CQC published its State of Care 2025/26 report last Friday and the phrase that stood out for me was “by accident rather than design”. That’s how the regulator describes what’s happening to the adult social care market, and I think it’s the most honest sentence a State of Care report has carried for some years.
I should explain why I think it matters to every Registered Manager and owner, because there’s one part of this picture that’s still in our own hands.
Like several other areas of the private health and social care sector, care home provision is consolidating. The number of care home beds in England has barely moved since 2019, but the number of homes, as in individual establishments, has fallen by 8%, and homes with 50 or more beds now accounts for 70% of all provision, up from 59% in 2012. More than 1,500 small homes have left the market since 2012, and between September 2024 and September 2026 the number of homes owned by the five largest providers of care for older people grew by 26%, driven mainly by one US real estate investment trust that now owns and operates 9% of all registered care home beds.
Homecare, on the other hand, is going the other way, with just over 13,500 services now, up 42% on 2019, and three in ten of them supporting four or fewer people. Underneath both trends sits a funding model CQC calls fragile: councils overspent their adult social care budgets by £715 million last year, 223,000 fewer adults receive long-term council-funded care than twenty years ago, and 37% of care home residents now pay for themselves, rising to 47% in the South East.
This is a pretty depressing picture really; neither consolidation nor ‘atomisation’ is good for users of the services or the population as a whole, but there is some good news in the report too. Seven in ten of the 3,783 care homes assessed under the current framework are rated Good or Outstanding, and so are eight in ten homecare services. Nine in ten care homes are Good or Outstanding for being Caring and Responsive. Vacancy and turnover are both edging down, homecare hours are rising, and local authorities, assessed for the first time, came out with 59% rated Good.
I spent seventeen years in academia leading applied research programmes with the NHS before I started Insequa, and the first question you learn to ask of any research findings is who was in the sample. CQC is open that its assessments since 2024 have been risk-based, so the services it has looked at are more likely to be the ones causing concern. On that basis, if anything, the true picture of the sector is likely to be better than these numbers suggest.
The finding that matters most to providers though is that across the 6,294 adult social care ratings published under the current framework, the key question most in need of improvement is Well-led. A third of care homes are rated Requires Improvement or Inadequate for leadership, and in 55% of the assessments that looked at governance, management and sustainability, CQC found shortfalls. When the regulator asked its own inspectors why, the answer wasn’t that managers don’t know what good governance looks like, but that leaders don’t have the time and support to provide proper oversight and drive improvement, and don’t always listen to their staff or act on what they hear.
I find that more useful than any of the market statistics. None of us running care services can change the capital threshold, which has sat at £23,250 since 2010, or reverse the fall in international recruitment from 105,000 to around 30,000 in two years, or undo 787 visa licence revocations. Those are matters for government and for the Casey Commission, and I hope the sector keeps saying so loudly. Governance, though, is our bag, and it’s the one thing in this report a provider can decide to be good at, straight away.
Of course, Insequa has an interest here, because we help providers with strengthening their governance arrangements, it’s part of what we do for a living. But I’m not trying to sell our services because this principle matters. The services that are coping with a market in flux are the ones whose leaders can see their own service clearly, and CQC’s inspectors made exactly that point about size. They found medium-sized homes often lack the financial resilience of large ones and suffer high turnover of managers, while small homes (the ones disappearing fastest) get the best ratings of all because they can think flexibly and use what’s around them. Good leadership has never really been about scale. It’s about whether the person in charge has the time to look and the habit of listening.
If I were advising any provider reading this report, I’d start by protecting the time. If your governance happens in the fortnight before an inspection or a PIR, it’s revision rather than governance, and your inspector will be able to tell. I’d also treat your staff as the earliest warning system you’ve got. Almost one in four care home staff and one in five homecare staff left their jobs last year, and Skills for Care’s data shows that staff with a relevant qualification are a good deal less likely to leave, so training is as much a retention tool as a cost line. And I’d make sure you know your own numbers before someone else quotes them at you: your self-funder mix, your fee gap, your vacancy rate against the national figure. CQC has just told councils, in public, that it found access criteria shaped by financial or political considerations rather than people’s assessed need, and providers who can show their own evidence will have the stronger conversation.
The market is being reshaped by accident, and that’s a national failure that needs a national answer. The service you run is a different matter, and for all its warnings this report tells you exactly where to start.
Bill Watson, Director, Insequa