be given and the recipient has a right to request that the decision is reconsidered (Regulations 12 and 14 of the SEN (PB) Regs and regulations 14 and 17 of the NHS (DP) Regs). As with other challenges involving personal budget and direct payment decisions, these would be via internal LA or NHS complaints procedures.

14 Page 14 of However, in either case if direct payments are stopped, the duties under section 42 of the C & F Act 2014 for the LA to secure the special educational provision and the CCG to arrange the health care provision specified within the EHC plan will remain and they will have to ensure that the provision is provided and paid for by some alternative means. 13. Limitations on the payment and use of direct payments for provision specified within an EHC plan As outlined above, direct payments will only be available if a personal budget can be agreed, and in certain circumstances a budget does not have to be issued, or a decision may be taken not to do so. Similarly, although the C & F Act 2014 gave a right to request direct payments to pay for the different types of provision specified within an EHC plan, there are limitations within the regulations which mean that in practice, there will be circumstances where direct payments can be refused by an LA or health body and whilst a parent or young person could challenge that decision, this may be of limited use in actually securing direct payments for the provision. Special educational provision Regulation 6 of the SEN (PB) Regs confirms that before making direct payments, the LA must be satisfied of certain matters, including the fact that the direct payments will not adversely impact other services or be an inefficient use of their resources; Regulation 6 of the SEN (PB) Regs also confirms that direct payments can only be used for the special educational provision within section F of an EHC plan and cannot be used for placement costs; The permission of the Head teacher or Principal of the school or other institution where the child or young person with SEN or disabilities attends is required, in order for direct payments to be used for services which are provided at the school or institution: regulation 9 of the SEN (PB) Regs. Health care provision Regulation 3 of the NHS (DP) Regs confirms that before making direct payments for healthcare provision the relevant health body (CCG) must have regard to: whether it is appropriate for a person with that health condition to receive them; the impact of the condition on the person s life; and whether a direct payment represents value for money.

15 Page of The Guidance on direct payments for health care (paragraph 3.4) confirms that a CCG may decide not to make direct payments in various circumstances, including where it would inappropriate for that person given their condition or the impact on that person of their particular condition. Paragraph 3.2 of the same guidance confirms that direct payments cannot be used for certain types of health care provision including: GP services; Emergency procedures; Surgical procedures; Prescription charges. Social Care Provision In relation to social care provision, there is no duty under the C & F Act 2014 to deliver the provision set out in an EHC plan. The social care provision, including any direct payments, will only be enforceable if they are being provided under the relevant social care legislation, i.e. The Chronically Sick and Disabled Persons Act 1970 in the case of children and the Care Act in so far as adults are concerned. The impact therefore of social care direct payments in so far as an EHC plan is concerned will depend upon what has been agreed with social services in relation to the social care provision referred to in the EHC plan.

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