A perfect storm for disabled people
Saturday 16th January 2016
ANITA BELLOWS spotlights the failures of Atos’s successor – Maximus – in carrying out disability assessments
THE National Audit Office recently produced a report on the delivery of Department for Work and Pensions’ disability assessments.
This report does not deal with decision accuracy, claimant experience or the number of claimants found fit for work who did (or didn’t) move into employment.
It mainly assesses the value for money of DWP contracts, against a series of predetermined targets, and the way the contracts have been managed.
Of particular interest is the contract awarded to Maximus for disability assessments, which has been plagued with the same challenges previously encountered with Atos, and with some new problems attributable to both the DWP and Maximus.
Stung by its previous experience with Atos, the DWP has tried to tighten the terms of the contract in order to manage the provider’s performance and make it more accountable.
It does so by using service credits, which can eliminate the provider’s profit, if targets are not met.
This happened recently when Maximus failed to meet its targets. As its anticipated profit never materialised, Maximus’s shares dropped by 26 per cent.
The issue with the Employment and Support Allowance (ESA) contract is that it was flawed from day one. The National Audit Office details a number of unmet targets such as those related to assessment reports, which deal with their legibility, absence of medical jargon and consistency.
Only 13 per cent of the reports met contractual standards in the 12 months up to August 2015, but it has to be said that these targets, which were initially set by the Labour government, and which are used as a proxy to assess quality of reports, don’t necessarily reflect the quality or the accuracy of the decision eventually made on functional capability.
The same can be said of the claimant experience, which encompasses waiting time and satisfaction.
The main issue seems to have been the turnaround performance levels, which include volume and turnaround time (this is the clearance time of a claim, including processing up to the time a report is received by the DWP).
When Maximus took over from Atos for the delivery of work capability assessments in March 2015, it inheritated a toxic reputation and a huge backlog of over 700,000 ESA claimants.
Maximus also contractually agreed to meet the non-negotiable target of one million ESA assessments in 2015-16, although it seems it subsequently requested a revision of this target.
According to the National Audit Office, the DWP based its target not on achievable and realistic assumptions but on the number of assessments required in order to achieve the expected savings.
In other words, this volume of assessments was needed to reduce the number of people claiming disability benefits to the level expected to achieve the predetermined savings.
These savings were vitally important for DWP. They were, after all, at the crux of its programme of welfare reform, and it did not have many successes to demonstrate with universal credit or the work programme for disabled people.
Only through quickly processing new claimants and endlessly reassessing other claimants, could the DWP hope to increase the number of claimants found fit for work and leaving the ESA benefit.
This very ambitious target created disquiet at the tendering stage. Several bidders raised concerns and asked the DWP to consider other options.
The department refused, and one experienced bidder withdrew from the process because it could not meet the required number of assessments, and two others withdrew from the later negotiated procedure.
This left Maximus in a good position to win the bid. Unfortunately, Maximus had also based its tender on unrealistic assumptions, namely that it would have the capacity to process one million assessessments in 2015-16.
This capacity was partly a legacy of the Atos contract, with 1,400 clinical and administrative staff, 30 assessment centres managed by Atos, and access to the IT infrastructure developed by Atos.
Even so, Maximus is not on track to complete the expected number of assessments, mainly because of staffing issues. Maximus’s assumption was that 95 per cent of staff would still be in post after one month, but in practice only around half of those it recruited completed their training, so Maximus had no choice other than to recruit more staff in a very competitive market, offering very few long-term vacancies, and the only way to do this was to offer higher salaries.
The estimated cost of hiring and training healthcare professionals for ESA assessments increased from an average £26,000 (spring 2014) in the earlier contract to, for example, £44,000 for a London-based nurse in 2015-16.
This means that the cost of providing an ESA assessment has increased from £115 per assessment with Atos to £190 per assessment with the new ESA contract.
These costs do not include other departmental costs. For example, the DWP conducted 177,000 mandatory reconsiderations (required for an internal review of an ESA decision before a claimant can lodge an appeal) between October 2013 and October 2014 (the latest figures available).
The cost of an individual ESA mandatory reconsideration is £77.88, which means that during this specific year DWP spent almost £14 million reviewing the quality of initial ESA decisions challenged by claimants, which must be added to the overall cost of ESA assessments.
With a target of one million assessments in 2015-2016, it is certain that the number of mandatory reconsiderations will also have increased, as would the cost for DWP.
This pressure on Maximus to perform such a high volume of assessments has helped to reduce the number of oustanding claims to 410,000 in August 2015, but it has also led to a decline in the quality of the assessment reports, and more importantly for benefit claimants, to an unacceptable wait for an ESA outcome.
It still takes 23 weeks for Maximus to return an ESA report to a DWP decision-maker.
During all this time claimants will only receive the ESA lower pre-assessment rate of £73.10 for a claimant over 25.
And the decision-maker still has to make a decision based on the report received from Maximus.
It has always been clear that changing providers was never going to improve what is a flawed, unfit for purpose test to assess functionality for work, but there were expectations in some quarters that at least Maximus would be more competent than Atos.
This does not seem to be the case. Claimants’ experiences are as bad, and sometimes worse than under Atos, and ultimately, the aim of these already toxified ESA assessments has not changed.
The political aim of this government to reduce the number of disability benefit claimants, coupled with the greed of a provider with a reputation as a “disability denier” in the US, Canada and Australia, which could not pass up such a lucrative contract, has again created a perfect storm for disabled people.