UK: Care Homes Brief

Last Updated: 21 May 2013
Article by Catherine Drew

Rise in the number of care homes going bust

The number of care homes businesses going bust has increased from 35 in 2010 to 67 in 2012, according to accountancy firm, Wilkins Kennedy. Nearly 250 operators have closed in the last five years. Local authority cuts (referrals and rates) mean a number of care homes are struggling to maintain high standards of care and/or service debts taken out during the boom years. The Independent has estimated that approximately £5bn of debt has been built up by the larger care home operators prior to 2008. The regulatory standards within which care homes operate mean that they often have less flexibility to reduce costs to match falling revenues. The Government announced on 3 May 2013 that large private care providers will have their financial records regularly scrutinised in future to spot potential business problems.

Social care costs cap brought forward & the new Care Bill

The Government recently announced that its proposed overhaul of social care funding will be brought forward from 2017 to 2016. This reform is focused on removing the need for people to sell their own homes or lose their assets if they develop serious care needs rather than introducing more money into the system. The cap will only cover the social care costs (e.g. support for washing and dressing) and not the so-called "hotel" costs such as food and rent. In addition, the cap will not be calculated as a simple amount of money but will be done using the standard fee which the relevant local authority would pay for the care needed by that person. Any extra amount would have to be funded by the individual or their family. The Government have indicated that the rules will be changed to permit such "topping up".

The new Care Bill (to apply only to England) announced in the Queen's Speech did not refer to the amount of the cap (but the previous announcement said it would be set at £72,000). The new Bill will also give carers the legal right to support from their local council and everyone a legal entitlement to a personal care budget to spend as they wish. An Ofsted-style rating is also to be introduced for care homes. Residents of care homes and their families can currently rate care homes via the NHS Choices website: Research by the Association of Directors of Adult Social Services suggests that the social care budget is likely to be cut by £800m in the next 12 months (after a cut of nearly £2bn in the past 2 years) despite the likely increase in eligibility as a result of the cap, estimated at an extra 450,000 people. The previous announcement also indicated that the upper limit for care home residents in England will be raised to £123,000 whilst the lower limit is expected to be raised to £17,500. But no further details are yet available.

New law to jail care home bosses who mistreat the elderly

The Sunday Times recently reported that owners and directors of care homes where elderly people are abused could face jail under a new law making them accountable for neglect and mistreatment. Care homes that cover up incidents of neglect or mistreatment could also be prosecuted under the new "duty of candour" for staff. The new rules are expected to be outlined in a consultation by the Department of Health (DoH) in the forthcoming weeks. The Care Bill will also provide protection to people whose care provider goes out of business and create Health Education England and the Health Research Authority to prove additional training and support for health professionals in England.

Labour to launch a health and social care commission

Labour has announced that it will seek to establish an independent commission to investigate how best to integrate health and social care. Labour believes that, without such co-ordination, there will be a £29 billion gap in the health budget by 2020. The NHS currently meets medical care costs but social care costs are met by local authorities if private means are not available. This has led to "bed blocking" in some areas as local authorities have delayed taking responsibility for their care by leaving elderly patients in NHS beds. This split in responsibilities is historic but has led to concerns that the system is inefficient and wastes money and does not provide appropriate care and support for those most in need, particularly given the projected demographic changes.

Majority of Deprivation of Liberty cases unreported

A report by CQC has said that almost two thirds of applications to restrict a person's liberty under the Mental Capacity Act (MCA) were not reported to it as required by law. In some cases, patients had their freedom removed for months at a time. Lawyers representing people with mental disabilities suspect the numbers may be far higher because some care homes (and hospitals) are restraining people without using the safeguards.

Court of Protection

There have further complaints in the press about the secrecy surrounding the Court of Protection's role under MCA as the guardian of the interests of those deemed unfit to look after their own affairs. Wanda Maddocks was sentenced in her absence by the Court (and then jailed) for contempt of court because she removed her elderly father from a care home where he had been placed against the family's wished by local authority social workers. Details of her conviction were not made public for six months.

Dementia care - new NICE guide

The National Institution for Health and Care Excellence has recently produced its first social care guide - "Supporting People to Live Well with Dementia" - setting out the standards expected from care providers for dementia sufferers. It indicates that people with dementia should be involved in decisions about their care and must be helped to maintain relationships and to participate in their communities.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.