The Patient Safety Authority should be brought in to act as a watchdog over the National Treatment Purchase Fund.
That is the call from Nursing Homes Ireland which says elderly people may be put at risk, because the fund is unaccountable.
The NTPF is charged with reducing waiting lists by purchasing health services from the private sector.
Nursing Homes Ireland says the fund is forcing down the fees paid to its members, and that could have a negative impact on standards.
Tadgh Daly, CEO of Nursing Homes Ireland, said: "The Patient Safety Authority are our health commissioning agency and should be an agency that have oversight and at the moment they are accountable to nobody.
"There needs to be accountability given the health spend and given the amount of people that are cared for by Nursing homes Ireland members across the country."
The National Treatment Purchase Fund (NTPF) issued a statement in response to Nursing Homes Ireland's proposal.
The NTPF has said that a Department of Health review of the Fair Deal scheme in 2015 recommended its pricing system be examined.
They said that Nursing Homes Ireland has already been consulted as part of the review and the NTPF plan to consult the nursing homes sector further.
They said: "The NTPF is a statutory body directly reporting and accountable to the Minister for Health through the Department of Health.
"Its operations are fully reviewed and audited by the Comptroller & Auditor General on an annual basis."
They listed three functions of the fund within the health service:
* Collecting, collating and validating information on persons waiting for public hospital treatment.
* Arranging the provision of hospital treatment for public patients to be treated faster utilising available capacity in private hospitals.
* Agreeing pricing arrangements with private & voluntary nursing homes under the Nursing Homes Support Scheme.
They said: "All funding the NTPF receives to undertake waiting list initiatives is completely distinct and unrelated to its specific work under the Fair Deal scheme."
They went on to say that the NTPF, under the Fair Deal scheme, is solely tasked with agreeing pricing arrangements with private and voluntary nursing homes for long term residential care.
They said: "The NTPF is not a “funder” of residential care. The responsibility for the administration of the Fair Deal scheme and the disbursement of all related funds rests with the HSE. The NTPF has no role or responsibility in the services provided by public nursing homes.
"The NTPF does not set or impose prices. It is a commercially negotiated process based on strict criteria, previous pricing, benchmark prices and cost norms.
"Pricing proposals from private nursing homes for long term residential care are robustly assessed and examined to ensure best value for the taxpayer, while also being fair and sustainable for the operators."
They pointed out that nursing homes are required to provide financial accounts and records to the NTPF to support their pricing proposals which are examined.
They said: "A comprehensive review process is available to private nursing home operators for those rare occasions when negotiations do not reach agreement. This review process has been used just 34 times since 2009.
"Over the same period approximately 3,000 pricing contracts have been successfully agreed."