• The complaint
• The Ombudsman’s role and powers
• How I considered this complaint
• What I found
• Recommended action
• Final decision

The Ombudsman's final decision:

Summary: Mrs X complained Coulson and Collins Care Home Ltd (‘the Care Provider’) failed to refund an overpayment, incorrectly charged administration fees, and delayed responding to Mrs X’s complaint. The Care Provider was at fault and should apologise to Mrs X and pay her £250 for uncertainty and distress caused. It should also refund the identified overpayment, administration charges and review its service user contract to bring it in line with the Competition and Markets Authorities consumer law guidance (2021).

The complaint

1. Mrs X complains on behalf of her late father (Mr Y) that Coulson and Collins Care Home Limited (‘the Care Provider’):
   • 1. Failed to refund care charges incurred after Mr Y’s death.
     2. Deducted an administration fee from a refund.
     3. Delayed responding to her communications and complaint.
2. Mrs X says this caused Mr Y’s estate financial loss. She says it caused her uncertainty, distress and inconvenience to trying to resolve the complaint.

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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. If they have caused an injustice, we may suggest a remedy. (Local Government Act 1974, sections 34 B, 34C and 34 H(3 and 4) as amended)
4. Our guidance on Good Administrative Practice during COVID-19 advised councils and care providers to ensure service users received updated advice on any potential changes to timescales or delays in relation to complaints.
5. If we are satisfied with an organisation’s actions or proposed actions, we can complete our investigation and issue a decision statement. (Local Government Act 1974, section 30(1B) and 34H(i), as amended)
6. 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

7. I spoke with Mrs X and considered information she provided. I considered information provided by the Care Provider following initial enquiries. This included contract, invoicing, and accounts statement information.
8. I conducted an interview with a Manager at the Care Provider dealing with the complaint.
9. I also considered the Care Quality Commission (Registration) Regulations 2009 on fees (‘CQC regulations’) and the Competition and Markets Authority 2021 guidance (‘CMA guidance’), on “UK care home providers for older people-advice on consumer law”.
10. Mrs X and the Care Provider had an opportunity to comment on my draft decision. I considered any comments received before reaching a final decision.

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What I found

11. The CQC’s (Registration) Regulation 19, requires care providers make written information available about any fees, contracts and terms and conditions, where people are paying either in full or in part for the cost of their care, treatment, and support.
12. The CMA guidance says care providers must:
    • Provide details of any trial periods and material upfront payments including how such payments will be protected and refunded.
    • Give residents a pro-rata refund of any pre-payments they have made if they end their contract early.
    • Provide information about a full range of fees typically charged and such terms in its contract should be transparent, so that residents and representative can foresee and understand, in advance how they might be affected.
13. The Care Provider’s complaints policy says it will acknowledge complaints within 48 hours and aim to respond to complaints within 28 working days. Complaints can also be escalated to the Director. It aims to conclude all complaints within six months unless there is a good reason, and a different deadline is agreed with the complainant.

What happened

14. Mrs X had financial power of attorney for her late father (Mr Y). Mr Y was previously getting some funding from the local authority.
15. On 28 May 2021, Mr Y started a new private contract (‘the Contract’) with the Care Provider. Mr Y’s care fees were £750 per week.
16. Mrs X said the Care Provider initially requested six weeks advanced fees starting on 28 May, in line with a trial period in the Contract for new residents. Mrs X said she discussed this with a manager who agreed Mr Y would pay four weeks (£3000), as he was already a resident.
17. However, the Care Provider’s account statement (‘the Statement’) shows it still issued an invoice (‘INV01’) for £4500 on 28 May for six weeks fees. The Statement indicates Mrs X made payments of £2120 towards INV01 on 4 and 28 May.
18. The records show Mrs X also issued a cheque (‘CHQ1’) for £3260 to the Care Provider on 10 June, which does not appear in the Statement. Mrs X said CHQ1 comprised the balance of the 4 weeks advance being £880, and a further contribution of £880 owed by Mr Y for early May when he was still part funded by the local authority. Mrs X therefore believes she made an overpayment of £1500.
19. The Statement shows the Care Provider issued further invoices from July 2021 onwards, four weeks in advance of the date payment due date. The Statement shows Mrs X normally paid the invoices before they were issued or on the same day.
20. The Care Provider issued its last invoice (INV02) on 9 June. The Statement confirms this covered Mr Y’s stay from 9 June until 7 July 2022
21. The Statement shows Mrs X paid INV02 on 27 June, slightly later than her normal course. However, Mrs X believes the payment covered Mr Y’s stay from 27 June until 23 July 2022. Mr Y passed away on 8 July 2022.
22. Mrs X therefore sought a refund for what she believed to be two weeks overpayment following Mr Y’s death and a further refund of £1500 for CHQ1. Mrs X said the CP ignored her multiple requests between August and October. The records show the Care Provider and Mrs X exchanged letters about this issue in late October.
23. Mrs X said the Care Provider eventually agreed to refund £1500 but deducted £360 in administration fees. Mrs X said the Care Provider did not provide her with an explanation about how the refund was calculated and its administration charges.

