<p>One of the attributes of a mixed economy of care is that inevitably some homes will go out of business, with consequent costs for the individuals involved and the regulating authorities. However, the rise in home closures during recent years has given rise to concerns about the capacity of the care home sector and the effects on current residents.\ud \ud <p><p><p>This report describes the results of the first phase of a study on the causes, processes and consequences of home closure. A survey of registration and inspection (R&I) units was conducted to identify rates of closure, the proportion of closures that were due to business reasons, changes in registration, the consequences for supply and the views of unit managers. A follow up telephone interview was conducted with those units that covered areas included in a 1996 survey of homes. This interview was used to collect more detailed information about the two most recent closures.\ud \u
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