Financial assessment for care home

Sforzando

Hi there,

Having read some of the other threads on this topic I have been struck by the amount of selfless, patient help available around here, so I'm hopeful. But if this is beyond anyone here I will understand...

To cut a long story short my Dad (who is 60) was incapacitated by a mountaineering accident last summer and now has large-scale brain damage. He is still in hospital atm but is likely to be moved into a care home in the next few months. Mum lives in the jointly owned house. I've read as much as I can about funding care, so I understand about the 23k and 14k thresholds and the fact that any income in Dad's name will be taken away right from the off, but I still have a few questions.

(PS I know there is a chance Dad may be eligible for NHS continuing care so this is in the event that he isn't.)

1) Dad is still being paid, but now it comes out of an income protection scheme his employers took out with CanadaLife (which amounts to about 75% of his old salary). I take it this will still be classed as income and taken to pay for the care?

2) 5 years ago Dad put his company pension into drawdown, withdrew the tax-free lump sum and withdrew a steady sum each month, until about 6 months before the accident when he stopped withdrawing. Will the company pension be counted as a capital asset of his, given that it's in drawdown? Can we take the pension out of drawdown to avoid this happening? Since 50% of the pension of someone in a care home can be passed to the spouse, should we try and find a way of getting an annuity from the pension now?

3) Dad is now on ESA. Will that income be disregarded like PIP is? (None of the AgeUK factsheets mention this.)

4) Currently Dad's salary is being paid into a joint account with Mum. AgeUK said the best thing to do would be to divide the joint account into two individual accounts when the time comes for assessment. I can see why they would advise this, but if we do divide the accounts, is Mum allowed to use some of Dad’s share to support herself?

5) Currently everything that has gone into the joint account will count as joint assets at the point of assessment, and so Mum will get to keep half of it. But after we divide the accounts, then surely any further insurance payouts for Dad's injury (which we are likely to get) will go into his account and be counted as wholly his? If so, then we want to divide the accounts at the last possible moment.

6) Does anyone have any experience with the situation in CRAG guidance 4.002 where the local authority is expected to set aside some money to look after a spouse? Mum also has an £18k mortgage to keep up payments on, and no income of her own, so we are very much hoping the council will do this, and take the mortgage repayments into account as well, but will they?

7) If Dad needs a more expensive home than average because of his medical needs, will the council pay the shortfall, and expect us only to stump up the cost of an average home? (I read this on a website somewhere but can't remember where now.)

Yours hopefully,
Sforzando

Savvy_Sue

Welcome. I wish I knew the answers, clearly you've started consulting the experts, but I wonder if your mum needs to talk to someone face to face who specialises in this area.

Can I just check that Mum or someone else is in the process of applying to the Court of Protection to get authority to deal with Dad's finances, unless he had had had the foresight to arrange for a Lasting Power of Attorney? It can take a while ...

Torry_Quine

Sforzando wrote: »

Hi there,

Having read some of the other threads on this topic I have been struck by the amount of selfless, patient help available around here, so I'm hopeful. But if this is beyond anyone here I will understand...

To cut a long story short my Dad (who is 60) was incapacitated by a mountaineering accident last summer and now has large-scale brain damage. He is still in hospital atm but is likely to be moved into a care home in the next few months. Mum lives in the jointly owned house. I've read as much as I can about funding care, so I understand about the 23k and 14k thresholds and the fact that any income in Dad's name will be taken away right from the off, but I still have a few questions.

(PS I know there is a chance Dad may be eligible for NHS continuing care so this is in the event that he isn't.)

1) Dad is still being paid, but now it comes out of an income protection scheme his employers took out with CanadaLife (which amounts to about 75% of his old salary). I take it this will still be classed as income and taken to pay for the care?

2) 5 years ago Dad put his company pension into drawdown, withdrew the tax-free lump sum and withdrew a steady sum each month, until about 6 months before the accident when he stopped withdrawing. Will the company pension be counted as a capital asset of his, given that it's in drawdown? Can we take the pension out of drawdown to avoid this happening? Since 50% of the pension of someone in a care home can be passed to the spouse, should we try and find a way of getting an annuity from the pension now?

3) Dad is now on ESA. Will that income be disregarded like PIP is? (None of the AgeUK factsheets mention this.)

4) Currently Dad's salary is being paid into a joint account with Mum. AgeUK said the best thing to do would be to divide the joint account into two individual accounts when the time comes for assessment. I can see why they would advise this, but if we do divide the accounts, is Mum allowed to use some of Dad’s share to support herself?

5) Currently everything that has gone into the joint account will count as joint assets at the point of assessment, and so Mum will get to keep half of it. But after we divide the accounts, then surely any further insurance payouts for Dad's injury (which we are likely to get) will go into his account and be counted as wholly his? If so, then we want to divide the accounts at the last possible moment.

6) Does anyone have any experience with the situation in CRAG guidance 4.002 where the local authority is expected to set aside some money to look after a spouse? Mum also has an £18k mortgage to keep up payments on, and no income of her own, so we are very much hoping the council will do this, and take the mortgage repayments into account as well, but will they?

7) If Dad needs a more expensive home than average because of his medical needs, will the council pay the shortfall, and expect us only to stump up the cost of an average home? (I read this on a website somewhere but can't remember where now.)

Yours hopefully,
Sforzando

1 Yes this will be counted as income

2 Sorry , don't know this

3 ESA is counted as income

4 If she uses his income then he will be assessed as if he still has it.

5 Although the default for joint accounts is half each it can be divided differently if it can be shown clearly that one person is entitled to a larger share.

