Paying for care
Chris Miller looks into the financial and legal aspects associated with care and gives helpful information of what to do when you suspect someone you know needs it
Many people do not think about care until the need is forced upon them.
And few people are experts when it comes to knowing the right sort of care required for their loved one.
Is hourly care sufficient or would live-in care be more appropriate? What does a good care home look like? What should I expect to pay for care and how much is provided by local authorities or the NHS?
What is Power of Attorney and what legal rights does that give me to manage the affairs of someone else?
Doctors and their families are no different to the rest of the population and often experience the same lack of information and advice when it comes to care.
Attendance Allowance
The Government provides funding to help pay for personal care if you are physically or mentally disabled and are over 65 years old.
It is non-means tested and is paid at two different rates depending upon the level of care that you need because of your disability.
From April 2014-15, the lower rate of £54.45 per week is paid for those who need ‘frequent help or constant supervision during the day, or supervision at night’, while the higher rate of £81.30 per week is paid for those who need ‘help or supervision throughout both day and night, or you’re terminally ill’.
Attendance Allowance claim packs are available by phoning 0345 605 6055 or going online at www.gov.uk/attendance-allowance/overview.
You could get extra Pension Credit, Housing Benefit or council tax reduction if you get Attendance Allowance – check with the helpline or office dealing with your benefit.
Personal Independence Payment (PIP)
PIP is a non-means-tested benefit for those with long-term ill-health or a disability between the ages of 16 and 64.
It is based on how the condition affects you, not just the condition itself, with the amount awarded varying between £21.55 and £138.05 per week.
To make a claim, call the Department for Work and Pensions (DWP) on 0800 917 2222 or go online at www.gov.uk/pip/overview.
Before calling, please ensure that you have the following information to hand:
- Full contact details and date of birth;
- National Insurance number;
- Bank or Building Society details;
- Doctor’s or health worker’s name.
Council tax reduction
Someone with a formal diagnosis of dementia who lives on their own is exempt from paying council tax.
If there are two people living in the house, then the council tax is reduced by 25%. If a council tax single occupancy exemption is being claimed, you will not lose this entitlement if you have a live-in carer.
Council funding for care costs
People who are elderly, disabled or have a long-term health condition that needs support with day-to-day activities may be entitled to some financial help from their local authority.
However, any financial assistance is means-tested by the local authority, with their social services department determining whether you’re eligible for funding or not.
In England and Northern Ireland, if you have savings and assets (including property) of more than £23,250 (Scotland £25,250, Wales £23,750), then you will have to pay for your own care.
However, before they can help, your local authority will need to carry out an assessment of your care needs.
It’s called a ‘needs assessment’ or a ‘care assessment’; it’s free and everyone has a legal right to have one.
Only afterwards is there a financial assessment to determine who should pay for any services you might need.
The upper capital threshold for means-tested support will rise to £118,000 from 2016-17, which will therefore increase the number of people who are eligible for social service care support.
One of the aims of the Dilnot Commission on Funding of Care and Support was to protect people from extreme care costs and that there should be a cap on the lifetime contribution to adult social care costs.
Based on the Commission’s recommendation, the Government has set the cap at £72,000 from 2016. In reality, this figure refers only to the social care cost component.
In other words, individuals will still have to contribute to their own living costs, which is a not unreasonable expectation. However, the cost cap is not a cap on what is actually spent on someone’s long-term social care but rather the amount that a local authority would spend on the individual if they were eligible for care through the means test criteria.
This means that a self-funder residing in a more expensive care home will only see their personal cost of care increase each week by the amount that the local authority would spend on them, causing them to spend considerably more on care before they reach the cap limit of £72,000.
NHS Continuing Healthcare funding
This is a package of care that is arranged and funded solely by the NHS for individuals who have complex ongoing healthcare needs in a non-hospital setting.
The service is free, non-means tested and can be delivered at home or in a care home. To be eligible for NHS Continuing Healthcare you must have a complex medical condition and substantial, ongoing care needs.
Just because you have a disability or if you’ve been diagnosed with a long-term illness or condition does not necessarily mean that you’ll be eligible for NHS Continuing Healthcare.
You must have a primary health need where your main or primary need for care must relate to your health, not just having a condition or disability.
There is no definitive list of health conditions or illnesses that qualify for funding and not everyone with ongoing health needs will be eligible. The assessment is usually very strict, and being elderly and frail isn’t enough to qualify.
However, if you are eligible for NHS Continuing Healthcare, the NHS should pay 100% of your fees. There is an organisation called Care To Be Different that helps support eligible families secure NHS Continuing Healthcare funding even when it has been previously declined.
Care To Be Different was set up by Angela Sherman after her marathon three-and-a-half-year battle with the NHS to secure Continuing Healthcare funding for both of her parents. Go to www.caretobedifferent.co.uk.
Financing options for care
Despite this recent focus on the funding mechanism for social care, making it a fairer system for people, there remains significant concern around the poor quality of care delivered, which has received extensive coverage in the last few years.
While the Government has stated the importance of care choices, there is still an alarming lack of awareness of the choice available to people as care needs arise.
Surveys show that most people want to stay in their own homes and have care delivered in the home environment.
The Good Care Group is a national provider of 24-hour live-in care for people in their own homes.
It understands how worrying it can be when planning the financing of long-term care, particularly at a time when you are already facing difficult and highly emotional decisions about care.
