The government has hinted it may use legislation to ensure independent sector care providers are bound by the Human Rights Act 1998, as demanded by MPs and peers in a report last week.
The joint committee on human rights said the government's current strategy - of trying to persuade the courts to interpret the Act as applying to independent providers of public services - had failed.
It said legislation specifying that the "public authorities", to which the Act applies, covered independent sector providers, would be necessary to ensure its protections were extended to all service users.
The Department for Constitut-ional Affairs said it would continue with its litigation strategy by intervening in a House of Lords test case next month.
Four care home residents, from Birmingham and Havering, north London, are arguing that their human rights would be breached by a transfer to independent care provision, as planned.
The Court of Appeal rejected the claims, interpreting the Act as applying only to public bodies.
A spokesperson for the DCA said: "The government will consider all available options when assessing how to proceed should this [case] prove unsuccessful."
Further information
The Meaning of Public Authority Under the Human Rights Act