6 Sorry, don't know the answer

7 If he has enough income then he will have to pay the full amount himself and only if it drops will the council step in, even then most of any income is paid to the care home.

Your mum will now be assessed as a single person herself as so may be entitled to benefits in her own right.

I am not an expert so please get proper advice.

Sforzando

Hi guys,

Thanks very much for your replies, much appreciated. I appreciate that 'proper advice' may well be required at some stage, however we are well aware of the costs! I don't suppose anyone knows of an adviser who specialises in the right area?

We will obviously have to look into the drawn down pension in particular.

That's useful to know about Mum being assessed as single - she would at least get JSA. Our biggest concern at the moment is that Student Finance will assess us as having a very considerable household income, whereas in reality we will have next to nothing as everything will have to be spent on the care home!

Sue is surely right about the Court of Protection - however we have delayed going through with this, and not only because of the huge costs. In essence, at the moment, Dad's (reduced) income is paid into the joint account and Mum is able to run the household out of that. However, once deputyship is set up, the accounts will be divided, and Dad's income (not to mention half the savings) will go into his account. Once, as deputy, Mum has guardianship of Dad's half, the question is this: will she be able to use said income and savings to pay half of the household bills and half the mortgage, since that is essentially what happened before? Will she be able to pass a portion of the income over to herself for her and my 17yo sister's upkeep, since that is essentially what was happening before? If not, then she'll have nothing - and you will see why the status quo is infinitely preferable!

It now seems like we will have to get CoP anyway if Dad goes into a care home because then we will have to divide the accounts and we will need deputyship if we want any access to Dad's half at all.

Mojisola

Have you seen the AgeUK factsheets like this one -
http://www.ageuk.org.uk/home-and-care/care-homes/paying-for-permanent-residential-care/

Section 5.2 Income that is partly disregarded.

Savvy_Sue

I wonder if Independent Age would be a useful source of information for you? They seem to have an advice line, and if they can't help with detailed enquiries like this then they ought to be able to point you to 'proper' (ie paid for) advice.

If you are currently a student, talk to your student union's welfare service. You can get assessments made on 'current year' if income has changed radically from the 'normal' year of assessment.

It may also be worth an 'in principle' phone call to the Court of Protection. I think - don't quote me! - that if you have Power of Attorney, you can act as if you were that person, and clearly in that case you'd be able to spend Dad's money the way Dad used to spend it, ie supporting the family. Whereas I have a niggling thought that if you've had to use the CofP route, you must act in the best interests of the person you're acting for. I do not know how this works when the person requiring 'protection' has dependents still dependent on them - but I'm sure you're not alone in this situation! Hopefully IA or the SU can find you someone who has 'gone before', as it were.

Another 'niggling worry' has occurred to me too: one reason why it's SUCH a good idea for people to set up LPA before they need it is that if the banks where mum and dad hold joint accounts realise that Dad has lost capacity, then they can freeze the account in order to protect Dad's interests. I'm guessing that would be pretty calamitous.

I'd therefore suggest that your mum should consider transferring money into an account in her sole name (or jointly with you?) and setting up the household DDs and SOs etc there. If this is a really dumb idea I'm relying on someone jumping up and down and saying so, and I wouldn't even raise it with the CofP, but my reasoning is that even if this is later regarded as deprivation of assets, that would be a better scenario than having all access to funds cut off suddenly.

Just a thought, but presumably all insurance options have been explored? Clutching at straws, but Dad didn't have payment protection or critical illness cover for the mortgage?

And also clutching at straws, I'm guessing Dad is completely without capacity, and could not understand what's involved in LPA in order to set one up? With things like dementia, it can happen that someone has capacity at some times but not others, and as long as it can be established that they have capacity when they sign, that's fine.

Wish I could be more helpful ...

Sforzando

Hi Sue,

Thanks very much and sorry for taking so long to reply.

Got through to someone almost immediately at the CoP which was a pleasant surprise. He confirmed that they do allow people's funds to be used to support dependants, which is good to know!

However we are thinking of just avoiding the hassle of the CoP for the moment and maintaining the status quo, rather than jumping through hoops to get permission to do exactly what we're doing anyway. The bank are aware of the situation and have not frozen the joint account, so we are safe there. Your suggestion would be an excellent one if there was any risk of that happening, but as it is I think we will keep everything coming in and out of the joint account. Care homes sometimes ask for the accounts to be split when it comes to the financial assessment but we will cross that bridge when we come to it!

Afraid Dad is without capacity, but we are getting some very considerable insurance payments.

All the best,
S

Mirador

Hi there, sorry to hear of the difficult circumstances that you are facing. I can't answer your specific questions, but I would strongly advise you to pay for professional advice, as it would appear that there may be significant sums of money involved. If you get it wrong the cost to your family might far exceed any saving made on not taking paid advice. I would suggest that you need to find an advisor who specialise in this area, try https://www.unbiased.co.uk as a start.

From what you said on here, it sounds that there is a strong case for continuing care look at https://www.caretobedifferent.co.uk which explains this is more detail.

cattermole

What a terrible tragedy for your Father, you and all your family. My deepest sympathies.

However I can't see how the Court of Protection can be avoided in the absence of a power of attorney. Particularly if a personal injury payout is likely because this will be covered by the Court of Protection.

The bank should have frozen the account if they are aware of his lack of capacity. I think you /mother will have no option at some point to go the route of the Court of Protection.

Even if he gets CHC it will still be necessary to deal with any of his financial affairs on a long term basis.

Definitely agree you need to get professional advice.