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Elderly care shakeup: how will it work? Elderly care shakeup: how will it work?
(2 months later)
What's on offer?What's on offer?
This government has essentially taken the system proposed by the economist Andrew Dilnot, with a cap on costs of care, a limit to so-called hotel costs, and raising the level of assets required. The cap on care costs is set at £72,000 – almost double Dilnot's preferred figure of £35,000 once you account for inflation.This government has essentially taken the system proposed by the economist Andrew Dilnot, with a cap on costs of care, a limit to so-called hotel costs, and raising the level of assets required. The cap on care costs is set at £72,000 – almost double Dilnot's preferred figure of £35,000 once you account for inflation.
How does it work?How does it work?
The government proposals – and Dilnot – were not designed to underwrite private care homes. They would only pay out on council rates. Currently local authorities pay about £500 a week for residential care and hotel costs. If hotel costs are capped at £12,500 a year – £240 a week – that leaves £260 a week for individuals to find from their own pockets for care, until they spend £72,000. That would take about five years. Most people stay in care homes for between two and three years. Even if you were to spend five and a half years in a home, the government will only provide £260 a week as a subsidy. Because many people face substantially higher care home bills, they could be in for a nasty surprise.The government proposals – and Dilnot – were not designed to underwrite private care homes. They would only pay out on council rates. Currently local authorities pay about £500 a week for residential care and hotel costs. If hotel costs are capped at £12,500 a year – £240 a week – that leaves £260 a week for individuals to find from their own pockets for care, until they spend £72,000. That would take about five years. Most people stay in care homes for between two and three years. Even if you were to spend five and a half years in a home, the government will only provide £260 a week as a subsidy. Because many people face substantially higher care home bills, they could be in for a nasty surprise.
Don't we get this free?Don't we get this free?
Under the current system you only get free elderly care if you have assets of less than £14,250. For every £250 in assets – including homes – the state can charge a pound in contributions – up to a maximum of £36 a week, when you will have £23,250 in assets. Above that, the state says you have to pay. Under the new thresholds, the elderly could face contributions of about £400 a week.Under the current system you only get free elderly care if you have assets of less than £14,250. For every £250 in assets – including homes – the state can charge a pound in contributions – up to a maximum of £36 a week, when you will have £23,250 in assets. Above that, the state says you have to pay. Under the new thresholds, the elderly could face contributions of about £400 a week.
Will I have to sell my home?Will I have to sell my home?
The government will introduce a national deferred payment scheme, part of a package of measures proposed by the Dilnot commission a year ago. This will allow local authorities to agree to pay in advance for care if individuals cannot afford to do so without selling their homes. Councils recoup the cash when the house is sold.The government will introduce a national deferred payment scheme, part of a package of measures proposed by the Dilnot commission a year ago. This will allow local authorities to agree to pay in advance for care if individuals cannot afford to do so without selling their homes. Councils recoup the cash when the house is sold.
What if only one of my parents has to go into care?What if only one of my parents has to go into care?
The government will not look at housing assets if one member of a couple goes into care. Instead, the taxpayer will stump up the money for those with less than £27,000 in the bank.The government will not look at housing assets if one member of a couple goes into care. Instead, the taxpayer will stump up the money for those with less than £27,000 in the bank.
Why is this an improvement?Why is this an improvement?
The government will help you get a cheap loan to borrow money against the value of your house. It will compel local authorities to get self-funders' care at the same low cost as it pays. By setting a national minimum level of eligibility, it will end the postcode lottery of social care provision that exists today. The government will help you get a cheap loan to borrow money against the value of your house. It will compel local authorities to get self-funders' care at the same low cost as it pays. By setting a national minimum level of eligibility, it will end the postcode lottery of social care provision that exists today.
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