CQC to monitor big providers’ finances to help avoid Southern Cross repeat

The Care Quality Commission will be given powers to inspect the finances of large care providers in a bid to avoid a Southern Cross-style collapse, care services minister Norman Lamb said today.

The government has decided to implement plans, put out for consultation last year, to establish an early warning system to guard against adverse consequences from large providers going bust and ensure that service users have continuity of care.

The CQC will have the power to require regular financial and relevant performance information from large providers, require the provider to develop a sustainability plan to manage financial risks and commission independent business reviews to help providers return to financial sustainability.

“The fear and upset that the Southern Cross collapse caused to care home residents and families was unacceptable,” said Lamb. “This early warning system will bring reassurance to people in care and will allow action to be taken to ensure care continues if a provider fails.”

The Department of Health said the majority of respondents to the consultation had supported the proposal. However, some provider leaders have questioned the necessity of the additional regulation, pointing to the sector’s success in managing the collapse of Southern Cross without people’s care being put at risk.

The regime will be implemented through the forthcoming Care and Support Bill, which will be included in Wednesday’s Queen’s Speech, and is due to be implemented in 2015.

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