Part of the CMA’s investigation focuses on the terms of contracts entered into when family members enter a care home. The watchdog is concerned that homes may be breaking the law by charging large upfront fees when it’s not clear what services they relate to. The inquiry is also looking at cases where care homes continue to collect fees after the person in care has died. In some instances homes are filling beds still being paid for by other families, it is alleged. Ray Hart of Valuing Care said the bigger issue was homes’ ability to raise charges by as much as they like. “There are cost pressure on them of course but basically these are open-ended contracts and each year they can raise the cost by as much as they like and they don’t give breakdowns explaining the increases.” Read the full article here

Middle-class families who have to pay for their own care are not merely subsidising council-funded residents but becoming the sole source of care homes’ profits. This means that previous calculations of the “self-funder tax” – the difference between fees paid by private residents and fees paid by councils – have been hugely underestimated. Ray Hart, a director from Valuing Care Ltd, said: “Everyone points to councils’ underfunding of care home places, but the reality is different. The profit motive of these businesses is working its way into the system as well.” Read the full article here

One 95 year-old nursing home resident has seen her fees rise 129pc, with barely any explanation Dr Edmondson (pictured) calculates that his aunt Eunice will have spent £600,000 on her care home fees over 13 years Read the full article here

Choosing a care home for a loved one can be an emotional experience, so the idea of having to do so twice is a worrying prospect. It is becoming more likely, though, as increasing numbers of residential homes find themselves in financial difficulty, putting them in danger of closing. Wilkins Kennedy, an accountancy firm that deals with insolvent companies, says the number of care homes that have gone bust has risen by 12pc in a year. The firm blames cuts at local authority level, which have left an increasing number of care home operators unable to service their debts. Sixty seven care home businesses failed in 2012, compared with just 28 in 2008.

The widening gap between the actual cost of providing a place in a care home and the fees charged to those who pay for themselves is clear in figures published by the Telegraph today. They show that on average those people who fund their own care – because they do not qualify for assistance from their local authority – pay on average 13pc above the “real cost” of providing their care, in England. The “real cost” figure, which is generated from in-depth research from Valuing Care into the constituent costs of providing food, accommodation and basic help, also includes a reasonable profit margin for the care home operator. The conclusion, highlighted in a separate report by charity Independent Age, also published this week, is that middle-class residents with modest property or other assets, who are thus forced to pay for their own care, are further subsidising those paid for by the public purse. Read the full article here