Care Home Costs Rising

As many as 22,000 older people living in care homes in England get only a week’s warning that their care costs will rise, a new report from Citizens Advice finds.

Citizens Advice’s analysis finds that yearly care home fees increased on average by £900 across England in the last financial year. In one region residential care home fees rose over £2,000 on average in the same period.

Whilst care home fees are usually based on a weekly rate, and often paid for monthly by direct debt, a mystery shopping investigation of 404 care homes across England reveals that almost 1 in 10 (8 per cent) only give a week’s notice that their fees are going to rise.

This means that after the week’s notice that costs will go up, residents have to start paying the higher price, which could cost them an average of £52 extra a month. With many older care home residents or their families paying for the care out of finite pots of money saved up for retirement, cost increases can lead to debt in some cases or, at the extreme end, see residents threatened with eviction if they can't afford the additional costs.

The number of residential care problems Citizens Advice supported people with in 2015 rose by 12 per cent to 8,700. The charity also helped with 18,000 community care problems last year, a 5 per cent rise on 2014.

 Residents or their families have little alternative but to pay any rise in fees because a week does not give them enough time to establish if the fee rise is fair and to negotiate with the provider if it isn’t.

The report highlights that giving residents or their families only one week’s notice before they start incurring extra costs is impractical for those who may need to look for alternative care homes which are less expensive. Moving is often not a viable option because it is too disruptive or distressing for the resident, meaning people have little choice but to pay the higher fees.

Citizens Advice’s research into the care homes market also reveals people paying for care can be made to pay extra, undisclosed costs, either when they first enter a care home or arbitrarily over the time of their stay. These costs are in addition to weekly fees but often are not made clear at the point that people sign the initial contract.

Citizens Advice finds:

• Having someone accompany the resident on visits to the GP or the dentist can cost as much as £50 an hour. 
• Three out of ten care homes (30 per cent) do not include contents insurance for people’s personal items in weekly care fees.
• Two thirds of care homes (67 per cent) do not include telephone use in weekly care fees.

Gillian Guy, chief executive of Citizens Advice, said:

“People in care homes are at the mercy of price rises.

“A week’s notice puts enormous pressure on care home residents or their families to pay. It is unreasonable for vulnerable people to face such a small window to compare costs and make alternative arrangements if they cannot afford the higher fees.

“Some people are also being caught out by hidden extra care fees appearing on their bill. Nobody can be expected to budget for extra costs that are not clearly set out by the provider.  

“There should be a minimum amount of time care homes can give notice of a price rise and the Competition and Markets Authority should look into whether the care home market is working well for people paying for its services. Clearer guidance is also needed on extra care costs so those paying are not landed with shock bills.”

Guidance on unfair terms in care home contracts was last updated by the CMA’s predecessor, the Office of Fair Trading (OFT), in 2003.

The new report recommends:

• Residents or their families to have four weeks notice at the very least that their care fees will rise.

• The Competition and Markets Authority (CMA) looks into whether the care home market is working well and whether people are really able to choose freely between providers.

• A simpler process for people to complain about poor experiences in a care home.

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Anyone looking for care home advice please see: https://www.citizensadvice.org.uk/housing/finding-a-place-to-live/care-homes/