The New Fair Cost of Care Tool for Supported Living: What Providers Need to Know in 2026

December 9, 2025

With Supported Living services under unprecedented financial and operational pressure, the new Fair Cost of Care tool developed by the More Than a Provider coalition has arrived at exactly the moment commissioners and providers need a clearer benchmark for what “sustainable” actually means.

If you’re preparing for the 2026–2027 recommissioning wave, it’s worth approaching this in two parallel tracks: (1) tighten your fundamentals using these bid writing principles, and (2) set a clear commercial approach using a practical tender strategy. The costing tool is most powerful when it sits inside a coherent narrative about deliverability, quality and outcomes — not as a spreadsheet you attach at the end.

This cornerstone guide explains what the tool is, why it matters, how councils are likely to use it, and how providers can respond strategically as major frameworks and DPS arrangements refresh through 2026–2027.

Why Supported Living needed a costing model

Unlike some other care markets, Supported Living has often operated without a widely accepted national costing methodology. In practice, local pricing can vary dramatically, commissioners use different assumptions, and “value” is sometimes defined inconsistently. The result is a market where:

providers struggle to evidence real costs in a way commissioners can compare fairly,
commissioners lack a shared benchmark and must rely on local precedent,
negotiations can feel subjective rather than transparent and auditable,
and people with high needs can become “stuck” in inappropriate (and expensive) placement types because pathways and cost logic don’t align.

The new tool aims to bring consistency via a nationally usable framework that reflects the real costs of high-quality Supported Living, including the parts that are frequently under-acknowledged (supervision time, training, governance, contingency, recruitment friction and complexity).

What the Fair Cost of Care tool includes

The model provides a structured, transparent way of calculating Supported Living costs using common building blocks. While the exact layout may evolve, the core components typically include:

Wage costs (aligned with local labour markets)
Employer on-costs (National Insurance, pension contributions, statutory costs)
Training and competence (induction, refreshers, specialist modules, competency sign-off)
Supervision and management time (registered manager/ops oversight, practice leadership)
Overheads (registered office, compliance, governance, HR, finance, quality assurance)
Travel and mileage (where relevant to model type and geography)
Complexity uplifts based on risk, behaviour, health needs and deliverability factors
Local recruitment realities that affect safe mobilisation and sustainability

Importantly, this is not presented as a single “national price”. It’s a national methodology local commissioners can apply consistently, and providers can use to explain why a safe, deliverable model costs what it costs.

Why this matters in 2026–2027

2026–2027 is shaping up to be a defining period for Supported Living commissioning. Several forces are converging at the same time:

Major LD/autism frameworks are reopening after long Covid-era extensions and “bridge” arrangements.
The Procurement Act 2023 increases expectations around transparency, defensible evaluation and objective reasoning.
Learning disability and autism services remain one of the largest cost drivers in adult social care spend, increasing pressure for consistent pricing logic.
Commissioners face scrutiny to demonstrate that fees reflect evidence and deliverability — not guesswork or legacy rates.

The Fair Cost of Care tool helps commissioners show a clearer rationale for pricing decisions, while giving providers a stronger, more comparable basis for commercial discussions.

How commissioners are likely to use the tool

Every local authority and ICB will adapt the model to their own market position, but in 2026 it is likely to be used in at least four ways:

Fee benchmarking: comparing local fees with evidence-based ranges derived from common assumptions.
Package negotiation: stress-testing high-cost packages (particularly 2:1/3:1, waking nights, or high-risk transitions) against a structured costing logic.
Tender pricing guidance: setting pricing parameters, assumptions, or templates aligned to the model to reduce disputes later.
Market shaping and sufficiency: identifying where underpricing correlates with provider instability, failed mobilisation, or lack of complex-needs capacity.

In practical terms, this means the most “commercially fluent” providers won’t just quote a rate. They will explain the rate using the same language and components commissioners are being encouraged to use.

What the tool changes (and what it doesn’t)

What it changes

It gives a shared structure for discussing cost drivers (wages, on-costs, training, management, overhead, complexity).
It makes hidden inputs visible (supervision time, compliance time, governance rhythm, recruitment friction).
It improves auditability for commissioners: “why is this package priced this way?” becomes easier to answer.

What it doesn’t change

It doesn’t guarantee uplift in every area or for every provider. Local budget and politics still matter.
It doesn’t replace value. Panels still need evidence of outcomes, quality, stability and deliverability.
It won’t fix weak models. If your delivery approach isn’t robust, a costing spreadsheet won’t rescue it.

How providers can respond strategically

1) Understand the assumptions (and don’t fight the wrong battle)

Councils will increasingly expect providers to reference the same building blocks the tool uses. If you respond defensively (“our costs are just higher”), you risk looking unstructured. A stronger approach is to show you understand the model and can explain where your service sits within it.

Practical actions:

Map your current pricing template against the tool’s headings (even if you don’t adopt it exactly).
Check your assumptions on: supervision cadence, training hours, management span, recruitment costs, sickness/absence cover and contingency.
Ensure your governance inputs are described as operational necessities (audits, quality visits, practice leadership), not “overheads we’d like”.

2) Strengthen your complexity and “why this ratio” logic

The tool reinforces a direction of travel: complexity uplifts should be transparent and evidenced. Providers should be ready to show, in a calm and structured way, why particular staffing levels are required and how they will be reviewed over time.

