What the cap on care costs doesn't do

Elderly hand holding coins Ministers want to cap the costs of social care, but there are some caveats

Ministers are hailing their changes to social care as the solution to the long-standing problem of how to care for the elderly.

The introduction of a £75,000 cap - if introduced - will arguably be the first time the system has been overhauled since it was created along with the NHS after the Second World War.

Understandably, the plans have been widely welcomed with campaigners willing to give the government credit for doing this at a time when the financial situation makes it harder to do than it has been for a long-time.

But despite the breakthrough it is not quite the panacea it may seem on first glance.

Many people will still not get any help from the state

The government is effectively saying it wants to see a partnership between the state and individual.

It is promising to pick up the really high costs, while leaving the individual to cover the cost of the average care package.

But less than a fifth of people face costs in excess of £75,000, meaning the majority of people will still have to pay all of their bill.

About a quarter of people do not develop any care needs - or very little, while for another quarter the costs of care are below £20,000.

However, for a third of people the bill is between £20,000 and £75,000 - they will not get any help unless they fall below the means-testing threshold as the least well-off do not have to pay the full costs of care.

But of course many will say that is better than the current situation where people can face unlimited costs - and the hope is that the insurance industry will develop products that will cover the costs people face.

You won't be able to shop around for the best services

The cap only includes services that are available at the normal council cost.

If you want to move into a luxury care home or pay to get the best help you will have to cover that extra cost yourself.

Any spending above what the local council would have paid for would not count towards the cap, leaving the individual to top up their package.

It means relying on the current quality of services available if you want to stay within that £75,000 sum.

Unfortunately the system, according to the Local Government Association, is drastically under-funded, which is hampering the ability to meet the needs of the elderly.

The government spends less than £10bn a year on social care for the elderly - a tenth of what is spent on the NHS and a quarter of the defence budget.

The criteria for being entitled to social care help will be extremely high

Just because you develop a care need, it does not mean you will fall within the system.

Only those with needs classed as severe or substantial will be entitled to help - that basically means you need round-the-clock help.

Any spending before you reach that level of need will not count towards the £75,000 cap.

It will mean many will still have to struggle to get by on their own until their situation worsens.

That is no different to how it is now, although a decade ago many councils were able to offer help to those with low or moderate needs.

The social care system, in a nutshell, will only be there for the most frail.

Care homes will still be expensive places

A cap of £75,000 is a substantial sum of money, but on top of that people face paying so-called accommodation costs.

This is to cover the cost of things such as food, bills and renting the room.

Of course, these are the kind of costs elderly people face if they are in their own home - and that is one of the reasons why there is a state pension.

But with annual "accommodation" bills often hitting the £10,000 mark, a care home place will be a more expensive arrangement than the status quo for most.

Nick Triggle Article written by Nick Triggle Nick Triggle Health correspondent

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  • rate this

    Comment number 129.

    The real devil in the detail of this is that people won't even qualify for the cap unless they have major needs, i.e. round-the-clock care. As with disabled people now, it will be easy to ratchet up the qualifying severity level whenever the Govt wants to pinch more pennies. Old people will actually be put in the position of hoping their health gets a lot worse.

  • rate this

    Comment number 128.

    Another sticking plaster and spin. Where is the assurance given when the Health Service was formed that NI contributions would look after us from "the cradle to the grave" ? Governents saw the demographic time bomb emerging with the "baby boomers" and made no provision. Why not simply put up Nat Ins contributions to cover the costs for everyone. we ALL pay for schools but not everyone uses them.

  • rate this

    Comment number 127.

    120.AlErgic:"While us old ones paid for WW 2 debts, while our parents fought for you lot. While we had interest rates and inflation that your generation has never seen."
    Are you actually taking on the war hero mantle of your parents' generation by inheritance? I knew my grandparents well (and incidentally grew up through the inflation etc), and they'd have had a few things to say about that!

  • rate this

    Comment number 126.

    My husband and I have always been savers, but as he turns 60 this year we have decided to become spenders. Why the heck should we continue to increase our assets for our old age when we will just pay for the 'cradle to grave' care I thought national insurance and taxes entitled us to? Seems you're better to have nothing and then grab what you can when you need it rahter than be prudent

  • rate this

    Comment number 125.

    Incentives in our society are perverse. Work is not encouraged and its easier to scrounge. My wife has incurable lung cancer. I could abuse this fact, jack my job in and scrounge to the tune of £800 per week on benefits and have my elderly costs just paid whilst I watch Jeremy Kyle everyday. £800 is more than I earn!! My dignity stops me from doing so. A lot of folks don't have dignity.

