Nursing home fees + annuities – advice sought

Mr_Dufray

Hello. Our 81-year-old Mother (I am one of her three children in their fifties) lives is in an HC-One nursing home at a yearly cost of around £55,000 plus private therapy support and the upkeep of existing house, around £10,000 on top. So £65,000 in total. She went into this home in late 2015 with our Dad (who died earlier this year). Before both fell ill (our Mum from a severe brain injury following a bike accident) they had cash savings of around £500,000 and a property worth £300,000. Several years of nursing home care for both parents have cut the savings pot to £180,000. The house remains.

There is some pressure within our family to look at moving her back home with a live-in carer to look after her at a cost of around £1,000 a week via an agency (similar cost to the HC-One home). When the £180k savings pot runs out one sibling says they are prepared to support the care costs as long as they are paid back by the sale of the house (though the sale of this may ultimately involve equity release). We are being encouraged by a friend of our Mother’s to look at annuity options and discuss the issue with equity release annuity specialists.

This is all new territory to all of us – especially the annuity side involving a very compromised person – and there are mixed feelings about moving Mother from a care home to her home. She would be reliant on one sole carer for much of the time with little distraction. Because of her brain injury she cannot read, write, reason logically, see reliably or listen to the radio/watch TV. She cannot stand or walk safely and battles constant fatigue. But she has a strong core self that is recognisable to friends and family.

Our mother hates the idea of someone taking care of her in her home but would have no option if she returned there. We all, I know, want to be in our own home. Though care homes get a bad press they provide a measure of community and (very) modest stimulation which our Mum would not get at home. Finding the right carer via an agency would be difficult. Our mother has very strong ideas about her diet also. We are struggling to know what to do for the best.

Any suggestions welcome.

Thanks

Keep_pedalling

It sounds like she still has the mental faculties to make her own decisions on this , so the best thing you can do is support her in this, and tell the others to take a running jump.

Do any of you have power of attorney in place? If not she should look at appointing attorneys she trusts to make the same decisions she would, not ones that seem to be aimed at retaining the family home. If a family member does want it to remain within the family, why don’t they just buy it from her?

AnotherJoe

I dont understand the issue here, whats the rationale to move her back home?

The costs are the same.
What does your mum want want to do?
As for supporting the costs, you can buy annuities that will do that, though they are expensive.
Is the one relative that says they will shell out the costs once the £180k has run out, prepared to do that for say 20 years if mum lives that long and the profit from a house sale is long irrelevant?? Not exactly the same but this may make them think again.

badmemory

Unless I have misunderstood she does not want a family member providing personal care. Therefore there it would not seem to be acceptable for her to be cared for at home.

Mr_Dufray

Thanks very much for the replies. Power of attorney is established, yes. Mum hates the 'fuss' of nursing homes and the relentless invasion of her privacy. But she doesn't grasp the intensity of her vulnerability. She can get herself to the care home bathroom en suite loo but cannot shower herself or run a bath. She is registered as partially sighted but has profound balance problems as a result of the TBI.

If she were to return home she would need to negotiate steep stairs (with the help of the agency carer) for the upstairs bath/shower tho' there is a downstairs loo next to a study. The study could be converted to a bedroom. Almost all her neighbours at home are elderly so limited support – nor would we want to rely on this.

Linton

If Mum is judged to be mentally competent I agree with the others that the best thing you can do is to accept that she has the right to make the decision and you should support her in implementing it. Would it be worthwhile/possible to ask social services to carry out a care needs assessment of what would be required for her to live safely in her own home? Perhaps modifications to the house and paid for home care would resolve the situation or if not she may be prepared to accept advice from an experienced and independent 3rd party on her options that she would not accept from her family.

JGB1955

Bear in mind that whilst she currently has 24 hour care, once she is at home, even with a live-in carer, that care will reduce to about 8 hours a day.

Mr_Dufray

Thanks for the replies. It would be 24-hour live-in care from an agency, very likely, with back-up to cover illness/holidays/time off.

hb2

24/7 care usually equates to at least 3 carers, that doesn't take account of carer sickness or holiday.

Malthusian

If Mum hates being in a nursing home and would hate being in her own home with live-in carers as well, then I struggle to see what moving her back into her own home achieves. Or how it is in her interests.

All it seems to achieve is to remove the extra care and stimulation she would receive in a nursing home.

If she moves back then her savings will last less than three years and then she will have two options. First is to sell the house and move again, either to a new house with live-in carers or back into a care home. Two moves in three years for someone in that position doesn't sound like a terrific idea to me. Most people would be stressed out by two moves in three years in the prime of their lives.

Alternatively she could take out equity release, which would allow her to pay her nursing fees for a few more years if it's a reasonably valuable house. But if that ran out she'd have to sell the house and pay back the loan and a large chunk of interest, and after that she could easily be in a precarious position.

I disagree with Keep Pedalling that she has mental capacity. "Because of her brain injury she cannot read, write, reason logically, see reliably or listen to the radio/watch TV." [emph added] That doesn't in itself amount to not having capacity but it's going down that road.

If she actually does have capacity then there's little stopping her from ringing a care agency and a taxi company and moving back herself. If she's unable to do that and the Attorneys will be primarily responsible for arranging the logistics then they need to consider her best interests.

The attorneys should see an Independent Financial Adviser (e.g. a member of SOLLA) to discuss whether an Immediate Needs Annuity would be appropriate. If her life expectancy is short the £180k in savings may cover it, but it depends on what the underwriters think.

The expectation would be that she would lose money by buying an annuity (that's how insurance works) but the decision needs to be made entirely with her own interests in mind.

Mr_Dufray

Malthusian: all rational and clear – thanks. Our mother cannot reason her situation reliably. There is a Deprivation of Liberty order in place. She took exceptional care of her nutrition and diet before her accident – a very clean life. The TBI has shattered much of her ability to live independently and safely. Much medication (anti-epilepsy, for example) is now taken.

It is difficult to diagnose the brain and there may be an element of dementia involved. The good care she took of her body means other areas, physically, are in good nick. So any medium-to-long-term underwriting diagnosis is very difficult. We may look at a SOLLA related IFA – thanks very much.