Money: Cares bear down on the elderly

Harvey Jones reports on the problems faced in getting the state to contribute to nursing home fees

IMAGINE having to find up to pounds 30,000 right away. That's the situation faced by anyone with an ageing parent or relative who needs nursing home care. The average cost of care in a home is around pounds 18,000 annually, while employing round-the-clock carers can cost pounds 30,000 a year.

The state will only step in once an elderly person's assets - including investments, savings and the home - dip below pounds 16,000 in value (see box). Around 40,000 people each year are forced to sell their homes to meet care costs. And the problem can only get worse: one in four women who are at retirement age now, and one in six men, will need full-time care at the end of their lives.

No wonder the Government is planning to do something. A Royal Commission looking into the subject of care for the elderly is due to report late this year. One likely recommendation is that we will all be made to enter into a "partnership" with the state. We will be asked to contribute towards care insurance and the state will commit a guaranteed level of funding in return.

In the meantime, local authorities are legally obliged to help with care home fees when people's assets fall below pounds 16,000. Worryingly, some are shirking their duty.

Research from Help the Aged suggests that many elderly people have been forced to raid their savings even when they are eligible for care costs, as local authorities plead poverty.

The charity says its advice line has received more than 2,000 calls about elderly people whose funding has been refused or delayed despite meeting eligibility criteria. Complaints included one from a woman with just pounds 8,000 in savings who was told to pay home fees until her savings had gone down to pounds 1,000. Another woman who had received nursing care for two years and had seen her assets fall from pounds 45,000 to pounds 16,000 was refused help because the local authority claimed other people were worse off.

Some people wonder whether they can simply give their home or savings away to avoid paying for residential care. This is called deprivation of assets and local authorities are wise to this tactic. If someone gives away property or savings in the six months before seeking local authority help, the authority can claw back any care fees from the person receiving the assets. If the transfer of assets takes place more than six months before residential care is needed, the person giving away the assets may be chased for recovery of fees instead.

Financial help depends on an assessment by a representative from the social services department at the local council. You can choose a home for your relative but it must be judged suitable for the patient's assessed needs and should cost no more than the local authority's limit for care costs.

There are long-term care insurance policies on the market but it is estimated that fewer than 30,000 people have bought one. They are very expensive: premiums for a man of 65 insuring for a pounds 1,000 monthly payout towards care costs would cost around pounds 75. A woman would pay pounds 84. If you can, it is worth waiting to find out what the Government comes up with before making any insurance commitments.

q The Help the Aged Freefone advice line is 0800 650065. The charity also has a free residential care information sheet on this number.

Care costs

When will the state help out with care costs ?

q If you have between pounds 10,000 and pounds 16,000 in assets, the local authority only has to make a partial contribution to care costs.

q The proportion you pay is dependent on your combined income and savings. Income includes pension, state benefits and earnings from savings.

q The authority is legally obliged to pay in full when assets fall below pounds 10,000.

q Although the value of the home is usually taken into account when calculating assets, there are some exceptions. It is ignored if a spouse, unmarried partner or relative aged 60 or over lives there, or an incapacitated relative under 60. A local authority does not have the right to assess a spouse's finances.

Start your day with The Independent, sign up for daily news emails
ebooksA special investigation by Andy McSmith
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

SThree: Recruitment Resourcer

£20000 - £21000 per annum + uncapped commission: SThree: As a graduate you are...

Ashdown Group: Junior Application Support Analyst - Fluent German Speaker

£25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...

Recruitment Genius: Customer Service Advisor

£15000 - £16000 per annum: Recruitment Genius: A Customer Service Advisor is r...

Ashdown Group: Trainee Consultant - Surrey / South West London

£22000 per annum + pension,bonus,career progression: Ashdown Group: An establi...

Day In a Page

Syrian conflict is the world's first 'climate change war', say scientists, but it won't be the last one

Climate change key in Syrian conflict

And it will trigger more war in future
How I outwitted the Gestapo

How I outwitted the Gestapo

My life as a Jew in wartime Berlin
The nation's favourite animal revealed

The nation's favourite animal revealed

Women like cuddly creatures whilst men like creepy-crawlies
Is this the way to get young people to vote?

Getting young people to vote

From #VOTESELFISH to Bite the Ballot
Poldark star Heida Reed: 'I don't think a single bodice gets ripped'

Poldark star Heida Reed

'I don't think a single bodice gets ripped'
The difference between America and Israel? There isn’t one

The difference between America and Israel? There isn’t one

Netanyahu knows he can get away with anything in America, says Robert Fisk
Families clubbing together to build their own affordable accommodation

Do It Yourself approach to securing a new house

Community land trusts marking a new trend for taking the initiative away from developers
Head of WWF UK: We didn’t send Cameron to the Arctic to see green ideas freeze

David Nussbaum: We didn’t send Cameron to the Arctic to see green ideas freeze

The head of WWF UK remains sanguine despite the Government’s failure to live up to its pledges on the environment
Author Kazuo Ishiguro on being inspired by shoot-outs and samurai

Author Kazuo Ishiguro on being inspired by shoot-outs and samurai

Set in a mythologised 5th-century Britain, ‘The Buried Giant’ is a strange beast
With money, corruption and drugs, this monk fears Buddhism in Thailand is a ‘poisoned fruit’

Money, corruption and drugs

The monk who fears Buddhism in Thailand is a ‘poisoned fruit’
America's first slavery museum established at Django Unchained plantation - 150 years after slavery outlawed

150 years after it was outlawed...

... America's first slavery museum is established in Louisiana
Kelly Clarkson: How I snubbed Simon Cowell and become a Grammy-winning superstar

Kelly Clarkson: How I snubbed Simon Cowell and become a Grammy-winning superstar

The first 'American Idol' winner on how she manages to remain her own woman – Jane Austen fascination and all
Tony Oursler on exploring our uneasy relationship with technology with his new show

You won't believe your eyes

Tony Oursler's new show explores our uneasy relationship with technology. He's one of a growing number of artists with that preoccupation
Ian Herbert: Peter Moores must go. He should never have been brought back to fail again

Moores must go. He should never have been brought back to fail again

The England coach leaves players to find solutions - which makes you wonder where he adds value, says Ian Herbert
War with Isis: Fears that the looming battle for Mosul will unleash 'a million refugees'

The battle for Mosul will unleash 'a million refugees'

Aid agencies prepare for vast exodus following planned Iraqi offensive against the Isis-held city, reports Patrick Cockburn