'Pay When You Die' proposed for elderly needing care

vivatifosi

This is covered in most papers today. Plan is to stop pensioners having to sell house to pay for care. Here's a selection of the coverage (no particular order):

Indie: http://www.independent.co.uk/money/pensions/pay-when-you-die-pensioners-told-loans-to-cover-care-will-stop-them-having-to-sell-homes-7932721.html
Guardian: http://www.guardian.co.uk/society/2012/jul/11/elderly-people-borrow-cash-government?newsfeed=true
FT: http://www.ft.com/cms/s/0/1752b678-caaa-11e1-89be-00144feabdc0.html#axzz20Io8KBRj
Telegraph: http://www.telegraph.co.uk/health/elderhealth/9390844/Pay-when-you-die-solution-for-pensioners-moving-into-care-homes.html

The FT states that the changes are claimed to be the biggest shake up of social care since 1948.

From the Indie article:

Andrew Lansley, the Health Secretary, will announce today that many of the 40,000 old people who have to sell their homes each year will be offered a form of loan through their local authority from April 2015.At present, for the first 12-week period when someone enters residential care, housing wealth is excluded from the means test under which people do not get state help if they have £23,000 of assets. But organising a sale during this period is often difficult and stressful – especially if the person's partner still lives in the home.

The "universal deferred payments" would allow people to delay selling their property for much longer than 12 weeks. Ministers say central government will work out the details with councils and ensure they have enough money to provide a nationwide scheme. Relatively low interest rates are likely, with the "loans" covering the fees recouped when the home is eventually sold or when the person dies. Mr Lansley said the plan will give people greater flexibility. "The last thing people want to think is having to immediately sell their home to pay for residential care," he said.

purch

Ministers say central government will work out the details with councils and ensure they have enough money to provide a nationwide scheme

So, in other words they haven't actually thought it through nor costed it properly yet, and as usual they'll worry about the "details" at a later date.

I guess announcing this today when it might divert attention away from the Lords debacle is pure coincidence

Wookster

It surely seems that deficit reduction has taken a back seat to the popularity contest.

Graham_Devon

I can't seem to get a broad concensus on whether this is a good thing or not.

I can see the government makes money from it, in terms of the interest on the loan. I can see that it may help out a couple where one is going into residential care. I fail to see how it helps out a single elederly person....in this case it appears to be a little pointless.

It's been described so far as the government robbing the graves of pensioners, and the government providing a life line to the vulnerable. Labour appear to be against it, but seem not to be against these proposals, rather against what's already happened and can't really seem to make up their minds as to where they wish to go with this. Bit like me really.

The questions asked by the media appear to all base around "this will save 40,000 people selling their home....is this good". In many cases, the home will never be needed again, so I fail to see how it helps in all honesty having an empty house when you are sat in residential care. Does it not just add to the bills burden? Council tax, meter payment,s insurance to pay etc?

the_flying_pig

seems a great idea to me.

people who really want to stay in their house get to do so. taxpayers aren't unfairly stiffed paying for the care of relatively wealthy people.

kabayiri

I think they should spend time costing out 2 alternatives.

a) Scheme as proposed. A deferred charge covering complete cost of residential care + charges.

b) A one off charge placed on every home whether you end up requiring residential care or not. This charge would be a one off insurance style payment, again deferred on house sale.

My concern for a) is what happens if the equity released from the property does not prove enough ?

ukcarper

Isn’t this a bit like student loans in so much as the money will have to be found now with a promise of it being paid back sometime in the future, what is that going to do for deficit now.

kabayiri

Graham_Devon wrote: »

...
The questions asked by the media appear to all base around "this will save 40,000 people selling their home....is this good". In many cases, the home will never be needed again, so I fail to see how it helps in all honesty having an empty house when you are sat in residential care. Does it not just add to the bills burden? Council tax, meter payment,s insurance to pay etc?

What about a deferral of cost where one person in the household needs residential care much earlier than their partner? Arguably, it's easier to sell the property when neither person will need use of it.

abaxas

My issue with elderly care is there was an offer of help, then people run with that offer and assume it is a right.

Don't bite the hand the feeds you.

Kennyboy66

vivatifosi wrote: »

From the Indie article:

Andrew Lansley, the Health Secretary, will announce today that many of the 40,000 old people who have to sell their homes each year will be offered a form of loan through their local authority from April 2015.At present, for the first 12-week period when someone enters residential care, housing wealth is excluded from the means test under which people do not get state help if they have £23,000 of assets. But organising a sale during this period is often difficult and stressful – especially if the person's partner still lives in the home.

This subject makes me fairly angry - as it seems to me mainly about grasping children wanting to make sure their handsome inheritance is preserved - and little to do about the best interests of their parents.

"When one of a couple enters a care home on a permanent basis the local authority has to disregard the resident’s interest in their former home for as long as the other spouse or partner remains there"

http://www.ageuk.org.uk/Documents/EN-GB/FS39_paying_for_care_in_a_care_home_if_you_have_a_partner_fcs.pdf?dtrk=true

So I'm not sure why the rider - "especially if the person's partner still lives in the home" is in Lansleys statement.

Why shouldn't people be expected to pay for their own care homes ?


And yes I have had relatives have to go into care homes, one of whom any lay person would have thought needed nursing care rather than residential care (nursing care is paid for - but the bar is set high).
I have seen how awful some care homes are & know that to get a decent one your children might have to top up the allowance if the person had no assets.

Kennyboy66

Graham_Devon wrote: »

It's been described so far as the government robbing the graves of pensioners, and the government providing a life line to the vulnerable.

The questions asked by the media appear to all base around "this will save 40,000 people selling their home....is this good". In many cases, the home will never be needed again, so I fail to see how it helps in all honesty having an empty house when you are sat in residential care. Does it not just add to the bills burden? Council tax, meter payment,s insurance to pay etc?

Graham,

Inheritance - thats what its all about - and the petty jealousy that someone poor with no assets gets their care paid for, whilst a wealthy widow with a house has to pay for care and can't bequeath a large sum to her children..