The Competition and Markets Authority (CMA) last month published the findings of its study into residential and nursing care homes for older people and confirms that the current model of service provision cannot be sustained without additional public funding. The Government will be considering the recommendations and responding by way of a green paper it expects to publish later this summer.

In addition to the funding shortfall, the CMA indicated that, whilst the overall level of care was good, there were concerns in terms of provider practice relating to:

  • A lack of indicative pricing information on provider websites
  • The lack of a written contract between the provider and the resident
  • The practice of charging large up-front fees and deposits
  • The requirement to pay fees for extended periods after death
  • A wide discretion for care home providers to terminate resident contracts at short notice

The CMA will feed its findings into the Government review of elderly care. They will recommend the establishment of an independent body with oversight and input into public and private commissioning strategies, including costing and contracting, with a view to ensuring a better and more sustainable service provision in future.

The CMA has in some instances chosen to pursue providers on the subject of their contracting provisions and providers should therefore consider the CMA report with reference to their own contractual practices and fee arrangements.

The Government has committed to the publication of a green paper on the care and support for older people by the summer of 2018. In the meantime, Public Authorities are under a duty to assess care costs fairly and pay a fee that covers the true cost of care. Providers may find the CMA report to be a helpful tool in negotiating any necessary fee increase.