Care minister backs CMA crackdown on 'unscrupulous' care homes taking elderly 'for a ride'

A crackdown on care homes is underway, with new guidance for care providers to protect elderly from "unfair care home practices and secretive fees" - a move backed by Care Minister Caroline Dinenage who is keen to stop residents being “taken for a ride”.

New guidance by the Competition and Markets Authority (CMA) is intended for UK residential care homes and nursing homes supporting people over the age of 65. These care providers will need to ‘embed’ the guidance into their businesses to comply with consumer law.

Care homes who fail to follow the law may face action from the CMA, Trading Standards, or others, who can bring court proceedings, seek compensation on behalf of residents and bring criminal prosecutions.

Care minister Caroline Dinenage said: “It is a scandal some of the most vulnerable people in our society are being taken for a ride by a minority of unscrupulous care home providers. Everyone living in a care home should be treated fairly and with respect.

“I am determined to protect residents by stamping out unfair practices and secretive fees. This important new guidance will help care homes to understand and comply with their responsibilities under consumer law.

“Later this year we will set out plans to further improve consumer protections as part of the adult social care green paper.”

What's in it?

The CMA guidance covers what information care homes must give to prospective residents and their families, and when and how they should do so. It highlights how providers can ensure contract terms and the way residents and families are treated is fair, how to give care services ‘with reasonable care and skill’ and how to handle complaints fairly.

The guidance warns care homes that prospective residents and their families need clear, accurate, prominent and timely, upfront information.

‘For example, not being able to find the necessary information about pricing and terms and conditions on a provider’s website, or receiving key information only after someone has already expressed an interest in moving into a home, is likely to affect a prospective resident and their family’s ability to make informed decisions’.

The CMA guidance highlights:

• A requirement to provide key information upfront and in a timely manner, including on websites, so that potential residents and their families can make an informed decision before signing a contract - including full, accurate and up to date fee breakdowns.

• Contract terms must be clear, easy to understand and accessible. For example, terms contained in multiple documents located in different places may be considered ‘hidden’ and therefore unfair under consumer law.

• Fee increase terms must not allow providers to increase fees arbitrarily. Fee variation terms should set out clearly the circumstances in which the resident’s fees may change and the method of calculating the change.

Accurate, upfront, key information

The CMA states care homes must 'draw key information to prospective residents’ when they first contact and explain:

• Which residents you accept (e.g. state and self-funded).

• The type of care needs you cater for.

• An overview of the rooms, facilities and services available to residents.

• Pricing (including any upfront payments) and service.

• The size of the home (e.g. how many beds it has).

• A brief description of staffing arrangements.

• Highlight 'surprising' or important terms and conditions, such as: how self-funded residents’ fees may change during their stay.

• An accurate, representative indication of the total weekly fee rates you typically charge for self-funders, for each type of care service offered. What services are included in weekly fees and any optional, additional ‘extras’ which are not included and may need to be paid for separately.

• Any significant, additional costs that may be unavoidable for some residents because of their circumstances (e.g. when staff must accompany them to medical appointments).

• Details of upfront payments required, e.g deposit amount, the risk it protects you against and how it will be protected and refunded.

The CMA states care home providers ‘should explain all the key information at the beginning of their first visit to a home (ie before they are shown around) and ensure that they are provided with the key information in written form to take away. Your staff should be trained to provide this information.’

Consumer law enforcers can 'take action'

In an open letter to care providers (published 16 November), the CMA stated ‘The CMA and other enforcers, such as Trading Standards Services, can take action against care homes that don’t comply with consumer law.

The CMA has already taken action against some care home providers in relation to the charging of certain upfront fees and charging fees for extended periods of time after a resident’s death. ‘

The CMA conduct a compliance review, starting in November 2019, to assess the level of compliance by care homes with consumer law, and the progress made since publication of today’s advice. The regulator is also publishing a guide for potential care home residents to make sure they are aware of their rights.

The CMA’s year-long study into the care home sector concluded in November 2017 and identified a risk of residents being treated unfairly and that some care homes may be breaking the law. The CMA published separate compliance advice on fee charging after the death of a resident on 31 May.

To read the CMA guidance (published 16 November) click here