The Competition and Markets Authority (CMA) has launched court proceedings against leading care home provider Barchester Healthcare.
The watchdog said it was taking the action as a result of Barchester’s failure to address its concerns over its administration and after death fees.
In a letter before action issued in July 2019, the CMA said it believed Barchester was breaking consumer protection law by requiting a substantial non-refundable upfront administration fee from residents for which they received no services or products.
The CMA said Barchester’s description of the charge was misleading and that residents were told about the fee too late in the administration process.
It added that it believed Barchester was charging after-death fees for a period longer than that set out in its guidance.
While noting Barchester had stopped charging the administration fee in January 2019, the CMA said the care home provider had not taken satisfactory undertakings, including provisions for financial redress.
A Barchester spokesperson said: “Having engaged with the Competition and Markets Authority (CMA) on this matter, we believe our approach is the right one and fundamentally disagree with the CMA’s position. We have made some adjustments in line with the industry in changing our upfront admin fees and in the event of the death of a resident, we have reduced the fees to be paid from 14 days to seven days.
“We believe our approach in giving relatives time to make the necessary arrangements, but not to charge for longer than they need the room is the right one, taking everything into consideration. Our position is informed from many years supporting and caring for thousands of residents and their families.”