The recent Competition and Markets Authority’s (CMA) final guidance on care home contracts (“the Guidance”), clearly presents a challenge.

It also offers a significant opportunity to care home providers to engage with the idea that the residents they look after are also ‘consumers’, not only in the sense of their legal rights, but also in the sense of how they engage with you as advocates as well as purchasers of your service.

It is almost certain that providers will need to revise their contracts in light of the Guidance. Even if the contracts have recently been reviewed, care homes will need to undertake certain steps to ensure that they are compliant, particularly regarding advertising and the initial points of contact between prospective residents and their families and the home. Given that this is a necessity, we suggest that every opportunity is taken to extract as much value from the process as possible. We recommend seriously considering the following issues as part of a review of your approach to your customer contracts.

Stages of engagement

There are, in essence, four stages of engagement with residents and prospective residents, all of which need to be approached in line with your cultural values, as well as the law. The stages are:

  • the initial approach;
  • entering into the contract;
  • managing changes; and
  • bringing the arrangements to an end.

The following features can have a particular impact on how well organisations engage with their customers to provide a positive experience at each of these stages. It is important to achieve a consistent approach to each of the aspects, and a well-thought-through strategy is required. A good experience has the potential to turn those consumers into advocates for your services and, given the importance of recommendations as a source of new residents, this can be a good investment.

The key features to consider are:

  • your website and access to information;
  • how your staff are trained to engage with potential customers – the importance of first impressions;
  • your paperwork – is it user-friendly;
  • how you encourage referrals by satisfied customers; and
  • what your marketing approach delivers.

The extensive range of standard form contracts and guidance and training packages we can offer (which covers every type of care home service whether they are funded privately or by top-ups, local authorities, or CHC and whether they involve a deferred payment, are respite or permanent arrangements) is only part of the service we can provide. Fundamentally, our practical insight into how care services are actually delivered, what matters to customers and how problems are best avoided are more valuable than our ability to produce well-crafted standard documents. We work with our clients to reflect their brand values in the documents we help them develop and do not just deliver compliant paperwork “off-the-shelf”.

Ensuring your contracts are compliant is important to avoid any risk of bad publicity arising from disgruntled customers, but as well as being able to help you to apply the Guidance, we can also provide valuable insights into:

  • the enforcement of standard terms by both Trading Standards and the CMA (both of whom we have engaged with in detail over how they expect providers to approach issues);
  • the difficulties providers get into by failing to have a proper understanding of their contractual rights and obligations; and
  • ensuring that you can recover the fees to which you are entitled (even in the face of reluctant families or intransigent local authorities).

Making a virtue out of necessity is no bad thing, and we consider there is very significant value to be obtained from using the opportunity of the CMA’s work to undertake a comprehensive review of how you engage with your customers and potential customers. If you would like to learn more about our approach, we are running two workshops on the Guidance in February:

Wednesday 13 February
Wednesday 20 February

Further information

We would also be delighted to discuss your requirements for a review of your standard terms and our wider approach. If you would like to do so, or for further information on this briefing, please contact John Wearing or Emma Watt.

Contract management pitfalls – payment
Contract management pitfalls – payment

In the second part of our series on contract management pitfalls, we look at the risks and opportunities presented by payment mechanisms in construction contracts.