Since the Care Act came into force it has been unlawful – and was before that date – for a council to force a person offering a top up to ensure that their relative could be placed in costlier than usual accommodation to make a contract directly with the care home.
The regulations on Choice of Accommodation, and the Guidance make that quite clear. The council must contract for the whole of the placement fee, including the top up element. It is possible for all three parties to agree for practical payment mechanism purposes that the top up contributor should remit the money directly to the care home, and the council and even the client could pay the shortfall after the client’s charges had been remitted separately too, but this is only possible if everyone agrees. Whilst a care home might have been ‘persuaded’ to agree, by dint of the terms of a tender, to be the council’s primary collection agent for these monies, the contract itself as between the care home and the council must ensure that the council is liable of the whole sum.
The old law
The Choice of Accommodation Directions envisage that authorities might contract with the relative in a top-up situation to ensure getting the money back. It seems to us that there is incidental power to do this under the provisions of s111 of the Local Government Act 1972, and ‘consideration’ (a concept from contract law) to support the enforcement of such contracts through the courts. That is because it must be incidental to the provision of ‘choice’ under the Directions to provide for a legal basis on which to secure the contribution, whilst it is consented to. Secondly, the authority is doing more than it is obliged to do by placing someone in posher or better-equipped accommodation than is necessary for the purposes of s21 NAA, so the third party is getting a benefit.
Furthermore, the 1992 Assessment of Resources Regulations as amended clearly assume such contracts will be made, by providing that:
‘a resident shall be treated as possessing any income paid or due to be paid to an authority by a third party pursuant to an agreement between the third party and the authority made in connection with the liability of the resident to pay the authority for his accommodation.’
This provision means in our view that where the authority makes a contract with the third party, the third party contribution could actually be recovered by way of action against the resident, because the provision treats the resident’s means as inflated by the amount of the third party contribution.
Since the NAA provides for agreement by the resident to pay his or her assessed share directly to the home, some local authorities seem to think that it is a good idea to pay the home net of that contribution from the resident, only up to the level of their own cost ceiling, or up to the home’s contractual rate for standard accommodation, regardless of the quality of room actually occupied. Above that, they will invite the relative to make direct contractual arrangements to pay up to the gross contractual rate of whatever is being actually provided. Relatives are sometimes expected to pay their additional sum directly to the provider, for elements such as the view from the room, the location, the gold taps, the en suite bathroom, the lovely furnishings etc., on the basis that those are the elements of the accommodation which make it posher and hence more expensive than ‘standard’, and the elements which have been ‘chosen’. These things are of course, all part of the accommodation provided to the service user.
This has enormously significant consequences for the legality of the arrangements. If there is split contractual liability for the cost of the ‘the accommodation provided’ it means, in accordance with the House of Lords income support cases of Quinn and Steane, that the arrangements in place for the accommodation are not lawful Part III arrangements at all. This would mean:
there would be no right to pursue a liable relative for a contribution to the cost;
there would be no right to pursue a transferee of assets under s.21 HASSASSA 1983;
and there would be no right to write out any form of legal charge over property of the resident in order to protect against debts arising, under s22 HASSASSA or the new s55 Health & Social Care Act.
because all these powers depend upon the accommodation provided being lawful Part III accommodation. Hence all the money being paid to the homes would be unlawful expenditure and the district auditor would no doubt be interested.
We must stress that it is not an unlawful arrangement simply because there may be an informal ‘mechanics’ agreement between the parties for payment direct to the home of the third party’s share. Indeed, since the contribution counts as the resident’s own income, the resident may be asked to agree to pay his share plus the third party’s share directly. The authority is not, however, able to force a third party to make the contribution directly under contract with the provider, and the most obvious implication is that the authority cannot expect the home to pursue third party debts if the third party stops paying. The home is entitled to look to the authority for the deficit, and leave the authority to pursue the third party, if it so chooses. What matters for legality is that there not be split contractual arrangements for paying for any part of the ‘the accommodation provided’. We take the view that the courts would hold that one cannot properly separate the view or the en suite bathroom etc. from the concept of ‘the accommodation provided’, and hence the authority must be liable, in the documentation at least, for the gross contractual rate of the actual room provided.
On the other hand, both relatives and carers (and indeed the resident him or herself) are entitled to pay directly out of their savings or allowances for extra personal items offered by the home, such as aromatherapy, newspapers and hairdressing. These cannot possibly be thought of as part of the care package, for which the authority is responsible, nor part of the accommodation provided, and hence direct contracts can lawfully be made with the home, by the client or the relatives, and enforced by the proprietors.
Homes definitely ought not to be taking a view about the adequacy of service arrangements in the actual care package and asking relatives for more cash when they visit to cover ‘extra care’. If they have concerns about the contents of the care arrangements, then they must raise them with the care manager and re-open the question of the contract price.