Summary: Mrs X complained on behalf of her mother, Mrs Y who is now deceased. Mrs X complained that Sunrise Senior Living Limited (the care provider) refused to consider a refund of an upfront community care fee of £6000 which Mrs Y paid when she started living with the care provider. That was following an investigation by the Competition and Markets Authority (CMA) which found the upfront fees were unfair. The care provider was not at fault. Mrs Y was not entitled to a refund as she paid the community fee and started living with the care provider outside the timescales it agreed with the CMA for refund requests.

The complaint

1. Mrs X complained on behalf of her mother, Mrs Y who is now deceased. Mrs X complained that Sunrise Senior Living Limited (the Care Provider) refused to consider a refund of a community care fee of £6000 which Mrs Y paid when she started living at the care home. This was following an investigation by the Competition and Markets Authority (CMA) into compulsory ‘upfront fees’. Mrs X said the fee was unfair caused Mrs Y upset and worry, and the care provider’s decision not to consider the refund is unfair.

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The Ombudsman’s role and powers

2. 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)
3. If we are satisfied with a care provider’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)

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How I considered this complaint

4. I spoke to Mrs X about her complaint.
5. I considered the care provider’s response to Mrs X’s complaint.
6. I considered the findings by the Competition and Markets Authority on the matter and the summary of undertaking agreed by the care provider.
7. Mrs X and the care provider had an opportunity to comment on my draft decision. I considered the comments before I made my final decision.

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What I found

8. The Competition and Markets Authority (CMA) is an independent non-ministerial government department which promotes competition for the benefit of consumers both within and outside the United Kingdom.
9. The CMA’s responsibilities are to ensure that consumers get good deals when buying goods and services, and that businesses operate within the law. The CMA says it does that in a number of ways including, protecting consumers from unfair trading practices.
10. In 2017 the CMA carried out an investigation into how some care providers charged for their services. That investigation uncovered an upfront fee called a ‘community fee’ charged by the care provider. It said the purpose of the fee was unclear but, ran into several thousands of pounds per person. The amount differed depending on which one of the care provider’s homes the residents lived in. The investigation found the fee was non-refundable once someone had lived with the care provider’s home for more than 30 days.
11. Following the CMA’s findings in 2018, the care provider provided legally binding commitments to stop charging those upfront fees for future residents. The care provider agreed to give compensation to residents who paid the community fee since 1 October 2015, and who remained with the care provider for less than two years. The level of compensation was based on the length of time the resident spent in the home, and the size of the fee paid by the resident.

What happened

12. Mrs Y moved into care home ran by the car provider in November 2014. Upon doing so she paid the care provider an upfront community fee of £6000. The care provider said it charged the community fee to cover the cost of maintaining communal areas such as lounges, dining rooms, gardens and other outdoor areas. Mrs X said that Mrs Y was upset about paying the fee and worried about the high cost. Mrs X said the care provider did not give Mrs Y a clear explanation of why she had to pay the community fee other than every resident had to pay it.
13. Mrs Y left the care home in February 2016 after a period of 15 months. Mrs Y died in February 2018.
14. In August 2018 Mrs X wrote to the care provider about the community fee. She referenced the findings from CMA and asked it to consider a refund of the community fee Mrs Y paid.
15. The care provider responded to Mrs X. It said it was unable to consider compensation requests for the community fee which fell outside the timescales it agreed with the CMA. The care provider said it agreed with the CMA to offer pro-rata refunds to former residents who paid the community fee on or after the 1 October 2015. It said Mrs Y fell outside of that timescale as she paid the fee in November 2014.
16. Mrs X remained unhappy and complained to the care provider. She said its decision not to consider Mrs Y’s refund was unfair and it should look at requests on a case by case basis.
17. The care provider responded to Mrs X’s complaint. It said it believed it had a strong case for charging the community fees. However, following discussions with the CMA it voluntarily agreed to offer the pro rata refund, and no longer charges the fees which the CMA deemed were likely unfair. The care provider reiterated that the agreement was to refund residents who moved into a care home on or after 1 October 2015. It said Mrs Y’s stay was outside those agreed timescales. It said it was unable to accept any claims from former residents who moved in outside the timescales agreed with the CMA.
18. Mrs X remained unhappy and complained to the Ombudsman.

My findings

19. The care provider entered into a legally binding voluntary agreement following the CMA’s investigation and findings. The agreement is to provide pro rata refunds for residents who paid the community fee on or after 1 October 2015. Mrs Y moved into one of the care provider’s homes in November 2014. Therefore, she is outside of the timescales set out in the agreement and the care provider is under no obligation to provide Mrs X with a refund. There is nothing in the agreement which says the care provider should consider requests for residents who fall outside the timescales. The care provider considered Mrs X request for compensation however it decided it would not accept any claims from residents who paid the fee and moved into a care home prior to 1 October 2015. The care provider is not at fault.

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Final decision

20. I have completed my investigation. The care provider was not at fault.

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Investigator's decision on behalf of the Ombudsman