Let’s talk about long term care

If a care need arises, understanding the complex rules and processes of the UK's care systems can be challenging, often overwhelming both those needing care and their carers. It’s a situation that has been described as a ‘drunken walk,’ with many people in need of care or their family members staggering from one source of misinformation to the next, often resulting in financial as well as emotional and psychological harm.

Statistics show that 1.4 million older people do not have access to the care and support they need, and between 2007 and 2032, the number of people aged 65 and over who require unpaid care is projected to have grown by more than one million. So, providing support for unpaid carers, as well as the equipment and facilities for older disabled people, has never been more important.

The important role of unpaid carers

Currently the care systems across the UK are propped up by unpaid carers who, more often than not, are family members. There are currently over 13 million unpaid carers in the UK, many of whom are juggling work with caring. When you combine the scale of this, with the inadequate state and local authority funding and provision, this is causing significant problems in terms of burn out and mental health issues, as well as sector specific issues such as ‘care vs career’.

Research suggests that 1 in 4 of us will need care at some point in our lives. What’s more, according to Carers UK, the average person has a 50% chance of caring for an older adult by age 50, and they currently battle their way through a barrage of services, systems, agencies, tests and charging regimes that seem designed to deter demand until needs become extreme. Approximately 600 people per day resign from work because of a lack of support in juggling the balance of work and care.

Those in need of care and their family members typically are having to navigate the plethora of ever complex rules and processes across the UK care systems, at a time when most are trying to address urgent needs, have no prior experience of doing so and are often in a state of stress and anxiety.

Recent commentary from a range of significant organisations, including the House of Lords Adult Social Care Committee, the ABI and ADASS, has identified a growing public need for access to timely and accurate information, advice and support, enabling them to make well-informed choices about their future care related needs.

Basic steps to navigate the care system

It’s so important that those in need of care and their families or legal attorneys have easy access to the information they need, at the right time, presented in a clear and simple way that can be easily understood, and that’s why we’re launching My Care Hub - the UK’s first ‘one-stop-shop’ for care advice, to provide the answers to the important questions that arise when someone needs care. You can read more about My Care Hub and find out how to access this valuable resource at the end of this article.

The 5 key steps you should take:

1.Understand what the care needs are and what services are available locally to meet them (and the cost)

2. Understand what services may be available from a local authority or the NHS

3. Make sure you are in receipt of any state benefits to which you are entitled

4. If your needs are for social care, and at a level the local authority deem eligible, the next step is to determine who pays

5. Understand the 9 available ways to pay for care for those who are self-funding, and consider taking financial advice

Furthermore, it’s important that necessary arrangements are made such as updating a Will, and establishing Lasting Power of Attorney, so appropriate legal advice may also be needed.

When it comes to those who are self-funding their care, the following considerations will typically be front of mind:

• How much will my care cost, now and in the future?
• What happens if my money runs out?
• What are the different ways to pay for care, and how can I guarantee these payments for life?

Are you or a loved one having to pay for care and need answers to these and other questions?

If yes, then you aren’t alone.

The Care Act 2014 which came into force with effect from April 2015 provides the legal framework for how Local Authorities identify, meet and contribute towards the care needs and costs of adult social care. Having established eligible care needs, it sets out the criteria for the financial assessment (also known as the ‘means test’) to establish if an individual with care needs should contribute towards the cost of their care, and whether the local authority will pay for all or some of their care costs. Broadly, if you have more than £23,250 (England) in assessable capital/savings and are not eligible for (free) NHS Continuing Healthcare, you will be responsible for funding the full cost of your care.

If you are self-paying, the first thing to be aware of is that there are several ways that care fees can be paid and the best way to pay for your care will depend upon your specific circumstances. Your best option might involve a combination of solutions, and with careful planning it may be possible to use whatever assets, savings and income you have in such a way that care fees can be paid indefinitely for as long as needed, whilst still protecting some of your savings, perhaps to pass on to beneficiaries. The next thing to understand is that the earlier you address the issue of paying for your care the better. The best options typically require careful planning, but unfortunately, it’s very common to find that people only seek help when they are starting to run out of money, at which point their options are often limited.

Who has to pay for care depends on individual circumstances. You might be responsible for paying for some or all of your own care. This means you’re known as a ‘self-funder’. It’s possible that the NHS or your Local Authority will pay, or will make a contribution towards your care costs. However, when it comes to social care, in general if you are able to pay for it, you’ll be expected to do so.

The 9 ways to pay for care

There are broadly nine available ways to pay for care, and the best option for any given individual could involve any one, or combination of, the following solutions:

Using your home as an asset

1. A Local Authority Deferred Payment Scheme – this is a form of loan available from a local authority to pay for care to those who satisfy certain criteria. It is designed to provide time and breathing space to enable a property to be sold, if the property doesn’t qualify for a property disregard.

2. Rental income from your home

3. Equity released from your home

4. Funds released through the sale of your home/downsizing without using your home as an asset

Using other non-property assets

5. Liquid assets/cash/income

6. Investments/portfolios

7. Pension funds

8. Long Term Care Insurance Product (LTCI) – this is an insurance policy that guarantees the payment of care fees, for life. This is currently the only available way to protect against something called ‘longevity risk’ – the risk of running out of money completely due to paying care fees.

9. Third Party Top-up – this is a payment from a third party (i.e. family members, friends or in some cases, charities) to pay for more extensive care than a local authority can provide.

Financial advice can make a real difference

Whatever method of funding care fees is used, it’s likely that there will be inflation-linked care fee increases in the future. It’s also essential to keep in mind that you may require a higher level of care if your condition worsens, which of course would mean higher fees. For example, if you are receiving care at home, there is the potential for needing additional hours to meet changing needs, or even the requirement to move into a nursing home at some point.

When it comes to seeking help, most people don’t realise that only specific financial advisers, regulated by the Financial Conduct Authority and who have achieved a certain level of qualification (including a recognised, specialist exam in long-term care) are authorised to advise on all the possible ways of paying for care. This includes a little-known solution that pays care fees at a chosen level for life in exchange for a one-off lump sum payment. The Society of Later Life Advisers (SOLLA) helps people and their families in finding trusted accredited financial advisers who understand financial needs in later life, and the plans you need to make for your retirement years. If you are paying for care and don’t already have a suitably qualified financial adviser, SOLLA can help: Society of Later Life Advisers - SOLLA.

Looking for more information?

My Care Hub – is the online ‘one-stop-shop’ for care advice.

Our recent innovation, My Care Hub, is designed to support individuals throughout their entire care journey. It provides essential guidance from the moment they anticipate becoming a carer, helps with planning when a care need arises, and continues through to end-of-life care. The Hub also offers qualified signposting to related professional services and access to 1:1 email and telephone support from expert care advisers at My Care Consultant. We’re delighted to be partnering with Autumna to make their valuable care sourcing services available to all users of My Care Hub.

The need for care is something that will affect us all at some point in our lives, whether caring for another, or needing care ourselves. The complexity of the care system is a problem that’s reached the highest levels of recognition across the UK, and the creation of My Care Hub is our commitment to delivering a much-needed resolution.

This invaluable new tool is applicable no matter where you are based in the UK and will be available to members of the public later this year.

About MCC

My Care Consultant (MCC) helps those in need of care, their family or legal representatives navigate the complex social and health care systems that operate across the UK. They help people to better understand the importance and value of financial, legal and property management advice as well as how they can gain access to it. In so doing, MCC seeks to establish a clear pathway, a joined-up approach and to be an independent ‘first port of call’ in meeting the often complicated and frequently urgent needs that many older people and their families have.