Dr Peter Carter, chief executive and general secretary of the Royal College of Nursing, said: "For some time we have been concerned about the ability of providers to deliver high quality care and run on a sound financial footing."
He welcomed the push for "robust plans" to be put in place, saying:
When a patient or service user is moved from one care setting to another due to providers failing, it can have catastrophic effects on their mental and physical health. The RCN raised these concerns throughout the passage of the Health and Social Care Act and today's news is a welcome step forward.
It is right that robust plans are put in place to minimise the risk of services failing and that there is scrutiny of their business models. We look forward to seeing these plans in more detail and in particular how they fit in with the Care Quality Commission and Monitor.
More top news
The practice of sending mental health patients far away from friends and family for care has become endemic in the NHS, it has been warned.
Despite the use of combustible cladding in tower blocks, ministers were advised that regulations were tough enough, ITV News has learnt.
A milder night across the north than last night, with rain sneaking into southern Scotland from Northern Ireland.