Who will pay for your long-term care?

Care fees are set to come under scrutiny on Monday when the Commission on Funding Care and Support – led by economist Andrew Dilnot – will report to Government. The report will make recommendations on how to achieve an affordable and sustainable funding system for care and support.

The issue is huge as the cost of care is soaring, yet few people will be able to afford to pay for it themselves, meaning the burden will fall on the state. With one in four people currently expected to face care costs of more than £50,000, that's a huge bill and the question is, who will pay? Leaks suggest Dilnot's report will propose capping individual liability for care costs at £35,000. Above that limit, the state would step in to meet costs of care. In addition, Dilnot is expected to call for a rise in the current threshold of £23,250 personal assets above which the state offers no help with care costs.

"The Dilnot report is long overdue," says financial adviser Philippa Gee, who has just set up a website to help her clients prepare for care fee costs. "We have a crisis of care in the UK that is so severe it could destabilise the NHS completely if not handled properly. There need to be many changes in how care fees are funded and the responsibilities clearly defined for the authorities and the individual."

Gee warns that whatever the final details in the report, the onus of paying for care fees will still fall on the individual. "The report is not suddenly going to come up with a way of providing free care or paying out benefits of £1,000s a month that are not means-tested," she warns. "If you have assets; prepare to use them. If you have a house that will be vacated when you or the person goes into care; prepare to sell it."

It's an important point and one to bear in mind when the undoubted furore accompanying Dilnot's report next week dies down. According to Prestige Nursing, around nine out of 10 of people have not made any financial provision for the cost of care in later life. "The commission must put in real terms how much people will need to pay for care in later life," demands Jonathan Bruce, Prestige's boss. "There is not a care crisis yet, but there will be one if people do not realise that the Government cannot afford to pay for care for everybody and they will be required to make a contribution."

Philippa Gee adds: "The issue of care fees is not going to go away. Get advice, talk it over and take action."

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