It calculated that this could save the health and care system more than £1bn, since hospital admissions were more costly than care options, freeing money to support the troubled home care market.
Research issued to support its claim to the Treasury for increased adult care funding said 26% of hospital admissions could have been avoided.
Consultant Newton Europe drew on thousands of anonymised case notes in sample areas Kent, Pennine Lancashire, Greenwich, Swindon and Sunderland to see where social care could have been more suitable.
A request for more funding for adult social care is one of the main planks of the LGA’s submission to the Treasury ahead of the 23 November Autumn Statement.
It fears a £2.6bn funding gap for councils by 2020 and warned that this scale of cash shortage could push more providers out of the market since councils could not afford to pay them enough.
Izzi Seccombe, chair of the LGA's Community Wellbeing Board, said: “The care provider market cannot carry on as it is and there is a real danger of more widespread market failure,” she said.
“Either care is properly funded or providers will pull out of council contracts or in worst case scenarios go bust. The market for publicly funded care is simply not sustainable as it stands.”
She said that in almost every case examined by Newton Europe there was evidence of over-provision of care.
“Savings identified would be achieved by shifting resources to support people living more independently than they do currently. This would mean moving funds from acute to community and social settings.”
