Urgent action needed across the UK care home market

30 Nov 2017 11:04 AM

The CMA is calling for reform of the care home sector so people get the support they need in their old age, and taking action against some homes.

The Competition and Markets Authority (CMA) yesterday published its final findings following an extensive review of whether the residential care homes sector is working well for older people and their families.

The year-long market study has found that:

As a result, the CMA is taking direct action under consumer protection law, and has also made a range of recommendations to government and others. These include:

CMA Chief Executive, Andrea Coscelli, said:

Care homes provide a vital service to some of the most vulnerable people in our society. However, the simple truth is that the system cannot continue to provide the essential care people need with the current levels of funding.

Without substantial reform to the way that councils plan and commission care, and greater confidence that the costs of providing care will be covered, the UK also won’t be able to meet the growing needs of its ageing population.

It is essential that residents and their families can make informed choices, understand how these services will be paid for, and be confident they will be fairly treated and able to complain effectively if they have concerns. We are now calling on care homes, councils and government bodies to help people navigate what can be a confusing system.

He added:

Of all people, it is especially important that care homes residents are treated fairly and have the full protections of consumer law. We will be taking steps to assist care homes in understanding their obligations, but we are also taking enforcement action now on some issues where we believe the law is being broken.

The CMA will continue to engage with governments, councils and the industry so that these recommendations can be used to inform future social care policies and consultations in England, Scotland, Wales and Northern Ireland. It will also work, as appropriate, with the independent experts commissioned by the government to inform the upcoming Green Paper on reforming care and support for older people in England.

Notes to editors

  1. The CMA launched its market study into care homes (residential and nursing homes for the over-65s) on 2 December 2016.
  2. The funding shortfall numbers above were calculated by the CMA based on an analysis of the financial performance of care homes in 2015/16.
  3. Market studies are carried out using powers under section 5 of the Enterprise Act 2002 (EA02) which allows the CMA to obtain information and conduct research. They allow a market-wide consideration of both competition and consumer issues. Market studies take an overview of regulatory and other economic drivers in the market and consumer and business behaviour.
  4. Further details of the CMA’s consumer law investigation can be found on the case page. The key pieces of consumer protection legislation relevant to the CMA’s investigation are the Consumer Protection from Unfair Trading Regulations 2008 (CPRs) and Part 2 of the Consumer Rights Act 2015 (CRA). As an enforcer under Part 8 of the EA02, the CMA can enforce the above legislation through the courts. Ultimately, only a court can decide whether a particular term or practice infringes the law. The CMA is not naming the parties under investigation at this stage.
  5. The size of the UK care home market is estimated at £15.9 billion, and there are currently more than 430,000 elderly people in care or nursing homes across the UK (Source: LaingBuisson, ‘Care of Older People UK Market Report’, 27th edition, September 2014).
  6. The CMA aims to consult on new guidance on fees charged after death in early 2018 and plans to consult on wider guidance in spring 2018 for care homes on the standards of behaviour that they should be meeting to comply with consumer law.
  7. The CMA isn’t able to resolve individual complaints or provide individual help or advice. This webpage lists organisations to contact if you need advice about an issue with a care home.
  8. The CMA is the UK’s primary competition and consumer authority. It is an independent non-ministerial government department with responsibility for carrying out investigations into mergers, markets and the regulated industries and enforcing competition and consumer law. For more information on the CMA see our homepage, or Twitter account @CMAgovuk, or Flickr, LinkedIn and Facebook pages. Sign up to our email alerts to receive updates on markets cases.
  9. Media enquiries should be directed to press@cma.gsi.gov.uk or call 020 3738 6337.
  10. Non-media enquiries should be directed to general.enquiries@cma.gsi.gov.uk.