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Care Home
Contract Terms
How to ensure your contracts comply with the CMA’s Guidance and enhance your market position.
13 February 2019
YOUR TEAM TODAY
Name Emma Watt
Position Solicitor
Contact Details
T: 0121 214 3609 [email protected]
Name John Wearing
Position Partner
Contact Details
T: 0121 212 7402 [email protected]
Name Natalie Barbosa
Position Senior Associate
Contact Details
T: 0161 470 [email protected]
• Welcome
• Anthony Collins Solicitors LLP
• Our speakers
• Housekeeping
Outcomes for today
• A clear understanding of what you need to do
• Insight into how to meet some of the detailed requirements
• Suggestions about how your organisation might develop your own approach
Our approach
• Our engagement with the CMA Review
• Our experience of how problems arise in practice
• Our approach to delivering value from your contracts and associated arrangements
The content of our presentations
• Understanding where the CMA are coming from and why it matters
• Looking at the CMA’s key concerns
• A methodology for reviewing existing contracts
The content of our presentation
• Using what flexibility there is to your advantage
• Dealing with your non-contractual obligations
• Equipping your managers to get the best results
Key Concerns
OFFICE OF FAIR TRADING(Withdrawn on 2 June 2017)
Excluding/restricting liability
Payments in advance
Cancellation without notice
Hidden terms and ‘legal speak’
OFFICE OF FAIR TRADING
Triggered by ‘super complaint’
Greater focus on Local Authority obligations
Andrea Coscelli:“Some of the most vulnerable people in our society use care homes, often moving to them under extremely difficult circumstances. It’s therefore essential they are able to make informed choices, understand how services will be paid for, and be confident they will be fairly treated and able to complain effectively if they have any concerns.”
DEPOSITS (Reservation)
To hold the room for a prospective resident
Refundable if the resident moves in
Consumer punished (financially) for not moving in
Page 57
DEPOSITS (Reservation)
Room not ready due to provider’s default
At earliest opportunity (first point of contact) before you offer a place
Page 57
DEPOSITS (Security)
To protect against non-payment or damage
Refundable if no sums owed
Consumer punished (financially) for ending the contract or complaining about services
Page 55
DEPOSITS (Security)
Broad or vague discretion to withhold sums or use as punishment in the event of dispute
At earliest opportunity (first point of contact) before you offer a place
Page 55
UPFRONT FEES
To recover costs if a resident does not move in
Consumer feels obliged to move in or cannot engage their right terminate
Page 59
UPFRONT FEES
Don’t charge for “communal” costs
At earliest opportunity (first point of contact) before you offer a place
Page 59
UPFRONT FEES
Demand better assessments
Charge low sum that is not prohibitive
Calculate on an hourly basis using real figures £[AMOUNT]
Use to justify increase in normal rates
Page 59
ANNUAL FEE INCREASES
To cover rising costs and remain competitive
Consumers cannot calculate the cost of their stay
Page 69
ANNUAL FEE INCREASES
Don’t increase more than once a year and don’t give yourself broad discretion
At earliest opportunity (first point of contact) before you offer a place
Page 69
ANNUAL FEE INCREASES
Consider a reasonable and fixed cap (%)
Consider a reasonable and fixed amount (£)
Avoid weighted increases if cannot keep simple
Use a sector specific index
Page 69
OTHER INCREASES (Individuals)
Increase in care needs and/or change in service
Consumers are sold one service and charged for another
Page 74
OTHER INCREASES (Individuals)
Don’t give yourself broad discretion to change
At earliest opportunity (first point of contact) before you offer a place
Page 74
OTHER INCREASES (Individuals)
Clearly explain low, medium & high needs
Keep residents regularly informed
Refer to commissioner for re-assessment
Refund if independent assessor upholds dispute
Page 74
FEES AFTER DEATH
To cover cost of room for interim period
Consumers are paying for services they cannot receive
Page 98Separate Guidance and
FEES AFTER DEATH
Don’t charge deceased’s estate & new resident
At earliest opportunity (first point of contact) before you offer a place
Page 98Separate Guidance and
REVIEWING YOUR CONTRACTSImmediate steps:
1. Update fees after death
2. Check for blacklisted terms
3. Review complaints log
4. Ask managers
Enforcement
Actions
Who may take action aside from CMA?