It works with Symponia, who are specialists in financial care planning for the elderly through a network of around 150 independent financial advisers around the country.
If your capital and savings and/or income push you over the means-test thresholds for state funding, you will generally need to be responsible for funding.
However, with careful planning it may be possible to structure your finances without having to worry about the future.
Immediate care plans
Immediate care plans – otherwise known as immediate care annuities – are dedicated tax-efficient financial policies specially designed to cover all, or part, of the cost of your spouse, parent or relative’s care fees. The plan will pay an agreed tax-free amount at regular intervals, directly to the care at home or home care provider, for the rest of their life.
Benefits can increase over the years to help keep pace with care fee increases. A lump sum is required to purchase such a plan and this is calculated individually on age and health.
You may be able to financially benefit from releasing an amount of equity in your home. It’s a realistic way to raise capital, income or a combination of the two while continuing to live in your home.
Symponia will be able to advise on both immediate care plans, specific investments and/or equity release. Assuming that there are no unexpected complications, this process should take between four to six weeks.
Care fee insurance
The Association of British Insurers has stated that the new cost-cap being introduced by the Government in 2016 is unlikely to generate a pre-funded insurance market for long-term care, despite Andrew Dilnot’s objective that more people should pre-plan for potential care needs.
This type of insurance has been offered before but with limited success due to lack of demand.
While there is still uncertainty regarding an individual’s future care needs and their associated costs coupled with an unfounded belief that the state provides care free, people are unlikely to take out a pre-funded insurance product to cover long-term care.
Lasting power of attorney
A lasting power of attorney (LPA) is a formal legal document that lets you appoint one or more people known as attorneys to help you make decisions or make decisions on your behalf.
Setting up an LPA gives an individual more control over what happens to them should they have an accident or illness and can’t make decisions at that time.
There are two types of LPA:
1. Health and Welfare LPA. This gives an attorney the power to make decisions about matters such as a daily domestic routine, medical care or life-sustaining treatment. It can only be used when the person concerned is unable to make their own decisions.
2. Property and Financial Affairs LPA. This can be used as soon as it is registered, but only with the permission of the donor. It gives the attorney the power to make decisions about money and property, such as managing a bank account, paying bills, collecting benefits or a pension or even selling property including your home.
LPAs can be made through a solicitor or a registration form can be obtained from the Office of the Public Guardian at www.gov.uk/government/collections/lasting-power-of-attorney-forms.
The donor needs to sign a certificate to say that they understood what they were doing when they signed the form and that there was no coercion of fraud when the LPA was set up.
Before an LPA can be used, it needs to be registered with the Office of the Public Guardian which costs £110 and can take up to ten weeks.
If you need help or advice in setting up an LPA, you can contact the Office of the Public Guardian on 0300 456 0300. Please note that you can cancel your LPA if it is no longer required or you choose to make a new one.
Enduring Power of Attorney
An Enduring Power of Attorney (EPA) is the legal authorisation to act on someone else’s behalf in a legal or business matter. However, on 1 October 2007 the EPA was replaced by the two types of LPAs detailed above.
As such, no new EPAs can now be drawn up. However, one signed before 1 October 2007 and not yet registered may still be registered through the Office of the Public Guardian.
The EPA gives the attorney the power to sell property, manage financial affairs, sign documents and make purchases on behalf of the individual, but not to make decisions about personal care and welfare.
Deputyship under Court of Protection
The Court of Protection is a specialist court for all issues relating to people who lack capacity to make specific decisions. The court makes decisions and appoints deputies to make decisions in the best interests of those who lack capacity to do so themselves.
A deputy would take control of a person’s affairs in the absence of an LPA/EPA or where you have reason to believe that someone is in immediate danger or at risk if you did not act on their behalf. For further information or to download an application form, contact www.gov.uk/court-of-protection.
The court will usually issue your application within one week of receipt and you will receive a letter telling you what to do next.
For standard applications to the court, you should expect to wait to be notified of the court’s decision within 16 weeks of them receiving the application.
Applying to the court costs £400, which must be paid at the time of making the application. The applicant may be exempt from paying the fee if they are in receipt of certain benefits.
You can send urgent enquiries via email to courtofprotectionenquiries@hmcts.gsi.gov.uk or call 0300 456 4600.
There may be an emergency situation that needs an urgent decision, such as when you want to stop someone who lacks mental capacity being removed from where they live. In these situations, you should ask to speak to the ‘Urgent Business Officer’, who will discuss the case with you and make arrangements to receive your application and present it to a judge.
In conclusion, don’t ignore the potential care need for a spouse, partner or other family member.
Too often, we believe that the person concerned can ‘soldier on’ or we do not wish to face the likelihood of their deteriorating health.
Warning signs
We are all invariably busy in our own lives that we tend to put off making a decision on care until we are faced with an emergency.
Look for the warning signs; for example, an increase in the level of forgetfulness where the individual wanders out of the house and can’t find their way home; an increase in falls around the house; not eating or drinking properly leading to weight loss or loneliness and depression.
As a first action, I would strongly recommend carrying out research into possible care even if you don’t need it for months or even years.
Consider the options of hourly care, live-in care or a care home. Explore the costs involved and how to fund care over several years.
Review the need for a Lasting Power of Attorney. Discuss these matters among the family and in particular with the person who may need care to ensure that, wherever possible, they are comfortable with and participate in choosing care for themselves.
Listen to their opinion and act accordingly.
Chris Miller (right) is head of development at The Good Care Group, London