Elderly are being 'taken for a ride' by care homes charging thousands in hidden fees, health minister warns

Vulnerable elderly people are being “taken for a ride” by unscrupulous care homes charging them thousands of pounds extra in hidden fees, a health minister has warned. 

Care homes have been found to be charging families for care for weeks after residents had died, selling dead residents’ possessions and keeping the cash, and demanding fees for services which were never provided. 

The Competition and Markets Authority (CMA) today ordered care homes to provide the public with upfront and fair information, amid concern that families are falling victim to underhand tactics that cost them dearly. 

Caroline Dinenage, care minister vowed to “stamp out” such malpractices, warning that providers could face criminal investigations if they continue to exploit pensioners.

She said too many care homes were taking advantage of families by hiding fees in small print - including charges which could never be justified - and relying on the fact that families were forced to take decisions at times of “crisis and distress”. 

One care home was found to have been charging residents “compulsory upfront fees” running into thousands of pounds per person - without any clear description of what the funds were for.

Sunrise Senior Living is being forced to pay back over £2 million to residents who were charged a £3,000 non-refundable fee - in some cases even before they secured a care home place. 

Another group running 64 care homes was found to be charging families care fees for a month after residents died, while others included terms in contracts allowing providers to dispose of residents’ possessions and keep the cash. 

Ms Dinenage told The Daily Telegraph: “There is a minority of unscrupulous care providers where vulnerable people are being taken for a ride. This is about stamping down on these practices.”

Care homes have been warned to take immediate changes to contract terms and business places if they are failing to comply with the standards of consumer law.

Providers have been told that information about fees must be prominently available on their websites, explaining exactly what is covered, alongside latest inspection ratings. 

They have also been warned not to bill residents for services - such as on-site entertainment - which is not provided, or to include unfair clauses which allow them to hike up fees without good cause, or notice. 

Ms Dinenage said the new guidance aimed to help ensure families were able to take informed decisions, when they were trying to find a care home for loved ones. 

“These are decisions you are taking at time of stress or crisis, so it is really horrid to take advantage of that,” she said, warning that too many families were being duped by “murky” or “distorted” information. “It makes the process so much more distressing for people,” she said. 

Care homes have been warned that the CMA will carry out a review in 12 months to assess whether they are meeting their obligations. 

Ahead of that, cases found to fall foul of the law could face criminal charges, ministers warned. 

Almost half of care home places in England are “self-funded” by families, a rise from 35 per cent over a decade.

Charities said private payers were being forced to pay thousands of pounds extra to subsidise local authority funded places, where funding was failing to keep pace with demand. 

Research suggests fees for self payers are more than 40 per cent higher than those funded by councils, with the average self-funding resident paying more than £12,000 a year more to have a place in the same care home. 

Caroline Abrahams, charity director at Age UK said too many pensioners were forced to endure “utterly miserable” and “inhumane” situations, and forced to pay a premium to do so.  

“It is the sneaky small print in some care home contracts that really catches some people out, enabling providers to levy extra charges in ways that just don’t feel fair.

“Part of the problem is that the legal rights of care home residents who fund their own care are pretty scanty, in the worst cases leaving them vulnerable to eviction if they – or more frequently their families – are seen to ‘rock the boat’ by making a fuss. It’s high time we gave care home residents more security; the fact they enjoy fewer rights than if they rented a flat is ridiculous and unjustifiable.

Andrea Coscelli, CMA Chief Executive, said: “It’s vital that care homes treat residents and their families fairly, which is why we have issued advice to all homes across the UK to help them understand what they should and should not be doing under consumer law. We’ve already taken action against some providers who charged compulsory upfront fees or continued to charge for extended periods after a resident’s death. We’ll continue to monitor how well care homes are complying and won’t hesitate to take action again if we find evidence that providers have broken consumer law.”