Barchester consumer protection case

First published by Author on August 01, 2019 in the following categories: Care Homes Pricing and tagged with care home | cma | investigations | pricing

The Competition and Markets Authority (CMA) is taking action in the Barchester consumer protection case under the pretence that consumer laws may have been broken.

The wider action surrounding care homes in the UK has been going on for over two years now, and we recently reported about the court action launched against Care UK.

Now, the CMA has sent a letter before action to Barchester Healthcare Limited, Barchester Healthcare Homes Limited, Grove Limited and Barchester Holdco (Jersey) Limited; known altogether as ‘Barchester’. It’s alleged that certain fees that have been charged contravene consumer protection laws.

About the Barchester consumer protection case

The Barchester consumer protection case involves allegations that certain fees charged by the company may be breaking important consumer protection laws.

The fees in question are understood to include:

• Non-refundable administration fees that have been charged upfront and are alleged to have been misleading;
• Fees charged after a resident’s death.

In terms of the upfront fees, the CMA has said that these fees are allegedly charged without any form of service or products actually issued in return. Information about what the fees are for is reportedly unclear, and consumers are understood to have been informed about the existence of these fees too far along the process.

It’s also alleged that fees charged after a resident has passed away are being charged for periods that exceed the CMA’s guidance.

Why the CMA’s taking action

It’s understood that the administration charges in question were stopped in January this year following the recent industry reviews and undertaking requests. However, the CMA say that they have not been provided with satisfactory undertakings, and this includes compensation for consumers who have been charged certain fees.

As such, the letter before action that has been issued in the Barchester consumer protection case is a warning that court proceedings may be commenced if the necessary steps aren’t taken.

With the scale of this one, we’ll be continuing to keep a close eye on events and developments. Court action may become necessary as it did in the Care UK case, and we’ll be watching closely for updates.