What is financial viability?
Implementation of the Care Standards Act could trigger a crisis for care homes which may lead to residents being evicted, according to Keith Lewin, healthcare specialist and partner at Liverpool law firm DLA. “The Care Standards Act 2000 heralds major changes to the way care homes operate,” Mr Lewin said. “Under the new rules, if a home is not financially viable it will have to be shut down regardless of the quality of care it provides. However, the Government has not yet given any guidance on what it deems financially viable.” As many homes are reliant on income from residents who are funded by local authorities, which traditionally pay low fees, owners are concerned that they will not be able to demonstrate financial viability under the new standards. “Many of our clients consider that block contracts from local authorities have had limited scope for fee increases and authorities are reluctant to negotiate higher fees,” Mr Lewin said. “Care Standard 34 is designed to ease the financial pressure on homes by