Care Home Fees - Who Pays?

EdInvestor

Just to sum up a few issues at this point:

1.Anyone who is dealing with a relative who has to go into a nursing home and will require full-on medical/nursing care ( eg after a severe stroke) may well be entitled to get it all paid by the NHS.This needs investigating as there is evidence the NHS is trying to weasel out of its responsibilities. This may also apply to severe dementia cases who go to residential, rather than nursing homes, and to people who have a medium level assessment but who are likely to get worse and require the full care later on.

2.There is a huge variation in care home fees from around 13k a year to 50k+, so shop around. Most people can afford to pay their own way, using their pension income, Attendance Allowance ( a non-means tested benefit) Nursing care payment from the NHS (if applicable) and perhaps a top-up from savings or part of the proceeds of the house to buy an immediate needs annuity, which guarantees costs are covered for life, delivering peace of mind for a reasonable price. Loss of the house is by no means automatic, so no need to panic over this.

3.Councils all set different maximum levels of fees that they will pay to those who come under their wing (around 40% of the total). But if there is no suitable home at that level of fees, they have a statutory duty to provide proper care and must pay more .If there is no suitable home in the borough, but one next door, they have to pay. So don't be browbeaten by the council, stand up for your (or your relative's) rights. The main difference between self funding and council seems to be that if you pay, you get a private room (and probably a private bath).


4.Couples should divide up their assets between them well in advance of any possible care need.The home should be owned under "Tenants in Common" (simple change can be done with the Land registry on a DIY basis) and then each party should make a will leaving their estate to the other.That means the half of the assets/income owned by the individual not going into care will be left alone in any council assessment.The house does not get touched anyway while the partner or a child over 60 is in it, whatever the ownership structure, but the TiC division is needed for IHT protection as well for those with assets over the exemption level currently 285k (each), so is often doen even if it doesn't impact on the care costs issue.]

5.It is possible (but not IMHO advisable) to further protect the assets against being taken to pay for care, if each partner leaves their share of the home to the children.Thus on the first death, the house would be owned half by the surviving partner and half by the children.The council couldn't take it and sell it to pay for care, as you can't sell half a house.BUT

Warning: This leaves the surviving partner at the mercy of the children's wishes (and/or even their partners or grandchildren if they die/divorce) with no control over where s/he lives, and no ability to move or sell the property to raise a lump sum for extra income without their agreement. This is often needed if the survivor is the widow, because her income will go down. So this is not a wise move IMHO, particularly from the wife's point of view. Apart from anything else, if the survivor has to go into care, s/he may actually want to sell the home and use some of the proceeds to pay for better quality care via an annuity.So best to allow as much flexibility as possible, not lock the survivor into an arrangement which could make his or her life a misery..

Sharpie

margaretclare wrote:

In response to Sharpie, there is no one who could/would take on an Enduring Power of Attorney for either of us. DH would not hear of it in any case, and I have only one daughter who happens to be 250 miles away. So, while there may be some merit in the idea, it's just not practical for us.

I would imagine that the chances of us BOTH becoming mentally incapacitated at the same time are pretty remote anyway, and our affairs are designed and set up to run with as little attention as possible.

Margaret

Just as an aside, its unfortunate that you don't have anyone who can help you out. I have two client couples who are both mentally incapacitated (at the same time) , needing care and the workload to their family (and those giving advice) is now far higher as they have to go through the Court of Protection (who are generally very good, but everything seems to take more time, and has to be approved by them).

Please don't think I'm being nosy, but maybe a discussion with your daughter (even if she does live a long way away) would mean that she would be happy to act for you both- she would be the one who ultimately would be affected, and whilst you may think its not appropriate to ask her, you may be surprised by a nice positive response.

I have an EPA for both my parents and they are 400 miles away, (but both fit at present). I would much rather travel and sort them out if it means that they are getting a better quality of life if necessary, and I am sure that your daughter would feel the same about you!

margaretclare

Sharpie wrote:

Just as an aside, its unfortunate that you don't have anyone who can help you out. I have two client couples who are both mentally incapacitated (at the same time), needing care and the workload to their family (and those giving advice) is now far higher as they have to go through the Court of Protection (who are generally very good, but everything seems to take more time, and has to be approved by them).

No, absolutely not. The idea is a complete non-starter, for more reasons than I stated before. Had my younger daughter still been alive I might have considered the idea, but not now.

Margaret

seven-day-weekend

EdInvestor wrote:

Just to sum up a few issues at this point:

1.
4.Couples should divide up their assets between them well in advance of any possible care need.The home should be owned under "Tenants in Common" (simple change can be done with the Land registry on a DIY basis) and then each party should make a will leaving their estate to the other.That means the half of the assets/income owned by the individual not going into care will be left alone in any council assessment.The house does not get touched anyway while the partner or a child over 60 is in it, whatever the ownership structure, but the TiC division is needed for IHT protection as well for those with assets over the exemption level currently 285k (each), so is often doen even if it doesn't impact on the care costs issue.]

..

We already have wills leaving everything to the other.

If we do 'tenants in common', would we have to do the wills again?

Could you also please tell me how you do it at the Land Registry?

