26 July 2018

Knowledge is power – dealing with the CQC

Further to our earlier note on voluntary and involuntary embargos (see link here) we have had a number of requests to summarise the enforcement policy adopted by the Care Quality Commission (CQC) which can create difficulties for both administrators and receivers appointed to health and social care services whilst a buyer is being found.

The CQC has both civil and criminal enforcement powers; the civil powers focus on reducing risks to people who use regulated services, while the criminal powers hold registered persons to account for serious failures.
It is always guided by an ‘enforcement decision tree’, which has four stages:

  • Initial assessment
  • Legal and evidential review
  • Selection of the appropriate enforcement action
  • Final review.

This decision tree is the basement of the enforcement guidance for inspectors.

Initial Assessment

The CQC becomes aware of incidents and events that could warrant civil and/or criminal enforcement action from a number of sources, including notifications by providers, safeguarding alerts, coroners’ reports, complaints etc.

It then considers what response is appropriate; this could entail carrying out a focused or comprehensive inspection, gathering more information some other way, referring the concern or sharing the information of the concerned with another relevant public body or progressing to the next step.

During the first stage, all safeguarding alerts should be reviewed, as should notifications and/or incident reports, and any concerns identified during an inspection should be assessed in more detail before a decision is made.
Where a matter is to be escalated, the CQC will carry out an internal Management Review Meeting (MRM).

The MRM continually reviews decisions about what, if any, enforcement action should be taken and is designed to ensure that there is a documented rationale for all decisions.

The Legal and Evidential Review

Where a case progresses to this stage, the inspector will conduct a legal and evidential review to determine whether there is sufficient evidence of a breach of the legal requirements by a registered person.

This review will be carried out by the inspectors and an inspection manager who will seek advice where necessary (e.g. from in-house or external lawyers).

If the MRM considers that the evidence demonstrates an identifiable breach of a legal requirement and that there is sufficient evidence to prove the breach then the case will continue to the next stage.

Selection of Appropriate
Enforcement Action

In deciding what enforcement action to take, the CQC must consider the seriousness of the alleged breach and the evidence of multiple and/or persistent breaches over a period of time.

Depending upon the seriousness of the identified breach, following a risk assessment matrix, CQC will respond in accordance with the following table:

Seriousness of
the Breach
Recommended Initial Civil
Enforcement Action
Extreme Urgent cancellation

Urgent suspension

Urgent imposition, variation or
removal of conditions

High Cancellation

Suspension

More significant conditions to be
imposed, varied or removed

Medium The imposition, varying or removal
of conditionsSection 29 Warning Notice
(NHS Trusts and NHS Foundation
Trusts only)
Low Requirement Notice

Final Review

The CQC will review enforcement activity as part of developing the coming year’s business plan on an annual basis. Any relevant priorities will be agreed by their board when agreeing the business plan.

We will offer more expert comment upon the specific enforcement action which administrators and/or receivers are likely to encounter in future updates.

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About the Author
Sam Payne, Partner, Head of Restructuring & Insolvency Team
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