Care home provider ‘broke law’ by charging extra fees to NHS-funded residents, rules regulator

Care home provider ‘broke law’ by charging extra fees to NHS-funded residents, rules regulator

Care home provider ‘broke law’ by charging extra fees to NHS-funded residents, rules regulator

Care home provider ‘broke law’ by charging extra fees to NHS-funded residents, rules regulator

Care UK wrongly charged continuing healthcare users fee for enhanced rooms and will make more than £1m in refunds, says Competition and Markets Authority, though provider rejects ruling

Care home provider ‘broke law’ by charging extra fees to NHS-funded residents, rules regulator

Provider Care UK broke consumer protection law and NHS rules in charging continuing healthcare users an “unfair additional fee towards essential care”, the competition watchdog has ruled

The Competition and Markets Authority (CMA) found that the provider made paying the “shortfall fee” a condition of admitting residents, where NHS clinical commissioning groups’ funding was insufficient to cover the accommodation in question. This was contrary to the Enterprise Act 2002 and the National Framework for Continuing Healthcare and NHS-funded Nursing Care, said the CMA.

On the back of the ruling, Care UK has agreed to pay more than £1m in refunds to residents charged the fee since October 2015, and will be contacting eligible residents by letter next month. However, the provider rejected the watchdog’s conclusion that it broke the law, blaming “unclear NHS guidance” and questioning why the CMA had “singled out Care UK” when such fees were common practice across the sector.

Shortfall fee

In its judgment, the regulator cited as evidence a sample agreement that Care UK asked some people to sign before admission to one of its premium care homes – which offer enhanced facilities compared with standard homes.

This said that NHS funding was insufficient to cover the costs of the available room in the home and, under normal circumstances, the person would not be admitted; however, if they agreed to pay the shortfall they would be admitted.

The CMA said requiring someone to pay the shortfall fee as a condition of providing CHC was contrary to the Enterprise Act 2002, and also said Care UK’s approach was contrary to the CHC framework.

This was revised in 2018 to clarify when top-up payments were permissible, in response to the CMA’s 2017 report on the care home sector. This found that CHC users were, wrongly, being asked for shortfall payments, but there were also uncertainties about what additional services could be self-funded under NHS rules.

NHS rules on private funding

The current framework states that NHS funding should always cover assessed health and social care needs, and privately purchasing additional services should be entirely voluntary, and providers should not make this a condition of receiving NHS-funded provision.

It says there should be a clear separation between the delivery of NHS-funded and privately-funded services, so staff delivering privately-funded care should not also be providing treatment, care and support that are part of the person’s CHC care plan. Based on this, it says examples of private provision are hairdressing, aromatherapy, beauty treatments and entertainment, as well as rooms that are more expensive than needed to meet assessed needs.

A spokesperson for Care UK said the “enhanced fee” it charged covered a range of benefits for residents in a “premium setting including spacious ensuite rooms, on-site facilities such as cafes and cinemas, a wide range of lifestyle activities and a premium dining experience”.

‘Backwards step on consumer choice’

Residents always had the option of more modest, fully-funded homes as an alternative, and the CMA’s action to stop them “offering families the option of placing their loved ones in a premium home by making a personal contribution in addition to NHS funding is a backwards step in terms of consumer choice”, the spokesperson added.

“The number of families this affects within Care UK has always been very small and, as such, we agreed to settle with the CMA to enable us to focus on the more pressing challenges facing the sector at present.”

More than 160 residents at over 20 Care UK premium homes will be offered compensation by the end of November 2020. The majority of those affected will receive a pay-out of more than £1,000, with some receiving substantially more based on their circumstances.

The care homes provider has also signed formal commitments to stop charging this additional fee altogether for residents at its homes.

The Care UK spokesperson added: “In reaching this settlement, we do not accept that we have breached any rules or misled anyone taking a place with us, we have done our best to be transparent with all involved.”

Michael Grenfell, executive director of enforcement at the CMA, said “We are pleased to see Care UK committing to make repayments as quickly as possible, and to stop charging this additional fee altogether, which is good news for all current and future residents.”

Creative Commons Disclosure

This article was originally published by Charlotte Carter in CommuniteCare. Click here to view the news story.

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Care home provider ‘broke law’ by charging extra fees to NHS-funded residents, rules regulator.

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