Care UK issued with letter before action
6 December 2018: After a period of consultation under the Enterprise Act 2002 (EA02), a letter before action has been issued to Care UK Health and Social Care Holdings Limited and Care UK Community Partnerships Limited (together ‘Care UK’).
Although Care UK stopped charging an administration fee on 1 August 2018, it has not provided the CMA with satisfactory undertakings, including provision for financial redress for consumers. The letter before action notifies Care UK that, if necessary, the CMA intends to issue a claim against it under section 217 of the EA02 concerning breaches of the Unfair Terms in Consumer Contracts Regulations 1999, the Consumer Rights Act 2015 (CRA) and the Consumer Protection from Unfair Trading Regulations 2008. The CRA gave consumer law enforcers, including the CMA, the powers to secure financial redress for consumers from 1 October 2015.
Consumer law advice for care home providers
16 November 2018: The CMA has published the final version of advice for care homes about their obligations under consumer law. We’ve also published some other materials for care homes and residents and their families.
Consultation on draft consumer law advice for care homes
31 May 2018: The CMA has opened a consultation on draft consumer law advice for UK care home providers for the elderly. This draft advice covers a range of issues including the provision of upfront information, contract terms and business practices, providing services with reasonable care and skill, and complaints-handling.
The consultation is part of the CMA’s ongoing consumer protection work in the care home sector. As part of this work, the CMA has also today published its final advice on the charging of fees after a resident’s death following a consultation earlier this year.
Advice for care homes on the charging of fees after death
31 May 2018: The CMA has published its final consumer law advice on the charging of fees after a resident’s death, following a public consultation earlier this year.
Sunrise Senior Living Ltd settlement and associated undertakings
9 May 2018: The CMA has secured more than £2m in compensation for residents of a major care homes group as part of an investigation into compulsory ‘upfront fees’.
Sunrise Senior Living Ltd (‘SSL’) will be offering pro-rata compensation to residents, or their representatives, who paid a community fee and moved into a Sunrise home on or after 1 October 2015 and who left, or passed away, within 2 years of entering one of their care homes in England and Wales. The level of compensation on offer will be based on the length of time spent in the home and the size of the community fee paid by the resident.
Under the settlement, current residents will also be eligible for pro-rata compensation, if they paid a community fee and moved into the home on or after 1 October 2015 and leave the care home - or pass away - within 2 years of entering the care home.
In addition, any residents who paid a community fee and moved into a Sunrise care home on or after 1 October 2015 whilst in receipt of NHS continuing healthcare (‘CHC’) will be fully refunded as, in the CMA’s view, charging such fees is not compatible with NHS rules or consumer law.
The CMA understands that Sunrise has already started the process of contacting individuals (or their families) who are eligible for an offer of redress. If anyone believes that they or a family member is eligible and has not been contacted they can contact Sunrise at firstname.lastname@example.org. Sunrise requests that they include in that contact their name and/or the name of the resident that they are enquiring about, as well as contact information and details of which Sunrise Community (care home) this refers to.
As well as securing compensation in relation to the community fee, the CMA has obtained undertakings from SSL, the companies providing residential care under the Sunrise Senior Living brand and the controlling companies, that in future such fees will not be charged at all to new residents. The CMA will shortly be consulting on comprehensive guidance, which will include advice on large upfront charges. In this regard, these companies have agreed to comply with the advice (as set out in the undertakings) once finalised and published.
The companies have also agreed to abide by new CMA guidelines about the charging of fees after a resident has died, which is soon to be finalised and published following a public consultation.
Consultation on draft consumer law advice for care homes on the charging of fees after death
19 January 2018: The CMA has opened a consultation on draft consumer law advice for UK care home providers for the elderly. This draft advice covers the charging of fees after a resident’s death and the treatment of their possessions.
For relatives and representatives of deceased residents only
As part of the consultation, the CMA would also like to hear about the experiences of relatives and representatives of deceased care home residents.
Maria Mallaband Care Group undertaking
19 January 2018: A CMA investigation has resulted in one of the UK’s leading care home providers dropping its policy of charging fees after a resident has died.
Action against care home providers
30 November 2017: Following the launch of the investigation in June, in order to stop a number of care home providers using certain business practices and contract terms, the CMA has now written to these providers setting out its concerns. The CMA’s focus remains, currently, on the charging of upfront fees and requiring fees to be paid for an extended period following the resident’s death.
As announced in the care homes market study report the CMA will also be consulting on new guidance in early 2018, regarding fees charged after death.
On 13 June 2017, the CMA opened an investigation into a number of care home providers, due to concerns that some of the contract terms and/or practices they use may breach consumer law.
At the moment the focus of this case is on self-funding residents and the issues of large upfront fees and the fees charged after a resident’s death.
The CMA is also separately undertaking a market study which is considering whether the UK market for the provision of care home and nursing home services to the over 65s is working well for residents and for businesses competing fairly. The market study has identified a number of other consumer protection concerns and consideration is being given as to how these can best be addressed. Further details can be found in the market study update paper.