Summary: Mr X complained the Care Provider, I Care International Ltd, inappropriately stated it would increase his mother, Mrs M’s care home fees from £530 to £750 for one year and then to £950 thereafter. Mr X said this was unfair and it has caused him significant distress. The Care Provider was at fault for failing to provide Mrs M with a contract in a timely manner. The contracts the Care Provider then drew up for Mrs M and other residents were not in line with legislation and breached the Care Quality Commission’s Regulations. The Care Provider has agreed to apologise to Mr X and pay him £300 for the unnecessary distress it caused him. It has also agreed to review its contracts to ensure they are fit for purpose.

The complaint

1. Mr X complains the Care Provider, I Care International Ltd, inappropriately stated it would increase his mother, Mrs M’s care fees from £530 to £750 for the next year and then to £950 thereafter.
2. Mr X says the increase is unaffordable and unfair. He says he is in ill-health and the stress of this situation has made it worse.

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The Ombudsman’s role and powers

3. We investigate complaints about adult social care providers and decide whether their actions have caused an injustice, or could have caused injustice, to the person making the complaint. I have used the term fault to describe such actions. (Local Government Act 1974, sections 34B and 34C)
4. If an adult social care provider’s actions have caused an injustice, we may suggest a remedy. (Local Government Act 1974, section 34H(4))
5. The Health and Social Care Act 2008 (Regulated Activities) Regulations 2014 and the Care Quality Commission (Registration) Regulations 2009 set out the fundamental standards those registered to provide care services must achieve. The Care Quality Commission (CQC) has issued guidance on how to meet the fundamental standards below which care must never fall.
6. We may investigate matters coming to our attention during an investigation, if we consider that a member of the public who has not complained may have suffered an injustice as a result. (Local Government Act 1974, section 26D and 34E, as amended)
7. Under the information sharing agreement between the Local Government and Social Care Ombudsman and the Care Quality Commission (CQC), we will share this decision with CQC.

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How I considered this complaint

8. I spoke to Mr X and considered his view of the complaint.
9. I made enquiries of the Care Provider and considered the information it provided. This included a copy of Mrs M’s contract, the service level contract and her care plan. I also considered the contracts in place for other residents.
10. I wrote to Mr X and the Care Provider with my draft decision and considered their comments before I made my final decision.

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What I found

The law and guidance

Care Quality Commission

11. The Care Quality Commission (CQC) is the statutory regulator of care services. It keeps a register of care providers who show they meet the fundamental standards of care, inspects care services and issues reports on its findings. It also has power to enforce against breaches of fundamental care standards and prosecute offences.
12. Regulation 19 of the Care Quality Commission (Registration) Regulations 2009 states care providers must provide in writing:
• a contract detailing the service to be provided;
• information about the terms and conditions of the person’s care, treatment or support, including the expected costs and the requirement to pay for their care, treatment and support; and
• details of any changes to their terms and conditions, including increases in fees and give them sufficient time to consider whether they wish to continue with the service.
13. The CQC can prosecute for a breach of Regulation 19 without first serving a warning notice.

Competition and Markets Authority

14. In November 2018, the Competition & Markets Authority (CMA) issued guidance called “Helping care homes comply with their consumer law obligations”. The guidance says:

“For your contracts to be considered fairly balanced, residents should be entitled to receive the service they expect, on the agreed terms and not something that is, in any significant respect, different.

Notice of a change and a right for the resident to end the contract without penalty before it takes effect is unlikely ever to be enough to offer sufficient protection. Residents are often reluctant to move homes, even when unhappy or dissatisfied, because of the stress and inconvenience involved, and the potential negative impact on their health.

Consumer law requires that you specify at the outset, the circumstances in which you may need to make changes without the resident’s consent… these circumstances should be clear and narrow in scope and effect.

Fee increase terms need to be treated with great care, in particular so that they do not allow you to increase your fees arbitrarily. To ensure compliance with consumer law, your fee variation terms must set out clearly the circumstances in which the resident’s fees may change and the method of calculating the change.

Simply stating that your fees may go up as a result of ‘increased costs’, ‘local market conditions’ or ‘the wider national economic picture’, will not make your terms fair”.

