Cap on care costs

Wednesday 29 August 2012

The government, in what appears to be yet another U-turn has pledged support to a review by economist Andrew Dilnot on the way care is paid for by elderly individuals in our society. This is weeks after Health Secretary Andrew Lansbury said there was no commitment to finding the money to finance the proposals.

At the present time anyone with assets over £23,250 (including their home) has to bear the cost of their own care, with no help from the Local Authority. Last year more than 24,500 people had to sell their homes to pay the bills – a rise of 20 per cent in a decade.

Mr Dilnot suggested in his review that the government should introduce a cap of £35,000 on how much someone should have to pay towards their care. Any further bills should be met by the government. Under the proposals he also recommended that the £23,250 means test threshold should be raised £100,000. It is understood the Coalition will also honour this proposal.

Senior Coalition sources have said the Prime Minister will find the £1.7billion annual costs of the plan in the next public spending review.

So far so good then, however, there is scepticism about how well these proposals would work in practice.

To start with any reforms would not come into force until after the next election in 2015, meaning tens of thousands of elderly and disabled people will be forced to pay for the help they need.
Leading Tory MP, John Redwood has been outspoken in his criticisms of the proposals. He suggests that many individuals will have to spend a lot more than the care cap before they get help from the government. The cap only applies to care costs, therefore excluding any accommodation bills that the individual would have to pay on top.

Redwood suggests that families should be prepared to use the value of loved ones homes in order to fund their parents’ care, as the only reason they are unwilling to do so is that they want to inherit the house, something he says is understandable, but not something which should be facilitated at the expense of the taxpayer.

The proposals do however have a lot of support from the charity sector. Age UK has said that it believes that the Dilnot Commission report is well thought out and if implemented would prove a game changer for social care and bring clarity and certainty to a system that is currently an unfair lottery.

If the proposals are brought in as they currently stand it could have a big impact on a huge number of elderly individuals lives, ending any worry they may have on how they can fund their care costs.

Should you wish to discuss your future health and welfare, please do not hesitate to contact the Wills & Probate team at Blacks – 0113 207 0000.