New warning system for care home failures announced

The government has revealed details of new measures that will for the first time offer protection to people receiving care if their provider fails.

Regulated by the Care Quality Commission (CQC), the new system of national oversight and coordination will give early warnings if a company is in trouble and will ensure the CQC is kept regularly informed about providers' financial stability and overall performance.

Under the new plans, care homes will need to develop and submit a sustainability plan that includes risk management strategies and commission independent business reviews to help them return to financial stability if needs be.

These powers will bring care in line with other services such as hospitals and holiday operators and follow on from a consultation that ended in March 2013.

Care and support minister Norman Lamb said: "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."

This comes after the CQC took charge of regulating NHS GP providers in England for the first time last month.