High-value evidence includes:

Clear MDT evidence supporting 1:1 / 2:1 / 3:1 deployment.
Behavioural risk assessment and functional formulation (where PBS applies).
PBS plans that connect function → proactive strategies → staffing implications.
Data showing how your model reduces incidents, restrictive practice, crisis call-outs or safeguarding events.
A review rhythm: when and how you assess readiness to step down intensity safely.

Commissioner reassurance line: “We use staffing as a stabilisation tool, then review it systematically with the MDT to reduce intensity where safe — rather than locking people into permanent high-cost support.”

3) Translate “cost” into “deliverability” (the language commissioners are scoring)

In 2026 tenders, pricing and deliverability will be tightly linked. Commissioners have experienced failed mobilisation, unsafe transitions, and workforce instability. So your commercial narrative must show that your price is what makes safe delivery possible.

Show the operating realities your pricing covers:

Mobilisation safety: shadow shifts, parallel staffing, first-week audits, contingency cover.
Workforce resilience: recruitment pipeline, local pay realism, supervision and retention strategy.
Quality assurance: audit cycles, practice observations, incident learning loops, medication governance.
Clinical/PBS integration: access to specialists, MDT working rhythm, escalation protocols.

When you connect these to outcomes (stability, reduced escalation, tenancy sustainment), you stop looking like “a provider asking for more money” and start looking like “a provider preventing predictable system failures”.

4) Build a sharper narrative about value and outcomes

The tool gives structure for costs — but your competitive edge comes from proving impact. Councils will still differentiate providers on outcomes, not just pricing logic. Strong outcome themes in Supported Living now include:

Step-down from inpatient/residential settings into stable community living.
Reduced staffing intensity over time where clinically appropriate.
Reduced restrictive practice, improved emotional regulation and communication.
Stable tenancies and reduced placement breakdown.
Progression toward work, community roles, relationships and citizenship.

Tender-writing move: pair one cost driver with one outcome claim. Example: “Higher practice leadership input in the first 12 weeks reduces incidents and prevents breakdown, which avoids re-procurement and crisis placement costs.”

5) Prepare for tenders to reference the tool directly

It’s plausible that some 2026/27 Supported Living procurements will include pricing templates aligned to the model, or ask for justification where your pricing differs from benchmarks. Preparation now reduces panic later.

Update:

Pricing templates: use consistent headings that mirror commissioner logic.
Bid library content: outcome evidence, mobilisation plans, governance, PBS capability.
Complexity uplift “explainers”: a short narrative plus evidence list for high-cost packages.
Case studies: step-down, stabilisation, restrictive practice reduction, tenancy sustainment.

A practical way to use the tool without getting stuck in spreadsheet debates

One risk is that costing tools become a battle of cells and assumptions. The providers who do best keep the tool in its proper place: a transparent basis for discussion, supported by operational evidence.

A simple three-layer approach

Layer 1: The model (methodology)
Show that your pricing is built from clear components (wages, on-costs, training, supervision, overhead, complexity).
Layer 2: The service reality (deliverability)
Explain how those components show up in daily practice: supervision cadence, audit rhythm, practice leadership, contingency cover, PBS coaching.
Layer 3: The impact (outcomes and value)
Evidence what changes over time: fewer incidents, reduced restrictions, stable tenancies, step-down in intensity, reduced crisis escalation.

This structure is also extremely “panel-friendly” in tenders: assessors can score it because it reads like a clear logic chain.

Common mistakes providers should avoid

Using the tool as a weapon: “The spreadsheet proves you must pay us X.” This triggers defensiveness and closes negotiation.
Talking costs without deliverability: if you can’t show how money creates safer mobilisation and stability, you look abstract.
Over-claiming complexity: commissioners will challenge ratios if the MDT rationale, PBS formulation or risk evidence is thin.
Ignoring progression: high-cost packages must still have a trajectory where clinically appropriate (stabilise → develop → step-down).
Forgetting overhead credibility: describe governance in practical terms (audits, quality visits, learning loops), not as “head office costs”.

What this means for the 2026–2027 re-tender wave

The Fair Cost of Care tool is likely to shape — directly or indirectly — one of the biggest Supported Living tender cycles in over a decade. High-spend LD and autism services are exactly where commissioners will want strategic, evidence-led bids that stand up to scrutiny.

Providers who understand and can speak the tool’s language will be better equipped to:

defend sustainable fees without sounding defensive,
negotiate more confidently with a shared methodology,
present robust value-for-money narratives that panels can score,
show alignment with national best practice and market-shaping priorities.

Practical next steps for providers

Benchmark your model: review your 2026 pricing logic against the tool’s assumptions and headings.
Refresh your evidence pack: outcomes data, audits, PBS examples, restrictive practice reduction, tenancy sustainment, family feedback themes.
Build a complexity uplift framework: a repeatable way to explain ratios using MDT evidence, functional assessment and risk baselines.
Strengthen housing readiness: partnerships, pathways, tenancy preparation and environmental design capability.
Audit your “data story”: choose a small set of KPIs you can report reliably and trend over time.

This links to wider questions around how providers prepare for tenders and develop strong responses. These are covered in our health and social care bid preparation and tender development hub.

The organisations that thrive will be those that combine strong values with strong commercial clarity — and can describe, in plain language, how sustainable cost leads to sustainable outcomes.