Summary: There was fault by the Care Provider. There was no written contract for Ms Y’s care and no grounds to increase a previously agreed fee and attempt to backdate that increase. The Care Provider failed to act in line with the law and guidance from the Care Quality Commission and Consumer and Markets Authority. It will apologise to Ms X and make her a symbolic payment of £150 for her time and trouble.

The complaint

1. Ms X complained Tree Vale Limited (the Care Provider) increased the weekly fee for her late mother’s (Ms Y’s) care from August 2020 and backdated that charge to May 2020 when they had already agreed a fee for the year of April 2020-21. Ms X said the Care Provider should not have increased the fee until a further review in April 2021.

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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 or others. (Local Government Act 1974, sections 34B and 34C)
3. 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)
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. 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

6. I considered Ms X’s complaint to us and documents described later in this statement.
7. Ms X and the Care Provider 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

8. The Health and Social Care Act 2008 (Regulated Activities) Regulations 2014 (the 2014 Regulations) set out the requirements for safety and quality in care provision. The Care Quality Commission (CQC) issued guidance in March 2015 on meeting the regulations (the Guidance.) We consider the 2014 Regulations and the Guidance when determining complaints about services in care homes.
9. Regulation 19 of the 2014 Regulations requires a care provider to issue a statement with the terms and conditions of service including the fee and method of payment. This should where applicable include a written contract. The statement and contract should generally be issued before the service starts, wherever possible. The Guidance says:
• Providers must give people written information about the terms and conditions of care, including the expected costs, before their care begins
• Providers must tell people about any changes, including to the fee and give them enough time to consider whether they want to continue with the service
• People should receive reasonable notice of when payments are due.
10. The Competition and Markets Authority (CMA) has provided advice to care homes which we generally expect care providers to consider. The CMA’s guidance states:

Changes to residents’ fees during their stay: annual reviews

4.40 Balanced contracts require that residents receive what they have been promised, in exchange for paying an agreed price. Terms which give you, in effect, an unlimited right to increase the price of your service after it has been agreed are likely to be unfair under consumer law, especially where the resident has no choice but to pay the higher price or leave. As with general variation terms, transparency is critical, so that prospective residents and their representatives can foresee changes and understand the practical implications for them.

4.41 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. This should enable residents and their representatives to foresee, on the basis of clear, objective and intelligible criteria, the changes that may be made and evaluate the practical implications for them, before entering the contract. In addition, we consider that general fee reviews should be limited to once a year.

4.50 As with variation terms generally, you must also ensure that you provide residents and their representatives with advance written notice of the change in their fees, before it takes effect, so that they are, in theory, genuinely free to avoid it by leaving before the change takes effect and receive a pro-rata refund of any prepaid residential fees.

4.51 We would not object to more frequent changes in a resident’s fees (i.e. not linked to an index) where:

• The resident requests and receives an enhanced service or a better room, provided that:

- what makes it an enhanced service is clearly defined

- the enhanced service is demonstrably different from the service already covered within the standard weekly residential fees

- the resident retains the choice as to whether they want to pay – for example, if someone no longer wishes (or cannot afford) to pay for a better room they should be able to move back to a standard room, when one becomes available.

• The resident’s care needs change (for example, where they will require increased levels of care which mean you incur additional costs in meeting their needs), but residents should also receive a reduction in fees where their care needs reduce. There must be a significant and demonstrable change in the resident’s care needs to justify a increase in price for this reason; where you assess changes by reference to care ‘bands’, these should be limited, and clearly defined according to significant steps in increasing care needs.

