The charity Counsel and Care has called for a national regulator like those for public utilities to be set up to protect the interests of elderly residents.

Counsel and Care general manager Jef Smith said a lot of homes were changing hands from local authorities to big private companies.

Stiff market competition had also led to smaller homes going into receivership as the large companies entered the market.

Driving down fees

In addition local authorities, who often paid for elderly people to have private care, were using their negotiating power to drive down fees, which in turn led to a deterioration in standards of care.

Mr Smith said all the factors combined meant the elderly faced uncertainty about the quality of their care, and whether they could go on living in the homes of their choice.

He said: "This sort of uncertainty and discontinuity must be upsetting. Where people have to move home some will be very seriously set back in health terms and some will die.

"It is very, very disruptive for frail elderly people and people with dementia to have to move."

'No one protecting consumers'

Mr Smith said he knew of one elderly woman whose home has had five changes of ownership in four years.

"There is no one protecting consumers here. Rather like a regulatory body for utilities says whether Eastern Electricity should take over Eastern Gas, we want an overall market regulator for elderly care," he said.

"The marketplace is growing for the care of the elderly. We need someone to look at its overall changing shape, and work in an advisory capacity. There are dangers of unhealthy monopolies and we have to make sure this does not happen."

Counsel and Care is to lobby the Department of Health to take action. The department is currently undertaking a review of the management of care homes.