Commissioning Contracts and Fee Disputes

Commissioners of care will carry out contract monitoring visits of services to ensure providers are meeting the terms of their contract. These visits may take place as a matter of course, or because they have been prompted by a safeguarding alert or a regulator visit.

Sometimes these visits are used to try and reduce fees or result in commissioners seeking to cancel the contract based on an alleged breach of contract. Sometimes they will try and remove residents.

Often the actions of the commissioner can influence those of the regulator, and vice-versa.

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Consumer Law for Care Homes  - Validity & Enforceability of Commercial Contracts

The Competition and Markets Authority (CMA) has, in recent times, cast doubt on some terms that are often in contracts between providers and independent paying residents. This includes up-front payments for admission into a home (a “joining fee”) and after death liabilities.

Providers should review their existing agreements to ensure they do not fall foul of consumer law. These contracts usually address medium to long term arrangements so the validity and enforceability of them is important when considering the business security of a care service.

Ensuring that your customers understand proposed terms and commit with informed knowledge is important. Failure to do so could render agreements unenforceable and could result in regulatory fines or claims for damages.

Ridouts can provide advice to providers on these contracts, whether it is a one-off agreement or management of contract arrangements on an on-going basis.

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