Mrs X’s complaint and the Care Provider’s response

24. On 3 November 2022, Mrs X complained to the Care Provider about the issues raised with us.
25. The Care Provider responded on 26 January 2023 and explained:
    • It was sorry for the delayed response due to the impact of COVID-19 on staff.
    • Mr Y was not owed a refund as the final payment on 27 June, covered his stay from 10 June until 7 July 2022. The Care Provider sent Mrs X a copy of the Statement to confirm this.
    • It had refunded £1500, but applied administration charges. This was because it initially sent the refund to the account details held on its record. It then had to recall and re-transfer the refund to a different account at Mrs X’s request.
26. Unhappy with the Care Provider’s response Mrs X approached the Ombudsman. Mrs X provided us with a schedule of payments (‘Schedule’) listing all her payments. She also said the CP had not sent her any invoices until September 2021.
27. A Care Provider manager told me:
    • It sent all invoices by post to Mrs X’s home address as she did not want emails.
    • Mrs X did not pay £2120 twice towards INV01 as shown in the Statement (paragraph 17) and this was a recording error. Mrs X made a single payment of £2120 on 28 May. But this was Mr Y’s contribution towards a previous invoice when he was part funded.
    • The six weeks advance trial fee had not applied in Mr X’s case. It had agreed he would pay four weeks from 28 May.
    • It had not set out administration charges in its contract or any other documents. It had reviewed its contracts since Mrs X’s complaint to bring them in line with CMA guidance.
    • It apologised for the delay in responding to Mrs X’s complaint. This was due to a COVID-19 outbreak at the home and it was very short staffed at the time.
28. The Care Provider later confirmed:
    • It had reviewed its accounts and INV01 was for six weeks advance fees for the period 28 May until 8 July 2021. The refund of £1500 less its administration fees (£360) was for two weeks of the six weeks advance returned.
    • It received cheques from Mrs X for £3260 and £1500 (total £4760). It treated those cheques as payments towards INV01. It calculated an overpayment of £260 at this point which was credited to Mr Y’s account.
    • It was unable to provide a copy of its updated service contracts.

Was there fault and did it cause injustice?

i) Mrs X says the Care Provider failed to refund charges incurred after her father (Mr Y) passed away.