What happened

11. Ms Y was in the Care Provider’s care home until her recent death. She was a self-funder. Ms X managed Ms Y’s finances as her attorney.
12. The Care Provider has not provided a written contract with Ms X or a written statement setting out the terms and conditions, including how any changes to fees were to be notified. Ms X told me she never signed a contract. The Care Provider sent me a document called ‘consultation and explanation to care and treatment’ but this is about Ms Y’s mental capacity. It is not a statement of the terms and conditions of her care and is in any event signed by another member of Ms Y’s family. The evidence available indicates there was no written contract.
13. At the start of March 2019, the Care Provider emailed Ms X saying its provisional fee for 2019/20 was going to be £525. Ms X replied saying this was an increase of £46 and she wanted to pay the same as the local authority’s rate – £525. The Care Provider said he could not provide a service at £525. Ms X replied saying she was willing to pay £545 but she may look into alternative care for her mother. In the event, Ms X did not find another care provider for her mother and paid £545 a week to the Care Provider for the financial year 2019/20.
14. In the middle of February 2020, Ms X emailed the Care Provider saying she had decided to move her mother before a proposed fee increase came in. The Care Provider replied asking for a meeting. Ms X replied saying she felt the fee should not change from £545 and noted she was paying more than the local authority’s rate.
15. At the end of February, the Care Provider emailed Ms X offering a fee of £590 and an en suite room. Ms X declined and said she would move her mother elsewhere. The Care Provider asked her to confirm the move arrangements with the manager. The move did not take place, I assume in part due to the first national lockdown. The Care Provider told me Ms X remained in the same room.
16. In the middle of March, Ms X emailed the Care Provider saying the most she could afford was £565. The Care Provider replied saying he would accept £565.
17. In July 2020, the local authority increased fee rate for its beds in the care home, backdated this increase to May and confirmed the increase would run to the end of March 2021. The Care Provider emailed Ms X in August saying that as the local authority had increased its fee rate to £579, it was also increasing its private fees in line with council rates to £604 and it would backdate this increase to May. The Care Provider said this was because of chronic underfunding and COVID-19. In Ms X said £604 was not affordable but she was willing to pay £579. She said she would have liked some warning and was considering moving her mother.
18. In the middle of September, the Care Provider said the new rate was £604 and as a goodwill gesture, he would only be asking for it to be paid from 1 July and not 1 May. The Care Provider continued to email Ms X saying the fee was £604 from 1 July and enclosed arrears letters. Ms X replied saying she had told the director she did not agree to £604 and they had previously agreed a fee of £545 to April 2021.
19. The Care Provider sent a further email saying there was no agreement the fee would remain until April 2021 and that £604 was fair and reasonable. Ms X replied saying the Care Provider’s letter of 10 February 2020 requested a fee of £604 and following that they had agreed a fee of £565.
20. Ms X complained to the Care Provider in September. The Care Provider did not uphold her complaint and said she had agreed to a revised rate of £579 in August and to settle the matter, the Care Provider was willing to accept £579. Ms X replied saying she would pay £579 from 13 September (she had paid £565 up to that date) and would not agree to any increase before that date. Email exchanges continued with no agreement reached. Ms X’s emails indicate she continued to pay £565 until the NHS took over funding Ms Y’s care shortly before her death.
21. The Care Provider told me it believed it had issued a contract for Ms Y’s care but had not retained a copy.

Findings

22. On a balance of probably, I consider the Care Provider did not issue a contract or a written statement of the terms and conditions of service. I find it unlikely the Care Provider would have retained the care document described in paragraph 12, but not a copy of the signed contract. The lack of a contract meant the circumstances in which a review of the fees would take place was not set out and agreed at the beginning of the service. This was not in line with Regulation 19 of the 2014 Regulations and was fault causing injustice. It caused confusion and a lack of transparency about the circumstances in which the Care Provider might seek to increase the fee.
23. The Care Provider initially tried to increase the fees to £604 per week in February 2020 but then agreed a reduced amount of £565 with Ms X in March, only to renege on that agreement and revert to the original £604 per week in August when it also told Ms X it had backdated that increase to 1 May. The records indicate the Care Provider decided to make the increase in August purely because the local authority had agreed an increase which it had also agreed to be backdated to 1 May. That does not, in my view, give the Care Provider the authority to amend the charges for other residents and backdate them, when there was no mechanism agreed under a contract for them to review and when a review had already taken place earlier in the year. I consider the Care Provider was at fault both for not having a written contract with a fee review process and for attempting to backdate an increase when an amount had already been agreed. There is no evidence that the ad hoc increase in August was due to one of the factors set out in paragraph 4.51 of the CMA’s guidance, such as providing an enhanced service to Ms Y or her care needs increasing. As the Care Provider cannot evidence Ms Y required more care, received an enhanced service or had moved to a better room, there were no grounds for it to increase the charge in August 2020 and no grounds to backdate that increase. CMA guidance expects that person should receive notice of any increase and purporting to backdate an increase was therefore fault.

Agreed action

24. The Care Provider will, within one month of my final decision:
• Apologise to Ms X and take no further action regarding the fee increase in August 2020; and
• Make Ms X a payment of £150 to reflect her avoidable distress and time and trouble complaining.

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Final decision

25. There was fault by the Care Provider. There was no written contract for Ms Y’s care and no grounds to increase a previously agreed fee and attempt to backdate that increase. The Care Provider failed to act in line with the law and guidance from the Care Quality Commission and Consumer and Markets Authority. It needs to apologise to Ms X and make her a symbolic payment of £150 for her time and trouble.
26. I have completed the investigation and share a copy of my final decision with the Care Quality Commission under our information sharing agreement.

Investigator’s decision on behalf of the Ombudsman

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Investigator's decision on behalf of the Ombudsman