Care providers risk loss of care costs

During January 2014, the High Court gave a judgment in an appeal case (Aster Healthcare v Estate of Mr Mohammed Shafi) that has important implications for residential care providers. The decision was that in the circumstances of the case, the provider in question could not recover care costs from a resident’s estate under section 7 of the Mental Capacity Act 2005 (MCA), which provides that the absence of a formal contract does not preclude a claim for payment from a person who lacks capacity, if the services in question are ‘necessary’.

The case demonstrates how a care provider can be left significantly out of pocket, where there is a lack of understanding or clarity around who precisely is liable for care fees.

Where a local authority has placed a service user into a care home in order to meet its statutory duties, and there is no written agreement providing who is going to pay the fees, there is a high risk to the care provider. The decision underscores the point that care providers cannot rely upon section 7 MCA in seeking to claim costs from service users or their estates. Providers need to ensure that they have appropriate written agreements to meet the costs in place, which make the resident (and their estate), or a named representative, liable…

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