Finance for Struggling Care Homes
Whether you have poor CQC ratings or are struggling to manage cash flow, you will need an experienced finance partner on your side.Speak to one of our experts020 4525 5312
Designed For Your Business
- Payments geared to your turnover
- Adverse Credit – no problem
- No Income Proof Required
- Repayment and interest-only available
Finance For Property
- Terms up to 20 years
- £50,000 – No Maximum
- Rates from 2% over base rate
- Up to 80% Loan to Value available
- Answers for all types of challenges
- Solutions tailored to your needs
- Arrangements tailored to your circumstances
- Assets, cashflow, growth capital
Funding for Struggling Care Homes
It is possible to bring a care home business back from poor CQC ratings, but you need to have an understanding of your financial position.
Get the support you need and apply for finance that reflects your care home's current situation and future plans with Rangewell.
Table of Contents
As a care home business owner, you need to ensure your facilities are always meeting (and exceeding) industry standards.
The CQC (Care Quality Commission) is the independent regulator of health and adult social care in England. Health and social care services must meet the necessary CQC standards to provide people with safe, effective, compassionate, high-quality care. A poor CQC rating could mean failure for a care business.
So, what happens if a care home is struggling following a poor CQC review? Low ratings will likely lead to declined occupancy rates and even cause staff to leave for roles at other facilities. In order to remain competitive, and improve your CQC rating, you will need the funding behind you to make the necessary changes to your business.
At Rangewell, we work with care home owners to find and secure the financing they need to support positive cash flow management and grow their businesses. Even struggling care homes can often access care home finance, or refinance existing arrangements. To find out whether you can improve your financial situation, speak to Rangewell's team of expert advisors about your situation today.
Alternatively, keep reading to learn more about the ways in which we can help struggling care access the funding they need to survive and succeed.
What does the CQC rating mean for my care home?
The CQC's role is to drive up standards thought the care industry and general healthcare sector. The body provides guidelines regarding treatment, care and support provided by hospitals, GP practices, dental practices, ambulance services, care homes and home-care agencies. They also conduct regular inspections of practices, homes and facilities.
The CQC’s ‘Ofsted-style’ regime rates practices and businesses on several criteria. In extreme cases, they can place a care provider in ‘special measures’, setting out the stringent health and safety standards that must be met. This gives a clear timetable within which they must improve the quality of care they provide, under threat of further action being taken. In extreme cases, this can include cancelling their registration.
Many businesses are able to act on the demands of CQC, and make the changes and crucially the investments to turn their businesses around. However, in some cases, those businesses that receive a negative response or rating after an inspection do not have adequate resources to respond to recommendations and are left struggling. In some cases, this has left practices with no choice but to close.
Investing in equipment to meet CQC needs
A CQC review will pinpoint equipment shortfalls of all kinds. Inspections will want to see evidence of reliable systems, processes and practices in place to keep people safe.
This includes the provision of adequate equipment, its maintenance and ensuring that equipment is not out-of-date.
Medical equipment that should be subject to regular checks includes:
- Fridges used for storage of medicines
- Nebuliser compressors
- Pulse oximeters
- Electronic ear irrigators
- Portable appliances
The commission may also look at non-medical equipment, such as the catering and seating equipment of care homes.
Asset finance can be the solution that lets you spread the cost of the equipment - or assets - you need. There are several types of Asset Finance:
Hire Purchase allows you to hire equipment until you have paid for it when the items covered become yours. It can spread the cost of items such as seating, beds and tables that you expect to give service for the long term. HP agreements generally last between 12 and 72 months and require a 10-20% deposit plus fixed monthly instalments. A medical bed, a hoist or basic catering equipment might all be bought with hire purchase agreements.
Many medical equipment dealers will offer their own purchase plans to support their sales. At Rangewell we have found that these finance plans often mean paying more for the equipment you need - we can usually find HP arrangements that undercut those offered by dealers.
Leasing operates like a rental agreement. You pay a monthly charge to use the asset. It’s common for things such as large instruments - from ultrasounds and monitors to MRI and Pet scanners with high costs and limited life. Not only does it make multi-million-pound assets affordable, it means you can more easily update your equipment if a new technology becomes available.
You might choose to lease your IT equipment, which can provide the extra peace of mind that comes from knowing if something goes wrong, the lease company can be responsible for dealing with it.
Bringing in and training staff to meet CQC needs
CQC inspection will cover staffing levels and staff skills. All healthcare professionals should have received training to operate the equipment they use. The CQC has produced a raft of detailed regulations which surgeries, clinics, hospitals and care homes must comply with. These include the need to employ suitably qualified and competent staff.
Bringing in trained staff may be costly, and care homes and others that are already struggling may find it difficult to fund additional staffing. Working Capital Finance can provide cash to deal with the large initial costs and overheads of taking on additional staff, from agency nurses to cleaners. It is usually designed to be repaid in the short- to medium-term, once the problem has been dealt with.
Working Capital Finance can also fund training, allowing existing staff to be helped to deliver the standards required by CQC reports.
Bringing in specialist consultants
A number of consultancy businesses exist which provide specialist help for medical organisations which have failed, or are in danger of failing their CQC assessments.
These organisations can bring a wealth of expertise to the work needed to improve a negative status - and move organisations to ‘outstanding’ ratings.
The fee for their services may not be cheap, and it may be difficult to provide from your existing cashflow. However, their services may be key to the continuation of the business.
There are a number of solutions that may be able to provide the support to your cash flow that you need. Funding secured on your premises, on your goodwill and your existing investment in equipment can all provide cost-effective ways to deal with the cost of specialist advice. At the same time, it can be structured to cover the costs of the measure the consultants may recommend.
Get in touch today to talk about large scale funding when a specialist consultant is needed.
How we help you find financial solutions to a negative CQC assessment
Whether you run a single facility or a care home agency, you can run into problems with CGC assessments. Most will be easily dealt with, by understanding the issues raised and changing working practices involved.
However, more serious breaches will require investment. When assessments find that major investment in equipment, facilities and training is required, you must have the most cost-effective source of the funding you need.
At Rangewell, we know the solutions which can help your business deal with the challenges of a negative CQC assessment. We can even provide those solutions if you have a damaged credit history or CCjs, which are often considered red flags by most lenders.
We can do this because along with knowledge of all aspects of business finance, we have experts who work purely in the medical sector.
We know that turning around your business to meet the demands of the CQC may take Several types of investment. We use our expertise to find the most competitive deal for all types of finance, including unsecured and secured loans. As well as conventional loan products, we can help you find Alternative Funding, using new loan providers and innovative funding solutions.
Whether your issues can be solved with a simple quick cash injection, or require a more fundamental approach which demands a complicated ‘Jigsaw’ funding plan made up of a combination of products for the long term, we can work with you to find the answers.
Get in touch with Rangewell today to get our medical funding experts working with you to answer the challenges the CQC presents.
Last update: 23 May 2022
Download Rangewell’s free and detailed guide to Finance for your Care Home
What types of finance are available to Care Homes and business providing residential care?
What is Asset Finance - and how it gives you a business advantage
Can finance help me increase the number of care home places my property offers?
Why not all providers are equal - finding the one that’s right for you
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