What happened

15. Mrs M has been a resident at a care home owned by the Care Provider since 2015. She does not have capacity to make any decisions about her care or finances so her son, Mr X, does this for her. Mrs M paid £530 a week for her care.
16. Towards the beginning of 2017, the Care Provider appointed a new director at the care home. Mr X told me that the Care Provider had tried to increase fees around June 2018 but the Council had advised him that he must wait 12 months.
17. Therefore, in June 2019, the Care Provider wrote to Mr X. The letter said Mrs M’s fees had not increased for a number of years even though her needs had changed significantly. The letter said Mrs M needed full assistance with all aspects of personal care and with medication and sometimes needed 1:1 care. The letter continued “Rising costs of living, particularly raises in wage costs, have also been factored into our decision and as a comparative, the current high dependency rate for new permanent residents is £1,050 per week. As of 1st August 2019, the total weekly amount will be £750 with a further increase in 12 months to £950”.
18. Mr X complained to the Care Provider and then the Ombudsman.
19. As part of my investigation, the Care Provider said when the new director began at the care home, they could not find a written contract for Mrs M. It also said previously there was no formal charging policy.
20. The Care Provider provided a copy of the new charging policy. This provided no details of the circumstances when it would increase fees.
21. The Care Provider also sent me a copy of Mrs M’s contract which it wanted Mr X to sign on Mrs M’s behalf. This said “Fees will be reviewed from time to time as determined by I Care. Any increase will be as a result of market pressures, which I Care experiences for the provision of additional care service or as a result of statutory provisions coming into force after the date hereof”.

My findings

22. The Care Provider has not been able to supply a copy of any written contract between itself and Mrs M from when she became a resident. I accept that Mrs M did not have a written contract when the new Care Provider took over, however, she remained without a contract from when the manager took over in 2017 to June 2019 when they wrote to inform Mrs M her fees were increasing. This is a breach of Regulation 19 of the Care Quality Commission (Registration) Regulations 2009 and is fault.
23. The Care Provider is additionally at fault because it has not acted in line with the Consumer Rights Act 2015. Consumer law requires that care providers specify at the outset the circumstances in which they may need to make changes without the resident’s consent. These circumstances should be clear and narrow in scope and effect. Because the Care Provider does not have a written contract with Mrs M she could not know when it was reasonable for it to increase its charges.
24. The Care Provider provided Mr X with three reasons why it was increasing Mrs M’s fees.
25. Firstly, the Care Provider stated fee increases were required because Mrs M had not had an increase in a number of years. That is not the fault of Mrs M. And a failure by the previous Care Provider to increase fees does not negate this Care Provider’s requirement to act in line with legislation.
26. Secondly, the Care Provider stated increases were needed because of the rising costs of wages and other market forces. This is in contravention of the CMA guidance which states it is unfair to base increases on general reasons such as ‘increased costs’, ‘local market conditions’ or ‘the wider national economic picture’
27. Lastly, the Care Provider told Mr X it needed to increase Mrs M’s fees because her care needs had increased. The Care Provider has provided evidence to demonstrate Mrs M’s needs had increased significantly since she first came to live at the care home in 2015.
28. The Care Provider has sent me a copy of the contract it wants Mr X to sign on behalf of Mrs M. The contract contains no details about fee variation terms or the circumstances in which the resident’s fees may change or the method of calculating the change. The contract terms are not in accordance with the CMA guidance, consumer law or Regulation 19 of the Care Quality Commission (Registration) Regulations 2009 and this is fault.
29. Mr X has been caused significant avoidable distress, time and trouble because of the faults I have identified in the care provider’s actions. Fortunately, it has not caused injustice to Mrs M because Mr X is dealing with the matter on her behalf.
30. We may investigate matters coming to our attention during an investigation, if we consider that a member of the public who has not complained may have suffered an injustice as a result. The Care Provider has provided information which shows its contracts with other residents are also not in accordance with the CMA guidance, consumer law or Regulation 19 of the Care Quality Commission (Registration) Regulations 2009. This is further fault, potentially causing injustice to others.

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Agreed actions

31. To remedy the injustice identified above, the Care Provider has agreed to take the following action:
• within one month of the date of the final decision, the Care Provider has agreed to apologise to Mr X and pay him £300 for the significant distress and time and trouble the faults identified in this investigation caused him; and
• within two months of the date of the final decision the Care Provider has agreed to review its contracts to ensure they comply with CMA guidance and Regulation 19 of the Care Quality Commission (Registration) Regulations 2009, particularly around how much it may increase the fees, and by what measure. It has agreed reissue residents with these new contracts for signing.
32. The Care Provider has agreed to provide us with evidence it has carried these recommendations out.

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Final decision

33. There was fault leading to injustice. The Care Provider has agreed to my recommendations. Therefore, I have completed my investigation.

Investigator’s decision on behalf of the Ombudsman

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Investigator's decision on behalf of the Ombudsman