Social care funding under the spotlight again

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The issue of adult social care funding caused controversy in the 2017 general election campaign with Theresa May being forced to row back on plans to overhaul the system and its funding. As another national poll looms, the policies put forward by the main parties on this subject that won’t go away will be scrutinised once again.

A key aspect of any proposals will be how to provide for the 850,000 people in the UK who have dementia. The Alzheimer’s Society states that the average cost of a nursing home place is nearing £1,000 per week and that the typical cost of dementia care for one person totals £100,000.

Public Health England has recently identified that almost 80% of those with the condition are coping simultaneously with a significant health problem, such as heart disease or epilepsy, or recovering from a stroke or a fall. The combination of these issues frequently accelerates the need for individuals to access residential care. And, at this point, the question of funding becomes an issue to consider.

If the person entering care lives in England and has assessable assets between £14,250 and £23,250 then they will share responsibility for their care costs with their Local Authority. Anyone with assessable assets above the £23,250 threshold is responsible for their costs in full. The Local Authority will make a maximum contribution to the care costs of those with assessable assets of less than £14,250 but with the shortfall to be covered by the person receiving care.

Clearly, therefore, going into residential care involves a sizeable financial outlay and seeking advice is recommended. For some, it may be appropriate to sell their house to pay for the care. Naturally, many people would want to avoid this measure, in which case, a second option would be to rent out their property to maximise income. However, the full value of the property is still included in the financial assessment.

Alternatively, a deferred payment agreement (DPA) can be set up. This allows the property owner to keep their home for a longer period and is, essentially, a loan secured on the property. Under the agreement, the Local Authority foot the bill and place a charge on the property. Eventually, when the time comes to sell the house, the debt built up will be repaid including interest which is currently set at around 2%. The potential advantage to be gained by establishing a DPA is that if property prices increase from that point, this balances out the final debt owed.

Regardless of which option is chosen, a Local Authority will fund the initial 12 weeks of care without any repayment being required.

Whilst care provided in a residential home will not be free for the vast majority, there are some circumstances where state funding is provided. If a person’s needs primarily involve nursing, then care and accommodation costs may be covered by ‘NHS Continuing Care Funding’ following the appropriate assessment.

If NHS Continuing Care Funding doesn’t apply, then limited financial assistance may be available in the form of NHS-funded nursing care which consists of a flat-rate weekly contribution paid at a standard or higher rate.