Practical Issues in Developing Competitive Contracting for Home Care Services.

Abstract

Questions about the efficiency of publicly delivered social services and the prospects of drastic cut-backs in allocations have lead to increased interest in contracting out as a means for governments to lower cost and eliminate wastes. While most of the earlier research concentrated on ‘hard services’ such as street cleaning and garbage collection, Nelson (1980, p. 431) has noted the important distinction of ‘soft services … performed for or on people’. Unfortunately, there has been little research on programs which contract out these human services. This chapter will focus on the necessary conditions suggested in the literature to make purchasing ‘soft services’ cost efficient; and whether these conditions, particularly competition and improved oversight of vendors, have been met in Illinois’ statewide Community Care Program of home care services for frail elderly. In particular, we will examine the practical issues involved in fostering competition while improving service delivery standards. Then the impact of these changes on the unit rate for purchased services and the composition of contractors will be examined. The Community Care Program (CCP) was begun in 1980 and is administered by the Illinois Department on Aging through purchase care contracts with local proprietary and non-proprietary vendors.

Parts of this chapter were prepared for presentation at the Annual Midwest Political Science Association Convention, Chicago, April, 1985.