Summary: Mr F complains on behalf of his mother about the care provider’s increase in fees and says it provided inadequate explanations. The Ombudsman has found no fault.

The complaint

1. Mr F complains on behalf of his mother, Mrs J, that Methodist Homes (the Provider) has increased its fees above the rate of inflation for a number of years without good reason, has refused to publish management job descriptions, and has failed to be transparent or accountable.
2. He also complains the Provider would not deal with his complaint through its complaint’s procedure and its responses to his concerns were inadequate and evasive.
3. Mr F says the increases will cause financial difficulties. He wants the care provider to publish management job descriptions and the results of a full, independent audit of its accounts.

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The Ombudsman’s role and powers

4. 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)
5. If an adult social care provider’s actions have caused an injustice, we may suggest a remedy. (Local Government Act 1974, section 34H(4))
6. 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

7. I considered the information Mr F sent and the Provider's response to my enquiries. The length of our investigation was affected by the coronavirus pandemic.
8. Mr F and the Council had an opportunity to comment on my draft decision. I considered any comments received before making a final decision.

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What I found

Relevant law and guidance

9. Regulation 19 of the Care Quality Commission (Registration) Regulations 2009 says care providers must:
• 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.
• notify people 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.
10. The Regulations do not require providers to give an explanation of the fees or increases. However, the Competition & Markets Authority’s November 2018 guidance on consumer law for care home providers says:
• “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.
• Whilst it is not the only way to comply with the law, we consider that care homes are more likely to ensure compliance where they review existing residents’ fees on an annual basis by reference to a relevant, objective and verifiable published price index, clearly specified and explained in the contract.”
11. The Health and Social Care Act 2008 (Regulated Activities) Regulations 2014 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. The standards include Regulation 16 which says providers must have a system in place to handle and respond to complaints.
12. The Care Provider has a four stage complaints procedure. This says complaints are an expression of dissatisfaction with a service and can be made when a person believes that:
• they have not received the level of service they expect or wish from the Provider
• a mistake or inappropriate action has taken place
• the Provider has broken the terms of an agreement or not met its service standards
• the Provider’s actions are having a harmful effect on someone.

What happened

13. Mrs J is elderly and has dementia. Her son, Mr F, has power of attorney for her health and welfare and property and affairs. Mrs J went to live in a care home operated by the Provider in 2014.
14. The Residential Care Agreement dated 29 July 2014 says her weekly fee was £813 per week. The attached terms and conditions said:
• The Total Agreed Weekly Fee will be reviewed by us in April each year. We may also review our fees at any other time if:
1. a change in law comes into force which means we have to cover an increase in our costs;
2. your care needs (as set out in the Care Plan) change and we make a change to the services you receive; or
3. the type of room you occupy changes.
• We will give you at least 28 days’ notice before the reviewed fees are payable
• Residents could give 28 days’ notice to leave the Home.
15. In response to my draft decision, Mr F said the fee was reduced to £692 per week in November 2014, as Mrs J was assessed as not having dementia.
16. In February 2018, the Provider wrote to Mr F giving notice that Mrs J’s fees would increase to £858 per week from April 2018. The letter explained this was for several reasons including inflation and wage increases for staff and leaflets were attached with more information.
17. In February 2019, the Provider notified a further increase to £901 per week. It said this was due to the increase in the cost of running the Home.
18. Mr F was dissatisfied and wrote to the Provider in March 2019. He said there had been a 30% increase in fees in four years, which was unjustified as inflation had only increased by 10% over that time and there had been no change in in Mrs J’s care needs.
19. The Provider replied to Mr F but did not deal with his correspondence through its complaint procedure. It said there had been an 8.9% salary increase as it had started to pay care staff the Real Living Wage and there had also been an increase in pension costs. It set out how it calculated cost increases for services.
20. Mr F remained dissatisfied and continued to correspond with Provider. In particular, he was concerned that the Provider’s management structure was opaque and it was unclear what roles managers played. He felt residents and relatives had a right to know what their fees were paying for and asked for management job descriptions to be published to aid transparency and accountability. He said Mrs J’s original charge had been £692 per week and a 30% increase in fees was unjustified.
21. Mr J asked to discuss the issue at a relatives meeting at the Home in July 2019 but says “Head Office had instructed the home manager to prevent any discussion of these matters."
22. In its replies, which were escalated to the Area Director in August 2019, the Provider:
• Described the range of services it provided and how it predicted cost changes, including using RPI, as this included housing costs.
• Noted there had been an increase in food costs.
• Said it had increased salaries and this meant there was a reduced reliance on expensive agency staffing.
• Said any surplus was reinvested and the fees increase was not caused by low occupancy rates.
• Explained management roles were carefully considered and not automatically replaced. Roles and pay were subject to job evaluation and market rates. The replies summarised the roles of the management team but the Provider did not consider it was appropriate to share managers’ job descriptions.
23. Mr F approached the Ombudsman in September 2019. Following our contact with the Provider it offered to meet Mr F. He declined as he considered a meeting would not be worthwhile and asked for a “a simple, clear explanation in writing of the roles of the different managers".
24. The Provider wrote to Mr F on 29 November 2019. It said:
• It followed the Competition & Markets Authority advice, which says increases should be fair and clear, and organisations could take into account relevant cost drivers. It had communicated fees increases with residents and set out these cost drivers.
• It was not required to publish job descriptions and the Freedom of Information Act did not apply as it was a charity.
25. Mr F complained to the Ombudsman.

