Symponia, of which I am a Master Practitioner member, is an organisation that is dedicated to providing impartial, generic advice on all aspects of care planning and creating the most effective care fee plans.
If you go to their website Symponia Care Fees Adviser and use the "find your local member" my details will appear if you put "SK" or "North West England" into the relevant search options.
That means I have had to satisfy their stringent standards of approval and confirm that I have the knowledge, experience and personal qualities to match their critical levels of service and assurance.
There is a very informative Symponia Care Fees Planning Handbook available to download. If you prefer a hard copy rather than downloading it, feel free to contact me and I will gladly send you one. This is a valuable guide that clearly explains all about the different types of care available, how best to fund it, property questions and current legislation and what it means to you.
Proposed Changes - March 2013
Governmental spending cuts, are as predicted, having far reaching effects on public funding, which sadly, includes Local Authority contributions for elderly care. Interestingly the means-tested capital thresholds have been frozen for a third consecutive year in England & Northern Ireland.
Most people in the UK know that the funding of adult social care needs to be adapted and overhauled. Back in March 2010, the Labour Government unveiled a White Paper, instigated the Big Care Debate and launched the details for a National Care Service - this actually had a lot going for it, but sadly its proposers lost the general election and the shiny new transformation was condemned to the waste bin.
Instead of continuing with the National Care Service, the new Coalition, wanting to make its own mark, asked economist Andrew Dilnot to revisit the subject and on the 4th July 2011 he reported back his findings. Almost two years and lots of speculation later, Jeremy Hunt responded in February and confirmed that the Government was adopting some of the proposals put forward by Mr Dilnot. The outcome at the time was that the much talked about "care cap" was to be introduced in 2017 and set at £75,000 which was more than double the maximum originally suggested. During his Budget speech on 20th March George Osborne confirmed that care cap will be introduced in 2016 and reduced to £72,000, at the same time the upper threshold will be increased to £118,000.
On paper, it looks much more complicated than the existing system with more parameters and not much in the way of additional benefits, certainly in the shorter-term of a residents stay in a care home. As such, the majority of self-funders now will continue to be self-funders even after their care cap has been exhausted.
We have identified the three most likely scenarios to help to explain what could happen.
. If a person has assets above the new threshold when care is needed, then they will be expected to pay for their own care fees as they do now.
. The start date of their care account will be subject to an eligibility criteria based on an individual's care need and the prevailing local authority rate.
. If the total prevailing local authority rate is for example £500 per week, the amount contributing towards the care account will be £500, but the amount deemed non care related will be deducted.
- The non-care related figure is likely to be £230 per week
- This amount is derived by applying the living expenses budget set by the government at £12,000 per annum
- Therefore £500 - £230 = £270
- Using this calculation a person's care account will accrue at £270 per week
. It isn't unusual for care homes to charge significantly more than £500 per week, which means that any amount above the local authority rate remains the responsibility of the individual and won't contribute towards their care account.
. When a person has spent their £72,000 care account, the government will step in and start contributing £270 on behalf of the individual.
- Up until that point is reached the individual will have to pay the full cost of the care home fees.
- After that point the individual will still have to fund all the care costs above £270 per week.
. Using this scenario it would take a person 266 weeks (5.1 years) to reach the limit of their care account.
. Similar to the current situation, there may be non means tested benefits which can be claimed to help with ongoing care fees.
. If a person has assets less than £118,000 at the outset then the care account is incidental. It doesn't apply to them as they will be funded by the local authority but subject to tariff income (see below), much like residents with capital below the current threshold now.
. In addition to the capital assessment the local authority will still carry out an income means test.
. This income assessment includes the application of what is known as "tariff income".
- The current level sees people charged £1 per week of income for every £250 of assets on amounts
falling between the upper and lower thresholds.
- The future level of tariff income after April 2016 is still to be decided by the government.
- If it remains at the current level an individual could be asked to pay a maximum of £404 per week
(although this will reduce on a weekly basis).
. So whilst the upper threshold seems high, people are only guaranteed to be able to retain £17,500.
. Those residents funded by the local authority have been given a promise that they won't need to spend more than £12,000 per annum as a contribution towards their living expenses.
. If a person starts off as a self-funder, say with modest assets of £150,000, and they meet the care criteria, then they will start off reducing their overall care cap.
. But once their assets reach £118,000 the care cap calculations will stop and they will start to receive LA contributions - just as in scenario two.
What is vitally important to acknowledge is that once on the statute books, the new regime is not scheduled to come into force until 2016 and many of the details of how the system will work are still to be decided.
The current overriding message is that the system will remain complex even after 2016 and families of people in care now shouldn't put off planning for the continued and indefinite funding of their relatives care fees.