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Update: Crackdown on unfair care home practices

Which? welcomes new guidance that tackles the lack of transparency from care homes in the UK

Update: Crackdown on unfair care home practices

UPDATE 7 December 2018: The Competition and Markets Authority (CMA) has told Care UK, one of the country’s largest care home providers, that it must refund more than 1,600 residents who were charged an upfront ‘administration’ fee of as much as £3,000 – or face legal action.

The CMA believes Care UK was breaking the law by charging this fee from residents, for which they received no services or products in return. It also believes that the company’s description of the charge is misleading.

Care UK has been given until 10 January 2019 to respond.

Alex Hayman, Managing Director of Public Markets at Which?, says: ‘We’ve heard from hundreds of residents and their families about the difficulties they have experienced when dealing with care homes, including being charged excessive upfront fees just for moving in.

‘While no amount of money can make up for the stress and hardship some families may have suffered as a result of unfair fees, Care UK should now act swiftly to refund those affected, to avoid causing them further anxiety.

‘All care home providers must scrap these excessive charges and implement the regulator’s recent consumer law advice to ensure older people and their families can make informed choices and are not hit with unfair fees or contract terms.’

16 November 2018: New guidance on what care home providers should and should not be doing has been published by the Competition and Markets Authority (CMA).

The aim of this government-backed guidance is to help older residents and their families make more informed care decisions. This follows a year-long study by the CMA, which identified a risk of residents being treated unfairly.

We played a part in supporting the new measures, gathering evidence of people’s experiences of care homes for the CMA and formally responding to the consultation on the draft guidance in the summer.

Which? welcomes the new guidance, following our investigation that found that many care homes are failing to provide contracts and may be breaking the law by neglecting to provide information about important terms.

Care home contracts – a checklist of terms to look out for before signing, and how to deal with unfair clauses.

What the new guidance says: a summary

The guidance generally addresses the need for greater transparency, and is targeted at UK care homes that look after people aged over 65. Here are some of the main points that it covers:

  • Key information, including fees charged: This must be presented upfront and in a timely manner, including on websites. For example, information about fees must be accurate and up-to-date.
  • Contract terms: These must be accessible and easy to understand. If, for example, terms are contained in several different documents, they could be deemed ‘hidden’ and therefore unfair under consumer law.
  • Fee-increase terms: Fee variation terms should clearly explain why and how a resident’s fees may change. Plus, providers must not increase fees arbitrarily.

Alongside the new guidance, the CMA has published an open letter to care homes, reminding them of their responsibilities under consumer law. It also urges them to immediately review their contract terms and business practices against the advice.

Care homes that fail to comply with the law could face action from the CMA or others such as Trading Standards, who can bring court proceedings and seek compensation on behalf of residents. In some cases, they could also bring a criminal prosecution.

Which? responds

Alex Hayman, Which? managing director of public markets, reflects: ‘We have previously found too many care homes failing to be upfront about important terms and conditions, leaving residents hit with unexpected fees or contract terms that can have far-reaching and devastating consequences for vulnerable people and their families.

‘It is vital that care homes implement this welcome advice quickly, to ensure residents and their families can make fully informed and confident choices at what can be a complex and distressing time in their lives.’

We’ve been pushing the government to fix the care system in the UK. Find out more by visiting our Care Needs Care Now campaign page.

Getting to grips with care home fees

Care home fees can vary wildly across the UK, and we’ve found that they’re a postcode lottery. For example, on average, residential care in a nursing home in Greater London costs 44% more than a nursing home in the North East.

Find out everything you need to know about care home fees, including the various payment options and local authority funding, with our care home finance guide.

Cost of care and eligibility checker – if you live in England, enter your postcode and answer a few simple questions to find out more about care home fees in your area, and funding options.

For Scotland, Northern Ireland and Wales, see our care home fees article.

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