Paying Unfair Top-Up Fees? Top-up fees are back in the public domain again as the Competition and Markets Authority (CMA) is reported to have reached an agreement with Care UK to repay its residents more than £1m for unfairly charged top-up fees, in contravention of the National Framework for NHS Continuing Healthcare and NHS-funded Nursing Care.
The CMA contend Care UK had breached consumer protection law by improperly charging their residents an unfair top-up fee towards the cost of their essential long-term complex healthcare needs. It is said that most of the residents were charged more than £300 per week. As a result, Care UK has now agreed to repay more than £1m to 160 residents across at least 20 of its premium care homes by the end of November this year.
You can read the full article here: More that £1m in refunds secured for care home residents
If this applies to your relative and you haven’t been contacted for a refund by the end of November, you can email: CHC.Fundingoffice@careuk.com
In our previous blog: TOP-UP FEES – Unfair Care Home Practices Now Face Government Sanctions (07/12/18) we first mentioned that the newly formed government-backed competition watchdog (CMA) had been set up. The CMA’s guidance, Care homes: consumer law advice for providers gives added consumer protection to residents in care homes. Breaches and infringements can lead to legal action under consumer law and also criminal fines imposed for care homes that do not comply. In particular, under CMA guidance, care homes must give clear, accurate and unambiguous information about the top-up fee arrangements. Transparency is critical. Some examples of breaches include: asking a resident to pay a large upfront non-refundable fee prior to becoming a resident; or insisting on the resident paying a shortfall as a condition of entering the home. We recommend that you read this blog if you think your relative has been charged an unlawful top-up fee , or visit their website: https://www.gov.uk/government/organisations/competition-and-markets-authority
This latest outcome indicates that the CMA are now flexing their muscles and are expected to investigate other care homes who may have also breached the rules set out in the National Framework for NHS Continuing Healthcare and NHS-funded Nursing Care rules. This could result in millions of fees that were unlawfully charged being refunded to residents.
This latest success for the CMA will undoubtedly send deep shockwaves throughout care homes in England and Wales, as many have been getting away with charging residents unlawful large upfront or top-up fees for years. We suspect many residents didn’t know what the additional charges were for, nor that they were actually unlawful.
This is great news for thousands of current and past residents in care or nursing homes who have been improperly charged and either coerced or deceived into paying additional top-up fees for their essential healthcare needs in contravention of the National Framework rules.
What are the National Framework rules about charging top-up fees?
The National Framework for NHS Continuing Healthcare and NHS-funded Nursing Care makes it quite clear that when an individual is awarded NHS Continuing Healthcare Funding (CHC) all the cost of their assessed healthcare needs (including social care needs) and accommodation, should be paid for in full by their local Clinical Commissioning Group (CCG). Paragraph 180 of the National Framework sets out the core tenet that CHC is ‘free at the point of delivery’ (ie when it is needed):
“180. NHS care is free at the point of delivery. The funding provided by CCGs in NHS Continuing Healthcare packages should be sufficient to meet the needs identified in the care plan. Therefore it is not permissible for individuals to be asked to make any payments towards meeting their assessed needs.”
So, if CHC is supposed to fund the whole care package, free of charge, why are elderly and vulnerable residents in care homes being charged any additional fees?
These additional charges are often referred to as ‘top-up’ fees and are usually paid in relation to the cost of essential care, or more typically, for accommodation. Where a resident has CHC Funding in place it is unlawful for care homes to charge top-ups. Some, however, are quite open about it and make no bones that they are charging a top-up fee to meet the cost of living at their home. Transparent? Yes – but it still could be unlawful! More commonly, most care homes try and disguise this payment and call it something else such as a ‘personal contribution’ – perhaps deliberately trying to conceal the unlawful nature of its true identity. Whatever description is applied, if they relate to the individual’s assessed healthcare needs it is unlawful – as funding should be met in full by the CCG, not by the individual. This is why the CMA outcome against Care UK will have care homes nationwide running to re-examine their contracts and charging structures, and getting busy redrafting.
It is, however, permissible for care homes to charge ‘top-up’ fees for additional non-related healthcare needs such as social care needs; for example, manicures, pedicures, hairdressing, physiotherapy (sometimes referred to as hotel or spa-type services), or for personal preferences eg choosing to have a non-standard/larger room or one with a better view and amenities or luxuries. Top-up fees that relate to a personal ‘want’ rather than actual healthcare needs, are lawful, and your relative will have to pay for that preferential choice.
Why do care homes charge top-up fees?
The answer is quite simple. It’s all to do with cost.
The care home will have a contract with the CCG which is likely to pay them a fixed rate for the individual’s assessed healthcare needs at that home. If the costs of keeping the resident at the care home are more than they are being paid by the CCG, someone has to foot the bill for any shortfall. Care homes are businesses, too, with staff, grounds and usually high overheads. That all has to be paid for if the care home is going to maintain standards and not cut corners, avoid a CQC investigation, and moreover, stay open for business.
