What is the cost of social care and is it about to change?
In March 2017, the Conservative Government announced in the Budget that it would publish a Green Paper on social care and a review of the way social care is funded in England. This commitment was repeated in the Conservative Government’s manifesto in the lead up to the General Election in May 2017.
Almost two years on there is still no clear sign when the much awaited Green Paper will be published. In June 2018 the Health and Social Care Secretary announced a ten year plan for the NHS and said that the Green Paper would be published in autumn 2018. It was later promised before the end of 2018 but the latest statement issued by Government suggests “the first opportunity in 2019”.
Wasn’t there a proposal agreed a few years ago?
The future of social care has been a hot topic of debate for many years. In 2009, the Labour Government’s Green Paper proposed a National Care Service and an introduction of a two-year cap on social care charges followed by free social care after 2015.
In 2011, the Coalition Government proposed a cap on lifetime social care of £72,500 and a more generous means-test. These proposals were due to come into effect in April 2016 but their introduction was postponed until April 2020. However, in December 2017 the Government announced that the proposals would not go ahead with the promise of the Green Paper and more generous proposals to come.
What will the Green Paper cover?
The Green Paper will cover social care for adults of working and retirement age. Much of the public discussion about funding for care focuses on care for the elderly but only approximately 34% of publicly funded social care is spent on those aged 65 and over (Institute for Fiscal Studies report May 2018).
The Government states that the Green Paper proposals will “ensure that the care and support system is sustainable in the long term”. Whilst the Paper will look primarily at the funding situation, there are also proposals for integration with health and other services. Housing, social isolation, the role of unpaid carers, care workforces and technological developments are also topics to be covered.
What happens when the Green Paper is published?
There has been no indication as to how swiftly progress will be made once the Green Paper has been published. There will be a full public consultation once the Green Paper is published following which it might be expected that the Government will publish a response to the consultation (a White Paper) setting out how it has responded to the comments and will take matters forward.
How do people pay for social care in the meantime?
Whilst NHS care is mostly free, this is not the case for social care. Instead, a means-test is applied to determine if a person is entitled to receive any financial help from the local authority towards the cost of their care. The means-test differs depending on whether you receive care at home or in a care home setting.
Broadly, a care home resident with capital in excess of £23,250 will not be entitled to financial assistance from the local authority and will have to pay for the full cost of their care. If a person has capital below £23,250 then they will be eligible for financial support but they will still be expected to contribute their income (except for a weekly personal expenses allowance of £24.90), and some of their capital (if in excess of £14,250) towards the costs. The value of a person’s home will be disregarded for the first twelve weeks and sometimes longer if, for example, your spouse continues to live in the home.
For those receiving social care in other settings, such as at home, local authorities can establish their own frameworks for charging. If you are receiving care at home then the value of your property is excluded from the means-test assessment.
The upper and lower capital limits of £23,250 and £14,250 have not been reviewed since 2011 and the weekly personal expenses allowance of £24.90 has remained the same since 2015. Many argue that the failure to review these figures means that more people face paying the full price for their care and there is currently no cap on the amount that an induvial can spend on social care during their lifetime.
If someone qualifies for NHS Continuing Healthcare because their needs are primarily health-related then both their health and social needs are paid by the NHS. If a person is not eligible for NHS Continuing Healthcare but they still have some health needs, the NHS may pay for part of their care. A common example of this is NHS-funded Nursing Care (FNC) which is paid to care home residents who require the services of a registered nurse. The current FNC standard rate is £158.16 per week.
There are a range of carers and disability benefits that can be claimed from the Department for Work and Pensions, including Attendance Allowance which is a non means-tested benefit which can be claimed if you have reached State Pension Age and you have needed help as a result of a physical or mental disability for at least six months.
Are there things you can do to prepare for paying for care?
If someone intentionally reduces their assets to avoid paying for their current or future care needs (known as deprivation of assets), the local authority can carry out the means-test as if they still own any assets that they have spent or given away. The timing and reasons behind any such action will play an important role in the local authority’s decision as to whether deprivation of assets has occurred. There are however steps that you can take that may help to safeguard assets that do not constitute deprivation of assets. For example, a married couple may prepare Wills that pass assets into trust so that, if the surviving spouse needs care in the future, the assets of the deceased spouse are excluded from any means-test assessment.
The system of paying for care is complex and every case is unique. For more information and an informal discussion about your personal circumstances please contact Amanda Attrell, Head of Later Life at Rix & Kay. e. firstname.lastname@example.org