Ninety-five councils have had home-care contracts handed back by private companies who cannot deliver services for the funding they receive.
The figures are due to be reported tonight (Monday) by BBC’s Panorama confirm one in four providers are threatened by insolvency.
The Local Government Association (LGA) warns adult care in the UK now faces its “last chance” to address historic under-funding.
The number of cancelled contracts is revealed in responses to Freedom of Information requests put to 197 of 212 UK councils.
Providers themselves say they cannot could not recruit or retain the staff they needed.
The government stays English councils had received £9.25bn for social care.
Cllr Izzi Seccombe, Chairman of the Local Government Association’s Community Wellbeing Board, acknowledged the £1 billion councils will initially receive this year – followed by £674 million in 2018/19 and £337 million in 2019/20 – represents vital funding for services caring for the most vulnerable in our communities over the next few years.
She said: “The LGA has led a national effort to highlight the huge pressures facing adult social care and secure £2 billion of significant new government funding for the system over the next three years.
“However this is just a starting point, and there currently remains a shortfall in the projected social care funding gap.
“There is already an expectation that the money will reduce the immediate pressure on the NHS.
“But it is desperately needed to protect vital support services, like home care, ensuring older people and those with mental health conditions, learning and physical disabilities live dignified and fulfilling lives.
“The overall funding pressures facing councils will also mean they will need to make further cutbacks to vital services this year, including social care.
“We have warned that the combination of the historic under-funding of adult social care, and the significant pressures of an ageing population and the National Living Wage, are pushing the care provider market to the brink of collapse.
“These figures show the enormous strain providers are under, and emphasises the urgent need for a long-term, sustainable solution to the social care funding crisis.
“That is why it is so important that the Government’s Green Paper on social care will see local government leaders playing a central role in finding a long-term solution that reforms and fully funds our care system.
“This is essential if we are to do more than just help people out of bed and get washed and dressed but ensures people can live independent, fulfilling lives in the community, and relieve pressures on care providers and avoid widespread market failure.
“With councils facing further funding pressures and growing demand for support by the end of the decade, this is the last chance we have to get this right.”
According to the research, carried out for Panorama by Opus Restructuring and Company Watch, 69 home care companies have closed in the last three months and one in four of the UK’s 2,500 home care companies is at risk of insolvency.
The Centre for Workforce Intelligence estimates at least two million more carers will be needed by 2025 in England alone, in both in-home care and care homes, to cope with growing demand.
Research also released today (Monday) reveals cost of living in a care home can swallow up half the value of a family house with bills for a typical stay ranging between £50,000-£93,000 – a loss of between a fifth and a half of the value of an average house.
The estimates – for insurance firm Royal London – measure a family’s loss from the inheritance they would otherwise have expected when an elderly relative goes into a care home.
National estimates indicate around 160,000 care home residents have to pay their own bills – with their property either sold or pledged to meet costs.
Residents who have assets or savings above £23,250 cross the threshold by which the must cover own care home bills.
The analysis for Royal London showed, on average, someone who goes into a care home lives there for two-and-a-half years, paying bills that vary from £554 a week in the North East to more than £700 in the South East.
But where, in the North East, care home bills can cost as much as 56% of the price of a home. In n London, where the average house price is almost £500,000, bills are only 17.9% of a house
In the South East the price would be just under a third of the value of an average house.
The research revealed that in some cases residents live in care homes for longer periods with 1-10 staying for up six years.
Long-term residents are in many cases likely to spend the entire value of their house and more.
Royal London’s Debbie Kennedy said the figures were a “shocking reminder” of the huge costs to be faced for residential care later in life.
“The whole system is a lottery and we need to find better ways of supporting people to cope with these large and unpredictable bills,” she said.