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Health and social care inspectorate body the Care Quality Commission said they were "appalled" by the Serious Case Review into the deaths of five residents of Orchard View care home, and admitted they did not act quickly enough.
They were criticised by the coroners report into the death for giving the home a "good" rating a year before shutting it down.
Chief Inspector Andrea Sutcliffe said the blame for the "sub-optimal" care lay with those working in the home.
Ms Sutcliffe admitted the Care Quality Commission missed early warning signs, and did not act quickly or strongly enough. She said:
The independent chairman of the Serious Case Review into a Southern Cross run care home said he supported calls for an independent care home sector to be placed under the same as care under the NHS.
Publishing the findings of the review, Nick Georgiou said:
"A number of the concerns identified in the recent past with hospital services in the NHS have been echoed at Orchid View and it is right that the scrutiny and demands for improvement in the NHS are also expected from the independent sector.
"As a result of the concerns about the NHS there have been recent government consultations relating to a duty of candour, the fit and proper person test, and a new offence of wilful neglect where people have mental capacity.
"This Serious Case Review wholeheartedly supports them being applied to independent sector businesses and organisations.
"As the role of independent sector care businesses has grown, the number, frailty and vulnerability of people dependent on their care has increased.
It is critically important that these services demonstrate that they can provide the quality of care necessary. In this case the service provider failed."
Expert lawyers and families whose loved ones endured ‘institutionalised abuse’ at a Sussex care home welcomed the Serious Case Review published today as a step forward for the care industry but warned that its recommendations must now be delivered to prevent further widespread abuse.
West Sussex Adult Safeguarding Board commissioned the review after an inquest into the deaths of 19 residents at Orchid View Care home in Copthorne but some of the families of those who died say they are frustrated at a continued lack of accountability for the neglect their loved ones suffered.
The home closed in October 2011 and re-opened under new management in February 2012 as Francis Court but lawyers are concerned that in October last year the new home was also criticised after a Care Quality Commission (CQC) inspection.
A Serious Case Review will be published today after five elderly people died after suffering neglect at Orchid View care home in Sussex. It's been labelled "Britain's worst care home".
Following a five-week inquest last October, coroner Penelope Schofield heavily criticised the quality of care at the Southern Cross-run home in Copthorne. Failings included a lack of respect for the dignity of residents, poor nutrition and hydration and mismanagement of medication.
Ms Schofield said at the inquest's conclusion, "There was institutionalised abuse throughout the home...Those who did nothing or turned a blind eye should be ashamed. It is disgraceful that this home was allowed to be run in the way it did and run for nearly two years."
The inquest looked at the deaths of 19 pensioners at Orchid View after whistleblower Lisa Martin contacted police to raise concerns. The coroner ruled all of these residents suffered "sub-optimal" care but five of the residents died from natural causes "which had been attributed to by neglect".
The home was shut down in late 2011 after an investigation by the CQC.
A serious case review will be published today into why a number of residents died at a care home in Sussex.
The review looked into whether Orchid View in Copthorne neglected residents, which in turn resulted in their deaths.
Families of those who died will meet with the review chairman.
Latest ITV News reports
More than 30 recommendations have been made in a Serious Case Review, looking at the "institutionalised abuse" at a care home in Sussex.