My findings

26. It is not the Ombudsman’s role to determine whether care home fees are reasonable, what the level of increases should be, or whether increases are justified. Care providers are entitled to charge fees and to increase these. My role is to determine if the Provider has followed the relevant law and guidance.
27. I have also considered Mrs J’s contract with the Provider. We can look at contracts and any standard information given to the resident or their representative before they moved in. We interpret contracts on an ordinary reading. If a contract does not make sense to us, then we may view it as a failure by the care provider.
28. When Mr F raised his concerns, the Provider did not treat this as a formal complaint. This was not fault as its complaint policy defines complaints as “dissatisfaction with a service”. Mr F’s concerns were about costs and how increases were determined so did not come within the complaints procedure.
29. The Regulations require care providers to notify people of increases in fees in time to consider whether they wish to continue with the service. The Provider did this, in line with its terms and conditions.
30. Mr F says the Provider’s responses were evasive and it refused to provide him with job descriptions for its managers. This is not fault as there is no requirement for care providers to supply this information.
31. The Provider was not required to explain the increase but I can see that it has done so in its replies to Mr F and also in the initial notification letter and leaflets. I realise Mr F is dissatisfied with these explanations, but that is not evidence of fault by the Provider. It provided a clear explanation of why it needed to increase the fees, responded to his concerns and also offered to meet with him. I find there was no fault in the way the Provider responded to Mr F’s concerns.
32. The Provider’s 2013 terms and condition attached to Mrs J’s contract says fees will be reviewed annually but contain no details about fee variation terms or the method of calculating the change. In response to my draft decision, the Provider confirmed the terms and conditions had been amended to reflect the 2018 guidance from the Competition & Markets Authority. I note this guidance recommended care providers use inflation indices which include housing costs, which the Provider does.
33. It is not fault for a care provider to issue a new contract to a resident, as long as the person has time to decide whether they can afford any increase in fees. If Mr F was unhappy with the revised contract he could have considered whether to move Mrs J. The Provider is a charitable organisation operating in a market economy; it must be free to make its own decisions about the fees it charges. The only restriction on this is that it must be open and transparent with people using its services and give enough notice for people to make other arrangements if they wish to. I am satisfied the Provider gave enough notice and explanation for the increase and I do not find fault.

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Final decision

34. There was no fault. I have completed my investigation.

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Investigator's decision on behalf of the Ombudsman