The Care Bill 2014 – Is it a Step in the Right Direction?
For years, the care legislation in this country has made it difficult for people to understand when they should be paying
for their care, and how much they need to pay by way of contribution. In May this year, however the Government approved a Bill
that is hoped to clarify the situation.
The care bill simplifies some of the complexities of the current multiple care legislation, and aims to try to resolve the current crisis in care, not only for the funding of care in a nursing or care home, but also in the provision of services to disabled people and carers. In this article we shall be setting out the key facts
in relation to the payment of care fees.
Currently, a person is deemed as fully funding the costs of their care if they have "assets" in excess of £23,250
. The term "assets" includes bank accounts, investments and property and so for the vast majority of people requiring care, they will be required to fully fund these costs until such time as their assets reduce to £23,250
. At this point, the local authority will assess their care needs and pay towards these, meaning that the person requiring care will contribute towards the costs. When their assets reduce to £14,000
, the local authority will pay the care needs of the person. This may however result in them requiring to move to a "cheaper" care home
if this cheaper home can meet the needs of the person in the same way as their current home can.
The new bill intends to change this. A cap has been introduced for care costs of £75,000
. After this sum has been paid, a local authority may not make a charge for meeting an adult's needs. Therefore, the persons' assets over this figure will be safeguarded and can be used for whatever may be required, such as one to one care, sundries, activities and day trips. For many it also ensures that there will be assets left to pass to their loved ones on their death
, a concern that regularly arises when considering care costs. It is likely that the new cap will be in place by April 2016, but like so much of the new Bill (which will be called the Care Act), the implementation date is yet to be fixed.
On the face of it, this would appear to be a useful piece of legislation, which may provide relief and clarity to many. However, is the Bill all it is cracked up to be?
Based on a report by BUPA, the average length of stay in a care home is 2 and a half years
. The average cost of a care home is £36,000 per year, meaning that a person will only reach the cap on care fees if they exceed this length of stay. Therefore, for many people, they will be fully funding their care
in the same way as they did before the introduction of the Bill. In addition, the criteria for the local authority to pay for costs above £75,000 is narrow; the cap on fees starts from the time a person has an "eligible need"
, and not from when they may first be paying for care.
Helen Forster, Private Client Solicitor commented: "I think we can all safely assume from this that there will not be as many winners as the Government would like us to believe. But as the cap starts from the time a person has an eligible need, people will need to start the assessment process with the local authority as soon as possible
- usually when they are in their own home instead of dealing with matters themselves until further assistance (such as care homes) are required. The new Bill is not going to be of assistance to those who leave it a long time before they are assessed
for care needs, or at the point they move into care. Many of these people will have had care and support needs for many years, and this will not be counted towards the £75,000 cap. In effect, this will be money "wasted" when considering when the local authority will pay for a person's care. The longer a person leaves it to get an assessment from the local authority, the longer it will take to start clocking up the tab to reach the capped figure."
"It therefore remains to be seen whether this new Care Act will be a step in the right direction, or merely a side-step which does not make any difference
If a person requires care, or goes into a care home, usually a family member will take over the management of their day-to-day affairs
to assist their loved one. Legally, this family member will require a "Lasting Power of Attorney" to enable them to manage bank accounts etc. This document can be put in place at any time, is made once, and will last for an entire lifetime
, but needs to be made whilst the person who requires care has the ability to understand and sign the power. Local authorities are encouraged to explain these powers during any assessment; however, for some this may be too late.