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| Care homes: Public 'pay unfair fees to plug £1bn shortfall' | |
| (35 minutes later) | |
| Care homes have been applying unfair charges and over-the-top fees for self-funders, an official review shows. | Care homes have been applying unfair charges and over-the-top fees for self-funders, an official review shows. |
| The Competition and Market Authority found some homes had applied large upfront costs and charged families for weeks after their relatives had died. | The Competition and Market Authority found some homes had applied large upfront costs and charged families for weeks after their relatives had died. |
| The watchdog also highlighted how those paying for themselves were charged much more than council-funded residents. | The watchdog also highlighted how those paying for themselves were charged much more than council-funded residents. |
| The average weekly charge for self-funders was £846 - 40% more than local authority rates. | The average weekly charge for self-funders was £846 - 40% more than local authority rates. |
| The CMA said it meant private individuals were effectively paying a multi-million pound subsidy every year to keep the ailing £16bn sector afloat. | |
| It said another £1bn of government money was needed to create a fair and properly-funded system. | |
| The year-long review by the markets watchdog also highlighted: | The year-long review by the markets watchdog also highlighted: |
| More than 400,000 people aged over 65 live in care and nursing homes across the UK. | More than 400,000 people aged over 65 live in care and nursing homes across the UK. |
| Four in 10 pay the full cost of the places themselves. | Four in 10 pay the full cost of the places themselves. |
| The rest receive some help with funding from councils - or in a minority of cases the NHS - as the system is means-tested. | The rest receive some help with funding from councils - or in a minority of cases the NHS - as the system is means-tested. |
| Councils covering the cost of a care home place pay an average of £621 a week - more than £200 less than self-funders are charged. | Councils covering the cost of a care home place pay an average of £621 a week - more than £200 less than self-funders are charged. |
| The CMA said this was because councils had squeezed the rates they paid in response to a shortfall in their national funding. | The CMA said this was because councils had squeezed the rates they paid in response to a shortfall in their national funding. |
| Care homes facing action | Care homes facing action |
| The watchdog is now taking enforcement action against "a few" homes responsible for the most extreme cases of upfront charges and fees being levied after death - some of which have been applied for four weeks. | The watchdog is now taking enforcement action against "a few" homes responsible for the most extreme cases of upfront charges and fees being levied after death - some of which have been applied for four weeks. |
| But it has warned the rest of the sector to take note as the practices could be in breach of consumer protection law. | But it has warned the rest of the sector to take note as the practices could be in breach of consumer protection law. |
| The CMA said it was prepared to take legal action if care homes failed to respond. | The CMA said it was prepared to take legal action if care homes failed to respond. |
| But it also said the government funding system was clearly "not sustainable" and needed to be looked at by the devolved administrations. | But it also said the government funding system was clearly "not sustainable" and needed to be looked at by the devolved administrations. |
| In England, ministers have promised to outline the government's plan by next summer. | In England, ministers have promised to outline the government's plan by next summer. |
| CMA chief executive Andrea Coscelli said: "Without substantial reform, the UK won't be able to meet the growing needs of its ageing population." | CMA chief executive Andrea Coscelli said: "Without substantial reform, the UK won't be able to meet the growing needs of its ageing population." |
| Caroline Abrahams, of Age UK, said the CMA's "devastating report" showed the sector was "broken and living on borrowed time". | Caroline Abrahams, of Age UK, said the CMA's "devastating report" showed the sector was "broken and living on borrowed time". |
| The business practices of some homes were clearly "unfair and exploitative", she added. | The business practices of some homes were clearly "unfair and exploitative", she added. |
| Cllr Izzi Seccombe, of the Local Government Association, said the "stark reality" was that councils simply did not have enough money to pay for places for those entitled to help. | Cllr Izzi Seccombe, of the Local Government Association, said the "stark reality" was that councils simply did not have enough money to pay for places for those entitled to help. |
| She said it was "hugely disappointing" that more money had not been fund in the recent Budget. | She said it was "hugely disappointing" that more money had not been fund in the recent Budget. |
| But the Department of Health said there was already more money being pumped into the system in the short-term. Before the election an extra £2bn had been set aside for the next three years. | |
| "Next summer we will publish plans to reform social care to ensure it is sustainable for the future," a spokeswoman added. |