  • rate this

    Comment number 124.

    Work hard people. Save all you can so they can take it from you.

    Alternatively do nothing and they will provide.

  • rate this

    Comment number 123.

    At least the problem is now being faced instead of being ignored. It should come in sooner and there should be a plan to get the cap down to half that level over the next parliament and eventually Zero. Costs could be met by getting rid of free bus passes, winter fuel payments and television licences to those that don't really need them. Care is like the NHS, if you need it, you need it.

  • rate this

    Comment number 122.

    120.AlErgic:"While us old ones paid for WW 2 debts, while our parents fought for you lot. While we had interest rates and inflation that your generation has never seen. Come on no working man in history has ever had a fair chance."
    What a curious way of looking at your life of free healthcare, education, property speculation and easy job prospects. Should we thank you for spending the lot?

  • rate this

    Comment number 121.

    Remember the limit is £75k divided by the standard government social cost of £350/week which gives a 215 weeks ie 4 year period.Most homes charge around £500/week for this plus the £200/week 'hotel costs'. Therefore over the 4 years you will spend some £144k before the cap fits. Twice this if both wife and husband require a home. So you still lose your house before the cap fits.

  • rate this

    Comment number 120.

    117. This Is England
    While us old ones paid for WW 2 debts, while our parents fought for you lot. While we had interest rates and inflation that your generation has never seen. Come on no working man in history has ever had a fair chance.

  • rate this

    Comment number 119.

    It would appear that the idle & feckless will not have to contribute anything .. this should appeal to labour. The rich will only contribute a small proportion of their wealth which should appeal to the conservatives ..leaving the prudent working majority again taken for granted by Government

  • rate this

    Comment number 118.

    The money this goverment wastes on things like overseas aid, immigration, and the E.U. budget could help pay for care for the people who need it. Don't forget alot of these people fought in the war to keep this country free, todays politicians need to remember that, they may not have been here if it was not for the older generation.

  • rate this

    Comment number 117.

    The irony in all this is that the generation either currently or soon to become pensioners are the very same who voted for this. After all the privileges they have garnered as the Baby Boomers, they still aren't happy with their lot. Meanwhile, us young'uns are paying for your pensions now whilst you transfer your debts onto us, destroying our own chances of a comfortable old age. Cheers.

  • rate this

    Comment number 116.

    why all the effort to protect inheritence? It seems on the issue of social care the younger generations (of which I am a member) want to have their cake and eat it.

    If you want a whopping inheritence, I have a solution. Look after your own relatives!

  • rate this

    Comment number 115.

    I'm delighted that the elderly will have the drain on the financial resources capped and will be able to hang on to their entire wealth (minus the £75K) while the top-up is provided by the rest of us.

    Anyone know what happens when the government spends all of the money it receives in tax revenues and can no longer borrow?

    Pass the parcel, kick the can down the road - last one out is destitute.

  • rate this

    Comment number 114.

    Another way of getting your money, this government is hell bent on getting money out of pensioners any way they can, for the average pensioner it will still mean the selling of your house,if you own one, to pay for your care,if your not a millionaire by the time your 50 , dont bother saving ,spend all you've got and then let the state look after you, because they'll take what you've got somehow.

  • rate this

    Comment number 113.

    'National Insurance' was the biggest example of political spin ever. With car insurance I pay the premium and if I have a crash it pays out. With NI, having paid in all my working life, when I need it the excess is so big it will never pay out. Unlike realinsurance, those with the biggest risks pay least and those with the lowest risks pay most.

  • rate this

    Comment number 112.

    Come on Government, we pay tax all our working lives, we pay insurances all our working lives. Now you want to keep us in our place at the lower end of the scale by depriving us of any savings made. Not a very good vote winner. The election isn't that far away. Distusted from the South West.

  • rate this

    Comment number 111.

    Since the cap will not cover "hotel costs" the new system will be complicated. At the moment councils take over costs when savings fall below £23,500 and then charge you a contribution. Will that limit still apply for the accommodation costs and the higher limit apply only to care? Who will decided which is which? On my mother's contract there is no mention of care v accommodation charges.

  • rate this

    Comment number 110.

    Glad people are seeing through this. Jeremy Hunt is the 'go-to-guy' when a deceitful thread spinning.
    The average person still loses their assets regardless of how much they've paid in. That's obvious, notwithstanding attempts to cloud the fact.
    Govt is desperate for your money. It has a hocus-pocus financial collapse to support until 2015, when it can blame someone else.
    Like the last lot did.


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