Essex council will face a legal challenge over the fees it pays to care home providers.
Care England, a national membership body for care homes, has won the right to a judicial review after arguing the council breached its duties under the Care Act 2014 by setting fees that fall “significantly below” the costs of providing care.
The local authority said it took its Care Act duties “extremely seriously”.
The case, which will be heard next month, marks the escalation of a row over fees that began last year.
‘Unsustainable and unaffordable’
Last February Essex introduced a new contract for care providers that offered maximum fees of £538.37 per week for care homes and £577.29 for nursing homes.
Months later, a cost of care exercised carried out by the council found a fair rate would be £647 for care homes and £665 for nursing homes. At the time council bosses told providers that paying these rates to all would be “unaffordable”.
According to Care England, most providers in Essex rejected the new contract after deeming the rates offered unsustainable but some felt “under commercial pressure” to sign the deal.
The council offered those who refused to sign up to the new contract a maximum fee uplift of £13.58 to £13.79 per resident per week to cover the cost of the national living wage. The average rate paid at the time was £470 per week for residential homes and £534 for nursing.
“In real terms, if the national living wage cost is stripped out of this nominal increase, the council yet again failed to provide any real term increase on fee rates,” a briefing produced by Care England said.
The briefing said the council had since revised the new contract but the fee rises proposed were “nominal” and fell short of the rates recommended in the cost of care exercise.
Martin Green, chief executive of Care England, said: “We are deeply concerned about the council’s conduct towards the care home market within Essex and as a result, the sustainability of that market.
“We believe the council’s actions to date to be a breach of its responsibilities under the Care Act 2014. This is an important challenge in support of providers in Essex and those new and existing residents receiving care.”
A spokesperson for Essex council said: “In order not to prejudice legal proceedings we are unable to comment on the specifics of this case. We do take our obligations under the Care Act 2014 extremely seriously and are committed to enabling a sustainable social care market.”