Pensions and Care Home Fees

Alibert

If you go into a Care Home , and being assessed financially to see what contribution you have to make then my understanding is

If you are receiving DB pension payments or payments from an annuity these are counted as income and you will have to contribute to care home fees out of that

If you have savings, including ISA you will have to use them to pay care home fees

But if you have a DC pension pot then it's not part of your assets in the same way, so they cannot force you to use it to contribute to care home fees.

If it's in drawdown then taking any cash out would be pointless as it would be income from which you would have to pay care home fees . But they can't force you to take any money out

Am I right ?

If so it's quite an incentive to avoid annuities, and to transfer out of final salary schemes into draw down.

Or am I wrong

xylophone

See https://www.pensionwise.gov.uk/en/care-costs

Linton

You are wrong. Councils dont force you to pay for care, they merely say they wont pay for it if you have sufficient assets. Whether and how you then choose to pay for it yourself is up to you, your PoA, or the courts.

Paul_Herring

Whether and how you then choose to pay for it yourself is up to you, your PoA, or the courts.

You seem to have sneakily omitted 'try to get everyone else to pay for you anyway, even if you could self-fund' out of your list...

Silvertabby

Untaken pensions - be they DC or DB - are only ignored until State pension age.

You are right when you say that 'they' can't make you actually draw pension benefits at any time - but after that date they can and will take your (even if unclaimed) pension income into account when assessing you for means tested benefits/care home fees.

lisyloo

If so it's quite an incentive to avoid annuities, and to transfer out of final salary schemes into draw down.

It's a minority who go into care homes and generally only for a limited time.
Doesn't seem a strong basis on which to make plans to me.


If you own property and you live on your own then that would be taken anyway. It would be disregarded if your spouse live in it, but who knows if they will or won't be around.

lisyloo

Do also be aware that state pension, NHS funded nursing care and attendance allowance count as well.


My MIL is currently looking at fees: £825 per week


state pension: £200
NHS funeded nursing care: £160
attendance allowance : £85


So she is ONLY looking at paying £380 per week.

Alibert

Assumed annuity .. so that's how it is done
Clever.

Without delving too much into an emotional area I don't really understand the psyche of the British public who fight passionately for the idea that everyone with (say) cancer is entitled to extremely expensive treatment to extend their life for a short time, but equally passionately believe that those with (say) vascular dementia should pay for the care they receive .

lisyloo

who fight passionately for the idea that everyone with (say) cancer is entitled to extremely expensive treatment to extend their life for a short time, but equally passionately believe that those with (say) vascular dementia should pay for the care they receive .

People with cancer often do not get extrremely expensive treatments with little clinical value on the NHS, if they do it's often because they have signed up to a medical trial. The difference you are talking about is essentially medical needs vs personal needs.
My MIL is in the latter category and does get a contribution towards her medical needs (funded nursing case £155 per week) which means she can be in a home with nurses on hand 24/7.
Personally I am grateful for the free carers, free NHS care and free nursing home care she's had and have no issue with the fact that she now has to pay (since her husband's death).


The bottom line is that if we as a social want expensive treatments and quality care then we have to be prepared to meet the bill one way or another.

Paul_Herring

The difference you are talking about is essentially medical needs vs personal needs.

There's also the numbers (people and money) involved. To topic-drift for a moment towards an analogy...

'Free' university education a few decades ago could be covered by the public purse because proportionally fewer of their peer group actually went, and when there studied largely useful subjects.

Now that 50% of them a year are entering university to study Underwater Basket Weaving, Feminist Studies, and The Politics of Harry Potter via the Medium of Interpretative Dance, the public purse cannot bear the cost.

lisyloo

Well exactly, we have an increas8ng number of people requiring personal care as fewer die from heart attacks, strokes and cancer.
It cannot be paid for out of the public purse without more going in.

It!!!8217;s a myth that all health care is free.
It!!!8217;s rationed by postcode and clinical need/value.