Thanks

Sharpie

margaretclare wrote:

No, absolutely not. The idea is a complete non-starter, for more reasons than I stated before. Had my younger daughter still been alive I might have considered the idea, but not now.

Margaret

I was only trying to help, and I had no idea about your younger daughter..

EdInvestor

seven-day-weekend wrote:

We already have wills leaving everything to the other.

If we do 'tenants in common', would we have to do the wills again?

Could you also please tell me how you do it at the Land Registry?

Thanks

Hi 7DW

Please note I am not a lawyer! Do you have your assets listed separately, such that you can just add a half share of the property to each list?If so probably not.But perhaps better to post on the cutting tax board - see link below- for a response from "elliebean".

Robert Sterling wrote:

I have recently changed from "Joint Tenants" to "Tenants in Common".I got, for £8.50 via the internet, a template of a "Notice of Termination of Joint Tenancy". My wife and I each handed one to each other then put the two of them with our wills.

I then phoned the Land Registry and asked for form RX1
It arrived by post about 18 HOURS later.
I then asked the Land Registry for advice on how to fill it in.
I returned it to them the same day.
They got it the next day and posted a document to me.
I got it the next day.
66 hours from start to finish.

Phenomenal efficiency from the Land Registry.

N.B. This is what I have done. This is not Legal Advice.

See post no 9 on this thread

Post no 2 from Elliebean is also helpful on this issue.

seven-day-weekend

Thanks Edinvestor, I will consult my lawyer.

margaretclare

Sharpie wrote:

I was only trying to help, and I had no idea about your younger daughter..

No offence taken, Sharpie. I realise that a lot of things may seem a good idea in theory, but in practice, with family dynamics, they are not always practicable.

One of my worst fears is that DH dies before me and bro-in-law turns up insisting that he has a funeral in his former religion, even though it says in his will 'a simple Christian service'.....

We have done our best to make everything as foolproof as possible, our affairs are all in order and most things run like clockwork with no need of any intervention. Not like people I hear and read about, who may become incapacitated and can't get to the post office to cash pensions and pay bills...all of that happens electronically and would continue even if we were seriously ill. Our solicitor has a copy of our wishes for a 'green burial' together with letter from the funeral provider confirming that they will provide a 'green burial'. We are still saving because we don't know what our needs may be in the future. We wouldn't have done equity release if Liz hadn't died because the very last time I ever saw her we walked down the garden and I said to her 'This will all be yours one day'. She squeezed my arm and said 'I hope not for a very long time'. A month later she was dead, completely unexpectedly. Once she had gone, there is no point in leaving this bungalow to anybody, and all we really want is a roof over our heads for as long as we need it. No point in going on paying a mortgage until we're 83 just so that *someone* can inherit it. If anything is left it goes to 5 grandchildren, 3 of mine and 2 of his. But even that is inequitable. His 2 granddaughters are unlikely to need anything from him at all, Dad is a high-flyer and they're in private schools. I never hear from my grandson. My eldest granddaughter is still homeless, has only recently started a new job after 6 months on JSA, and if I thought of giving EPA to anyone, it might be to her. If my younger daughter had still been alive, though, I wouldn't have been in contact with any of them, not her sister nor any of the 3 grandkids, because of some acrimonius history between the sisters. So you see, it's not all that simple.

Margaret

morganlefay

My Mum (aged 94, ex-nurse, doctor's widow) has dementia and is in a home, to pay for which we have let her flat and taken an annuity out with a huge chunk of her savings (which is of course what they are for - the rainy day has come) . But Social Services have never once bothered to speak to us or help us in any way - even tho she was in hospital for several weeks with broken femur, and was accused of bed blocking. People with dementia are ILL and in the old days such people would be cared for by the NHS, tho not now. I have fought and fought with the PCT etc etc (I have even written to T Blair) about this but it is an appalling indictment of the way in which the NHS is currently managed, and of our attitude towards mental illness (as in the way in which people with schizophrenia are turned out to roam the streets). Just because there are so many - and increasing- numbers of people with dementia is no excuse for pretending that they aren't there. All over the country people like us are shoring up the NHS, even though recent court judgements have said that making the elderly sell their homes to pay for care is illegal (see the Panorama programmes of about 6 months ago). But it seems the frail elderly and their rellies on their behalf cannot prevail. Heaven help us when we need care - I'm choosing the gutter I'm going to be left to die by the NHS in as I write. :mad:

By the way don't forget that an elderly person can give away a certain small sum of money annually as gifts, and we always make sure our Mum does this because her children and grandchildren are entitled to small sums, and it stops the Inland Revenue eventually getting this very modest amount eventually. If in doubt ask Citizen's Advice as it's complicated.

EdInvestor

Hi morganlefay,

Sorry to hear you've had such a hard time.Hope you're claiming all the allowances Mum is entitled to - Attendance Allowance and payments for any nursing care.

Re giving away money: she can give away unlimited amounts of money from her income on a regular basis (eg Xmas and birthdays) every year - for instance her pension, investment or letting income, if she has a surplus. That's as long as it doesn't impact her normal lifestyle - but that's not an issue really as she's in the care home.

Only 3k, plus the smaller amounts, can be given away IHT free from her capital. Anything else comes under the 7 year rule.