Mr Dobson told MPs he had asked the Royal Commission chaired by Sir Stewart Sutherland, principal and vice-chancellor of Edinburgh University, to report back within 12 months on ways of dealing with the problem of paying for means-tested long-term care.
"As far as where the funding should come from, the matter is open," he said. "It seems to me fairly likely that in the end there will be a proposition that some of the funding should be by the individual and some by the taxpayer. I am not telling them to come to that conclusion but I will be amazed if they don't."
Des Le Grys, chairman of the continuing care conference, an umbrella organisation for carers and insurers, said private insurance was likely to be recommended with public sector support.
He said it was unlikely the Royal Commission would revive the Tory government's plans for insurance to cover the asset value of people's houses, but a new insurance scheme would need policing. Help the Aged said the commission needed to end the confusion facing the elderly.
The 300,000 elderly in homes have to pay their own bills for long-term care if they have assets worth more than pounds 16,000. Mr Dobson confirmed a White Paper next year will set standards for domiciliary care.
A draft Tory Bill would have allowed the means test to disregard assets worth pounds 1.50 for every pounds 1 covered by insurance, but it fell with the Tory government at the last election.
The Liberal Democrat spokesman on health, Simon Hughes, was assured by Mr Dobson the commission would look into the quality of care in old people's homes.
Members of the commission will include: Claire Rayner, the broadcaster; David Lipsey, political editor of the Economist; Sir Nicholas Goodison, former chairman of the Stock Exchange; and a number of medical experts, but it does not include the lobby groups.
- More about:
- Homes For The Elderly With Nursing Care
- Liberal Democrat Party
- University Of Edinburgh