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CQC warns of disruption to allied healthcare services

Care Quality Commission writes to 84 local authorities to warn of "credible risk of service disruption"

Published on 16th November 2018

The Care Quality Commission has written to 84 local authorities warning of a potential disruption to allied healthcare services.

The formal notification to local authorities - which indicates the highest level of risk to the provision of allied healthcare services - comes after care provider Allied Healthcare announced its intention to apply for a Company Voluntary Arrangement (CVA) in April this year to restructure its debts.

Andrea Sutcliffe CBE, Chief Inspector of Adult Social Care at the Care Quality Commission (CQC), said: “Allied Healthcare has been able to confirm funding until 30 November 2018. However, we have not received adequate assurance that the company has, or will have, the ongoing funding or new investment necessary to ensure the business can operate beyond this date."

“It is now CQC’s legal duty to notify those local authorities where Allied Healthcare is contracted to deliver home care services, that we consider there to be a credible risk of service disruption," she added.

However Allied Healthcare slammed the decision as "premature and unwarranted".
The CQC said that after Allied Healthcare announced its intention to apply for a CVA in April this year to restructure its debts, they monitored the situation through CQC’s Market Oversight function, and assessed the future viability of the company’s plans to determine whether continuity of care can be maintained for people who are receiving home care services from this provider.

However, it said that while Allied Healthcare has been able to confirm funding until 30 November 2018, the CQC has not received adequate assurance that the company has, or will have, the ongoing funding or new investment necessary to ensure the business can operate beyond this date.

"We have encouraged Allied Healthcare to provide us with a realistic financially backed plan to support the future sustainability of the business, and given them every opportunity to do so, but they have failed to provide adequate assurance regarding future funding," said Ms Sutcliffe.

"We are doing this now to give local authorities as much time as possible to plan for maintaining continuity of care for people relying upon services from this provider, should this be required. Local authorities have a statutory duty to ensure continuity of care for everyone using an adult social care service in the event that it ceases to operate," she added.

Allied Healthcare is one of the largest home care providers in England and one of 59 adult social care providers within CQC’s Market Oversight Scheme. CQC’s Market Oversight function monitors the financial health of the largest and most difficult to replace providers of adult social care in England because of their size, which represents about 25% of the adult social care sector.

Last week, Caroline Dinenage, Minister of State for Care, told Parliament: "Yesterday, in line with duties set out in the 2014 Care Act the Care Quality Commission notified 84 Local Authorities that they were issuing a Stage 6 notification for the homecare provider, Allied Healthcare."

"A Stage 6 notification is intended to be an early warning to local authorities that CQC consider that the business failure of a provider in their area is likely and this could lead to services ceasing for people who receive care from that provider."

"The Care Quality Commission has not taken this decision lightly. They have continued to monitor the financial sustainability of Allied Healthcare since it secured a Company Voluntary Arrangement in May. It has been speaking with Allied Heathcare’s senior management team on a regular basis to seek assurances about the company’s performance and the sustainability of its future finances. The company has not been able to provide the necessary assurances beyond 30th November 2018 and the Care Quality Commission has taken this prudent action in order to give local authorities the time to prepare their contingency plans to ensure continuity of care, in the event that it is required.

"Allied Healthcare can take action to reassure the Care Quality Commission of its financial position beyond 30 November 2018, in which case the Care Quality Commission would revise their position accordingly. The Care Quality Commission is clear that there is no current service disruption. Allied Healthcare remain responsible for these services and their staff," she added.

A statement from Allied Healthcare said: “We are surprised and deeply disappointed by CQC Market Oversight’s decision, which we regard as premature and unwarranted.

"We have demonstrated throughout our discussions with the regulator that Allied Healthcare’s operations are sustainable and safe, that we have secured a potential replacement of our credit facility, that there is no risk to continuity of care and that we have a long-term business plan in place that will continue to deliver quality care across the UK.

"The CQC has disregarded these assurances in spite of the robust evidence we have provided.

"By issuing a Stage 6 notification, the CQC is putting significant pressure on already stretched and pressurised local authorities and clinical commissioning groups.

"Continuity of quality care is our number one priority. We will continue to provide the services entrusted to Allied Healthcare and will work closely with all commissioners of care throughout this period," the statement concluded.

The CQC said it will continue to work closely with Allied Healthcare and all of our partners  – the Department of Health and Social Care (DHSC), the Local Government Association (LGA), the Association of Directors of Adult Social Services (ADASS) and NHS England (NHSE) so they can inform the organisations responsible for commissioning people’s care – to make sure appropriate action is being taken in the interests of people’s continuity of care if this proves necessary.


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