29. The available evidence shows the Care Provider agreed Mr Y would pay four weeks advance fees (£3000) from 28 May 2021. Mrs X therefore paid £2120 by standing order and then issued a cheque (CHQ1) for £3260. Mrs X explained CHQ1 included the balance (£880) of the four weeks advance fees and Mr Y’s outstanding contribution for early May (£880) when he was still part funded. The evidence shows Mrs X had therefore made a £1500 overpayment at this point and was due a refund for this amount.
30. The Care Provider’s explanation of INV01 and how it treated Mrs X’s various payments is inconsistent because:
    • The Care Provider confirmed Mr Y would pay four weeks advance fees, but it later confirmed INV01 was issued for six weeks.
    • The Care Provider explained Mr Y’s 28 May 2021 payment was wholly for an outstanding previous contribution owed by him. However, its Statement says it was for INV01 and it has not evidenced the previous amount owed.
    • The Care Provider confirmed it received CHQ1 and CH2 and treated those as payments towards INV01. But its Statement does not reflect this or set out how it processed these cheques. It also does not explain how it reconciled these payments with Mrs X’s earlier 28 May payment, which the records show was also for INV01.
    • Once Mrs X made the 28 May and CHQ1 payment (above) she had paid all monies owed to the Care Provider until its July 2021 invoice. Mrs X has not mentioned CHQ2, but the Care Provider confirmed receipt of these funds. This means CHQ2 was a further overpayment which should also have been refunded to Mrs X. The Care Provider failed to address this.
31. The Care Provider’s failure to record the correct fee period for INV01, set out amounts previously owed by Mr Y and reconcile Mrs X’s payments (including CHQ1) and the refund due under CHQ2 is poor record keeping and fault. This caused Mr Y’s estate financial loss, and Mrs Y distress and frustration.
32. The records show the Care Provider correctly invoiced Mrs X between 8 July 2021 and 27 June 2022. Mrs X also paid all the invoices. While Mrs X believes she is owed a refund for the two weeks after Mr Y died, the Care Provider’s records from 8 July 2021 until 27 June 2022 do not show any irregularity in relation to this period and I do not find any fault in relation to this point.

ii) Mrs X says the Care Provider charged an administrative fee for processing a refund.

33. Based on the explanation set out in paragraph 29 (above), Mrs X was due a £1500 refund which the Care Provider agreed and was a partial remedy. However, it deducted an administrative charge of £360 from the refund.
34. The CQC regulations and CMA guidance (paragraphs 11 and 12) require care providers be transparent about charges. The Contract does not mention any charges for processing refunds and the Care Provider also confirmed it had not included this information in any other documentation. Mrs X was therefore unaware of these charges until her request. The Care Provider’s application of charges to process the refund was therefore inconsistent with Regulation 19 and the CMA guidance and is fault. It caused Mr Y’s estate financial loss and Mrs X distress and frustration trying to resolve the situation.

iii) Mrs X says the Care Provider delayed responding to her communications and managing her complaint.

35. The available evidence does not show any contact from Mrs X about the refund until her letter in late October 2022. The records show the CP then wrote to Mrs X to explain its charges for the refund. There is no evidence of earlier contact from Mrs X and so no evidence of delay. I do not find fault in relation to this point.
36. Mrs X complained in November 2021. The Care Provider did not respond until 26 January 2023. The records do not show the Care Provider acknowledging Mrs X’s complaint within 48 hours or sending a complaint response within 28 working days as set out in its complaints policy (paragraph 13). The Care Providers failure to process Mrs X’s complaint in line with its policy is fault. I appreciate the Care Provider explained it was impacted by an outbreak of COVID-19 which affected its response time. However, the Care Provider’s failure to process Mrs X’s complaint and provide her with an update about the delay was also inconsistent with our guidance on principles of good administrative practice during COVID-19 (paragraph 4) and is fault. It caused Mrs X avoidable uncertainty and frustration about whether her complaint was being properly managed.

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Recommended action

37. The Care Provider has refunded £1140 to Mrs X which is a partial remedy. It also confirmed it was reviewing its service contracts. However, I will make further recommendations to address the full extent of the injustice identified in this statement.
38. Within a month of my final decision, the Care Provider should:
    • Apologise to Mrs X for failing to refund the correct overpayment amounts due to Mr Y’s estate, incorrectly applying an administration charge for a refund and delays in responding to her complaint and any uncertainty, distress and frustration caused.
    • Pay Mrs X £250 for distress and frustration caused by its failure to address her refund requests.
    • Refund Mr Y’s estate £360 being an administration charge deducted from an overpayment refund of £1500 of which £1140 has already been returned.
    • Refund Mr Y’s estate a further £1500 being an overpayment made during his stay between 28 May 2021 and 7 July 2022.
39. Within three months of my final decision, the Care Home should:
    • Review its service user contract to bring it in line with the Competition and Markets Authorities consumer law guidance (2021).
40. The Care Home should provide us with evidence it has complied with the above actions.

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Final decision

41. I have completed my investigation and found fault which caused injustice. I have made recommendations to remedy injustice the Care Provider has not yet agreed to carry out.

Investigator’s final decision on behalf of the Ombudsman

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Investigator's decision on behalf of the Ombudsman

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