When challenged about top-up fees, care homes typically raise excuses such as:
- it was your choice to place your relative in our care home;
- this is what it costs for your relative to live here;
- this is a high-end care home in an expensive residential area which costs more. You could always move to a cheaper home down the road;
- you knew what you were paying for at the outset, so why are you now surprised by these additional charges?
If the current package of care funded by the CCG is insufficient to meet the individual’s increasing healthcare needs, then the care home should approach the CCG on behalf of the family for a reassessment and seek an increased package of care that more accurately reflects the true cost of that person’s care. For example, if more staff are required throughout the day and night to manage their challenging behaviours or complex healthcare needs, then that cost should be passed on to the CCG, not the individual. However, what happens in practice can be very different. Rather than contact the CCG to increase the care package, it is far simpler to take a direct approach and ask the family to pay (ie top-up) from private means instead. They are a captive audience and, of course, want their relative to be looked after in a secure, caring environment. So, for obvious reasons and to avoid confrontation, many will pay the asking price, thinking that is the norm. They are in a vulnerable position and just want peace of mind. In most cases, the top-ups can be very substantial – amounting to many hundreds of pounds (eg Care UK charge £300 per week). We have known top-up fees to be much higher. But, when multiplied over a number of months and years, can make a huge hole in your relative’s finances. Some care homes may also insist on taking security to guarantee payment eg a charge over your relative’s home.
What to look out for
Families often complain that their relative is being charged additional fees, but they have no idea what for, and tell us the care home is not providing anything extra or different from any other resident.
If this sounds familiar to you:
- Check what the contract with the care home says about charging.
- Check the invoices and annual payments. Has the cost gone up without explanation?
- Does the invoice or contract blatantly refer to charging a ‘top-up’ fee or use some other description to try and conceal that it is really a top-up fee by another name (eg ‘personal contribution’)?
- Was the contract fully explained to you and did you understand what you were signing?
- What were you told or what justification was given about being charged additional fess over and above what the CCG are paying the care home for CHC?
- Did you feel forced or coerced into paying these additional charges?
- Was payment a condition of keeping your relative in the care home or were you ‘threatened’ (expressly or by implication) that if these charges weren’t paid, your relative couldn’t stay and would be put out onto the street?
- Was your relative offered a choice of different levels of room (eg ‘superior’, ‘deluxe’ or ‘standard’) and did they choose a better standard of room or were all the rooms exactly the same? If they chose a better than standard room eg bigger with better facilities/view, then unless it is specifically required for their assessed healthcare needs (common examples include wheelchair access and use of a hoist) the care home can charge this extra cost.
What can you do?
If you think your relative is charged unlawful top-up fees, then if you feel confident to do so, you should consider raising the issue with the care home manager. Request an explanation as to what these charges relate to, and if it appears they truly are unlawful top-up fees, ask why they have been charged in contravention of the National Framework, and seek a refund.
If it’s clearly an unlawful top-up fee, don’t accept the usual excuses that “this is what it costs to keep your relative here…”
You can always threaten to report the matter to the CCG if you feel their actions are contrary to the National Framework, and point out that the CCG may remove them from the list of approved care home providers.
Try contacting the CMA and request that they carry out an investigation as to any unlawful top-up fees. However, the CMA can only secure refunds dating back to 1st October 2015.
The care home is unlikely to take kindly to being challenged on the matter. This is a very specialised area and we recommend you seek legal advice. Visit our one-to-one page for details.
How far can I go back to claim?
Unfortunately, the position is not very clear.
Now that the CMA are now aggressively operating in this area, it may be a question of making a complaint to them and letting them investigate the matter for you.
Under the National Framework there is no time limit. The Framework merely provides guidance that such charges are unlawful, but it doesn’t necessarily give rise to legal action in itself.
Whilst we don’t give legal advice. Generally speaking, if you want to bring a legal action yourself to recover the care home fees in court, under the Limitation Act 1980 there is a 6 year period within which your claim should be settled, or court proceedings should be issued to extend the life of the claim beyond this date. This 6 year period usually starts from the date of the contract or from when the last payment was made or when you discovered the mistake. It really depends on the individual facts and circumstances of each particular case. However, we recommend that you seek legal advice to make sure you are in time to claim.
If your contract was more than 6 years ago, and your last payment was also more than 6 years ago, and you only discovered the extra charging after 6 years, then it is unlikely much can be done.
If your contract was more than 6 years ago, but your last payment was made within the last 6 years, you may still be in time. However, if you have delayed pursuing a claim, then you might be out of time and statute-barred, too.
The matter is complicated and is an area where we strongly recommend you seek legal advice if you wish to pursue a legal action as the matter is not clear cut.
For additional reading: Are You Paying Top-Up Fees Unnecessarily?
If your relative has been charged an unlawful top-up fee, tell others what you did and how you handled the situation and whether you were successful in getting reimbursed…