In the Wake of NPM: How Do Local Authorities Monitor Private Care Providers?

Following NPM, contracting out public service provision to private actors became a common mode of governance, also in the area of social welfare. In most cases, however, delegating the task of providing social services to private actors imply that local governments still retain the overriding responsibility for assuring that such services are delivered in accordance with public values and quality standards. This implies that local governments must ensure that private contractors fulfill their tasks in accordance with the contracts; a task that requires extensive supervision. One of the legacies of NPM in local governance is thus the importance of monitoring contractors. Such monitoring is important not least in social sectors, were service users tend to be weak and quality hard to measure. This implies that monitoring costs are high. In Sweden, like many other countries, one of the welfare areas were contracting has been practiced most extensively is nursing home care for the elderly. The main question asked in this paper is how, given the high monitoring costs associated with monitoring social services, local governments cope with this task. What strategies do they develop to obtain reliable information regarding the quality of services contracted out, and how are private contractors held accountable for any deficiencies found? In order to answer the question, four case studies of local government monitoring of out-contracted services in nursing home care in Sweden were carried out. The results of the study as presented in the paper indicate that there was in fact little systematic monitoring carried out by the local authorities studied. Paradoxically, however, local politicians and administrators interviewed were generally quite confident regarding the quality of the services in the out-contracted nursing homes. Acknowledging the inherent difficulties in measuring quality in elder care, they nevertheless felt that they did have sufficient information regarding the private contractors’ performance. This was explained by the fact that the local governments had developed an alternative monitoring strategy, which we call network monitoring, which implies that, rather than systematically collecting information about various quality aspects of the services themselves, local governments relied on a multitude of channels, such as medical supervisors, incident reports, user surveys and complaints from relatives in order to detect if anything seemed to be out of order in the out-contracted nursing homes. This was seen as a more efficient form of monitoring, both in terms of cost and getting timely and relevant information. A less positive implication of the network monitoring strategy was that it was oriented foremost at detecting problems and severe quality deficiencies, implying that quality standards in effect became set at a basic level. Another implication was that the contracts themselves were not used as yard-sticks of performance, even if they contained provisions that were meant to not just uphold quality standards, but improve them.