• Local Authority Trading Standards Services
• Residents/consumers
• CQC
• ‘Compliance partners’ i.e. Advertising Standards Authority
• Ombudsman
• Public funding bodies (your Commissioners – Local Authority etc)
Consumer Protection from Unfair Trading Regulations 2008
• General prohibition on unfairness
• Misleading practices
• Banned practices – 31
• Aggressive commercial practices
• Promoting unfair practices in codes of conduct
Consumer Rights Act 2015• Breach of contract
• Automatically unenforceable terms• Denial of refunds when leaving
• Disproportionate financial penalties for breaching contract
• Changes to contract terms without valid reason
Enterprise Act 2002
• Warning letters
• Undertakings
• Injunctions
• Criminal proceedings
• Enforcement order from civil court
SCENARIOS
1 – Sunrise
Senior
Living
2 –Maria
Mallaband
Care Group
Care UK
We can provide assistance
• Proactive compliance exercise with existing terms
• Prepare responses to CMA / Trading Standards
• Assess strength of CMA case
• Already involved in investigations
Time for a coffee break
Non-contractual obligations
KEY FACTS
On first contact
• Funding (private / public)
• Service
• Ratings
• “Surprising” or important terms
Page 26+
KEY FACTS
Fees• Indicative or average
• Full range
• Service type
• Public funding
• Upfront payments
Page 26+
INDICATIVE PRICING
Care type Floor Service Level Indicative price
per week
Residential Ground Low £750 to £1,200
Residential Ground Medium £850 to £1,400
Residential Ground High £1,000 to £3,000
Dementia with Nursing First Low £850 to £1,300
Dementia with Nursing First Medium £950 to £1,500
Dementia with Nursing First High £1,100 to £3,000
What other variables
influence the price?
Garden-facing?
Room size?
Location?
IMPORTANT INFO
Before you offer a place
• Trial period
• Changes to funding
• Termination rights
Page 42+
IMPORTANT INFO
Before you offer a place
• Business details
• Home away from home
• Copy of the contract
Page 42+
IMPORTANT INFO
Care Home comparison websites
Refer potential customers to your other homes which may be suitable alternatives
Source: www.carehome.co.uk
COMPLAINTS HANDLING
Who handles them? Are they independent?
Methods for reporting and anonymity
Clear and reasonable timescales
Escalation process
Refer to external body
Page 114
“You should ensure that you staff are trained in, andhave a good understanding of, your complaintshandling procedure and how it works. Staff shouldalso understand their role and responsibilities inreporting and resolving complaints, and their role insupporting people if they want to make acomplaint”
Page 16
Equipping your managers
EQUIPPING YOUR MANAGERS(the on-boarding process)
“You are responsible for the actions of anyone acting in your name or on your behalf… You should also maintain effective oversight of the actions of local managers…”
CAPACITY & NEXT OF
KIN
NHS PAYMENTS –
WHO IS RESPONSIBLE?
12 WEEK DISREGARD,
DEFERRED PAYMENTS
AND TOP-UPS
RUNNING OUT OF
MONEY – THE
PUBLICLY FUNDED
RESIDENT
Page 122
EQUIPPING YOUR MANAGERS(the on-boarding process)
• Who signs the contract?
• Who is an authorised person?
• What to do if there is nobody with legal authority to sign?
CAPACITY & NEXT OF KIN
EQUIPPING YOUR MANAGERS(the on-boarding process)
• Understanding the risks & the need for clarity
• The role of financial assessments
• Top-ups
• Guarantee agreements – fair treatment
12 WEEK DISREGARD,
DEFERRED PAYMENTS
AND TOP-UPS
EQUIPPING YOUR MANAGERS(the on-boarding process)
• Local Authority obligations
• Choice of Accommodation
• Enabling the resident & relatives to challenge
RUNNING OUT OF
MONEY – THE PUBLICLY
FUNDED RESIDENT
EQUIPPING YOUR MANAGERS
• “Additional services”
• Funded Nursing Care
• Refunds
NHS PAYMENTS –
WHO IS
RESPONSIBLE?
“Entering a care home is a major decision for those involved, and is often taken at a time of crisis or poor health.”
“People do not, for a variety of reasons, wish to discuss their later life care needs and can be dismissive of the need to do so.”
Pages 21 & 136
Search
Key information
Make contact
Key information
Visit Home & Reflect
Key information
+
Important additional information
Assessment & Offer
Confirm fees and explain terms and conditions
Move In
Update any changes before moving in
QUESTIONS?
Anthony Collins Solicitors134 Edmund Street
BirminghamB3 2ES
United Kingdom
Tel: 0121 200 [email protected]
anthonycollins.com
Twitter: @ACSLLP
Disclaimer: Whilst every effort has been made to ensure the accuracy of these materials, advice should be taken before action is
implemented or refrained from in specific cases. No responsibility can be accepted for action taken or refrained from solely by
reference to the contents of these materials. © Anthony Collins Solicitors LLP 2019
