/Bupa Aged Care faces ACCC action over alleged false claims at aged care centres

Bupa Aged Care faces ACCC action over alleged false claims at aged care centres

Updated

April 16, 2019 11:56:44

Aged care provider Bupa has been hauled into court by the Australian Competition and Consumer Commission (ACCC) for allegedly making false and misleading claims about the services it provides at nearly a quarter of its facilities.

Key points:

  • The ACCC alleges residents at 21 of Bupa Aged Care’s facilities have been charged for services either never provided or only partially provided
  • The services were often valued at thousands of dollars year
  • Bupa operates facilities in most states, and houses more than 6,700 residents

The ACCC alleged Bupa Aged Care charged thousands of residents at 21 aged care homes across the country a fee for a package of extra, and often expensive, services that it did not provide, or only partly provided.

The allegations cover more than a decade between December 2007 and June 2018 and affect 21 of 74 aged care centres the large privately-owned provider has run in Australia since 2007.

The ACCC alleged the fees for the extra services package often amounted to thousands of dollars each year.

“We took a very dim view of this. This was apparently going on for a long time,” ACCC chair Rod Sims told the ABC.

“To charge people anywhere between $15 and $77 a day — which amounts to $5,000 to $25,000 a year — and not to provide them with all the services that you contracted to provide … I just think smacks of amazing indifference.”

“We allege that Bupa failed to provide or fully provide various extra services promised in residential agreements, but charged for them anyway.

“In some cases the alleged misleading representations related to services that were significant to the quality of life of elderly residents.

“The promised services were likely also what attracted many residents and their families to choose Bupa.”

The ACCC alleged the services charged for but not provided include:

  • “Smart room” systems to assist those living with dementia
  • Air-conditioning in all bedrooms
  • Covered outdoor exercise areas
  • Large talking book libraries
  • Tactile and sensory walkways
  • Fully equipped physiotherapy rooms
  • Separate leisure activity spaces
  • Hot breakfasts
  • Travel escorts for outside appointments

Thousands of residents affected

In all, the ACCC has identified 145 instances it intends to use in its Federal Court action, but said it was difficult to say exactly how many breaches of the law may have been committed.

Technically, each invoice sent to each affected resident over the decade could be deemed a breach.

Given the breaches were alleged to have occurred before changes to Australian Competition Law (ACL), the maximum penalty for each alleged breach is $1.1 million.

Since August last year, the maximum penalty has been lifted to $10 million.

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In precedent ACL cases, multiple breaches have tended to be bundled together by the court.

Bupa’s 78 aged care facilities are located New South Wales, South Australia, Victoria, Queensland and Tasmania, with over 6,700 residents.

The alleged misrepresentation affects 4,306 of Bupa’s aged care residents, the ACCC said.

Mr Sims said tackling consumer issues faced by vulnerable and disadvantaged consumers was an enforcement and compliance priority at the ACCC in 2019.

“Misrepresentations in the aged care sector are particularly concerning, because unlike many other services, it’s often difficult for elderly residents to move to another provider,” he said.

Bupa apologises, offers compensation

The ACCC commenced its investigation after Bupa notified it of the conduct. Bupa has not admitted the conduct contravenes Australian Consumer Law provisions, but is offering compensation to affected residents.

In a statement, Bupa said its internal review “found residents in a limited number of its care homes were not receiving extra services as intended”.

It said extra services were not clinical care or health services, but rather additional “hotel-type” services.

“We apologise unreservedly to those residents and families who have been affected, and we have reimbursed all current residents impacted with interest,” said Bupa’s Managing Director of Aged Care Jan Adams.

“We are committed to addressing this to put things right. Those who may have been affected have been contacted directly by Bupa.

“To date, we have repaid approximately 550 residents.”

Bupa no longer offers extra services in its aged care homes.

The Bupa Aged Care homes the ACCC alleged were affected include:

  • Bankstown, NSW
  • Banora Point, NSW
  • Berry, NSW
  • Dural, NSW
  • Mosman, NSW
  • Queens Park, NSW
  • Sutherland, NSW
  • Tamworth, NSW
  • Roseville, NSW
  • Willoughby, NSW
  • Berwick, VIC
  • Bonbeach, VIC
  • Caulfield, VIC
  • Coburg, VIC
  • Croydon, VIC
  • Donvale, VIC
  • Greensborough, VIC
  • Glenvale, QLD
  • New Farm, QLD
  • South Hobart, TAS
  • Baulkham Hills, NSW

Topics:

aged-care,

courts-and-trials,

company-news,

business-economics-and-finance,

consumer-protection,

australia

First posted

April 16, 2019 10:49:25