Blair's Blueprint For Those In Care

There was little help for the 500,000 people living in residential care or nursing homes when the Government set out its plans for the National Health Service in England on July 27. A week earlier, the Chancellor had promised an extra £12.2 billion over four years for the health service. But when the details were set out, not much of that money was earmarked for people in care and nursing homes – around £360 million or less than 3% of the total. The plans described here apply to England. Different rules may be introduced by the Scottish Parliament and the Assemblies in Wales and Northern Ireland.

The changes will tinker with the means-test, pay for some of the costs of nursing care, and end an old funding regime that dates back to 1993. The Government offered little hope for people who are concerned that they may have to sell their home to pay for the costs of care – currently costing up to £400 a week in nursing homes in some parts of the country.

The Government plans came out as part of its long-awaited response to the Royal Commission on Long Term Care. The Commission was set up in December 1997 shortly after Labour came to power. And the cynics who thought this was a delaying tactic have been proved right – setting up the Commission, waiting for it to report (March 1999), responding to it (July 2000), and then implementing the changes (2001/02) will have taken nearly five years to address an urgent problem.

The Royal Commission proposed that the full cost of personal care in homes – not just nursing care – should be paid in full by the State. The other costs of being in a home, mainly food and lodging, would be paid by the resident – but there would be help for those with limited incomes. And it said that everyone should be allowed to keep up to £60,000 of their capital before it counted against them getting help with those costs. The Government rejected these proposals. Instead it plans four changes.

At the moment, people with capital – money in the bank, investments, or the value of empty property such as a house or flat – over £16,000 can get no help at all with their care home fees. If their capital is between £10,000 and £16,000 they can get help but are expected to contribute between £1 and £24 a week from their assets towards the fees.

The Government has said that these limits will both be raised "to restore their value to what it was in 1996". If that was done precisely it would mean the upper limit rising by just over £2000 to £18,200 and the lower limit would rise by £1300 to £11,300.

It is not a major change at all. Of course, it will be good news for the few people – possibly up to 5000 – whose capital is between £16,000 and the new upper limit who will begin to get some help for the first time. But for most of the 20,000 people who the Government says will be helped, it will mean a cut in the contribution to their fees of just £4 a week. And of course the increase only restores the limits to their real value when they were introduced in 1996. In other words, it is a one-off increase to allow for five years of inflation.

The Royal Commission called for a much more radical change in the capital limits – ignoring completely as much as £60,000. That would free many people of the need to sell their house or flat to pay for their care. And even those who did, would be able to keep a significant chunk of the proceeds – to use for their own needs or to pass on to their children.

The new limits will start in April 2001 and the exact amounts will be announced later this year. The Department of Health could not give Saga Magazine the cost of the change, but it will probably be around £60 million, most of that going to the 5000 people who will get some help with their fees for the first time.

The real fear of many people as they anticipate moving into a care home is that they will have to sell their own home to pay for their years in care. As I have pointed out in Saga Magazine many times, a house or flat only counts as capital at all if it is empty or if the people who still live in it are under 60 and not disabled (or a spouse of any age). But someone who goes into care and leaves behind an empty home is immediately assumed to have capital equal to the value of that house, flat, or bungalow. That will always be above £16,000 and so no help is given with the cost of the nursing or care home fees. The Royal Commission criticised this immediate penalty. After all, it can take up to six months to sell a home and realise the money. The Government has decided that from April 2001, the value of an empty home will be ignored for three months. After that, its capital value will count, and that will usually mean the end of help with the care home fees. The concession will help around 30,000 people and cost about £65 million a year

And there is another change promised by the Government to try to remove the fear of having to sell your own home to pay for care. As I have pointed out in Saga Magazine many times, the local council cannot force anyone to sell their home. All it can do is send them a bill each week for the fees in the care home. And then when they finally die, the home is sold and the bill is paid. The Government says it will give councils a grant to help them extend these schemes and make them more consistent throughout the country. It may also introduce loans to meet care costs to "reassure people that they will not be forced into selling their homes during their lifetime to meet the costs of their care". It is not at all clear how either of these changes will actually work or why they are needed.

One of the big complaints about the cost of nursing home fees, is that people in homes have to pay for their nursing care whereas people in National Health Service hospitals do not. In the 1980s and 1990s, many older people were moved out of hospitals, where care was free, and into homes where they had to pay in order to save money for the cash-strapped National Health Service. The Government has decided that in future the nursing costs should be paid for by the National Health Service in nursing homes as they are in hospitals. Exactly how this will work when it is introduced in October next year, is not clear. But the Department of Health told Saga Magazine that it would be done on an individual basis. So someone who needed the most nursing care would have lower fees than someone in the same home who had fewer needs for nursing care. If this change is to be introduced in October 2001, it will mean assessing the detailed needs of more than 200,000 people already in nursing homes to see how much their fees can be reduced. That is a major task. And it is very hard to say what exactly ‘nursing care’ is and what is ‘personal care’ which the Government says will NOT be paid. For example, if someone is incontinent is washing and dressing them and changing their bed daily, nursing care or personal care? The change – which will cost more than £200 million - will ONLY apply to nursing homes NOT to residential care homes. The Government says it will benefit 35,000 people.

People who have been in a residential home since before April 1993 have their costs met in a different way, mainly through income support rather being paid by the local council. The Government has decided to scrap this old scheme and move the 40,000 older people onto the same scheme as everyone else. It promises that people should NOT have to change homes, although that might happen in a few cases.

Many people would prefer to stay in their own home and be given some care there rather than move into a residential care or nursing home at all. But there are at least five different ways that care costs are charged for. The Government has said that it will introduce a standard national charging scheme for all local authorities in England. It is likely this change will raise charges in some areas and cut them in others when it is introduced next year. But the Government has promised a lot of new money – £1.4 billion by 2004 – to help people remain at home rather than go into residential care.

Although the Government has not made the radical improvements many were hoping for in paying for long-term care, the extra money for the National Health Service in general will benefit older people substantially. Over five years the Government has promised 7000 extra hospital beds, 9500 more doctors, 20,000 more nurses, and 6500 other health professionals. It also promises quicker appointments and more rapid treatment. Older people are major users of the National Health Service and, if these improvements really happen, then they will benefit from them more than any other age group.

· Capital limit above which NO help is given with fees raised from £16,000 to more than £18,000

· Capital which is completely ignored raised from £10,000 to approximately £11,000

· Value of empty home ignored for up to three months (currently counted at once)

· Cost of nursing care in nursing homes paid for by National Health Service NOT by residents

· 65,000 people (40,000 of them over 60) who have been in a home since before April 1993 will move to new funding arrangements

September 2000

e-mail Paul Lewis on paul@paullewis.co.uk