Why did Diana have to live on a pittance to pay for her sick husband’s care?
Her harrowing story exposes the flaws in the way our care system’s funded — leaving ordinary families to pick up crippling bills
IT WAS only near the end of their 50-year marriage that John and Diana Hodgkinson spent any significant time apart.
even when Parkinson’s disease stopped John getting up and down the stairs, Diana moved into the lounge of their home in Selston, Nottinghamshire.
But as former miner John’s condition worsened, it became too difficult to manage on their own and Diana made the heart-breaking decision to move him into a nursing home, where he died in 2008, aged 74.
‘He was the most loving man,’ says Diana, 73. ‘He was my pal.’
Moving John to a nursing home should have helped ease the strain on Diana. But instead, one of her lasting memories of the six years he spent there is the huge financial burden it put on her.
Though the council paid the bulk of the care home fees, the Hodgkinsons were still responsible for £700 a month that the local authority wouldn’t cover.
This money had to come out of John’s pensions, swallowing a huge chunk of the couple’s joint income. It meant Diana, who had given up work to care for her husband and says she wasn’t getting any state pension, barely managed to pay her heating and council tax bills and had to accept financial help from her five children.
She lived in fear that if John’s care bills jumped, the local authority would take their three-bedroom, semi-detached home.
Diana did ask the NHS to cover the £ 33,000 the couple spent on John’s care home fees.
She had a case under rules called Continuing Healthcare, which say the NHS should fund care for those suffering from degenerative illnesses such as Parkinson’s.
But like thousands of other families, she was rejected.
‘There just seems to be something wrong with a system where people who have worked hard all their lives have to go without to pay for care,’ says Diana. Welcome to Britain’s care crisis. Local authorities have so little cash to look after our ageing population they are trying to push through eyewatering council tax hikes.
Last week, Surrey County Council announced plans for a 15 pc rise. Liverpool and Lancashire are considering similar moves.
Today, Money Mail can also reveal that a lack of state funds has resulted in a giant £1.3 billion care home funding gap.
This is being plugged by families who pay their own care bills, who are being charged £8,000 more a year than they should be to cover the shortfall.
With so many families’ finances at risk, Money Mail will guide you through this national crisis.
CRISIS SPIRALLING OUT OF CONTROL
THE root of Britain’s care crisis is our ageing population.
Many of us are living far longer these days — but not necessarily in perfect health.
The number of people over 85 is forecast to double by 2030, according to figures from the Office for National Statistics.
And the numbers suffering from dementia, Parkinson’s and other ailments are rising at the same time, putting strain on the NHS and care providers.
Last week, the Office for Budget Responsibility warned the Government would need to boost the NHS’s budget by £88 billion over the next 50 years to cover the rising costs.
Under the current system, most people are forced to pay part or all of their own care bills.
When someone becomes ill enough to require care, the local authority sends someone to their home or hospital to check their finances.
The elderly person or a relative will be asked to submit details of savings, the value of their home and income such as pensions or rent from buy-to-let property.
If an elderly person’s assets are more than £23,250 in england and Northern Ireland — or £24,000 in Wales — they are entirely responsible for paying their own care costs.
As this figure includes the value of your home, you may have to sell up to pay the fees. There is an exception if a dependent, such as a spouse, is still living there. You can opt to defer the sale and pay any outstanding care bills after you die when the house is sold. In Scotland, elderly people with more than £26,250 must pay for the ir own accommodation. But personal care — for example, help with dressing or going to the toilet — is free and there is no charge if you need nursing help. In all regions, once your income and assets fall below these thresholds, the local authority should pay towards the cost of care.
And once your assets drop further — £14,250 in england — the local council must pay the fees in full. But even then, you could be obliged to pay for extra fees.
WHY YOU HAVE TO PICK UP THE TAB
TYPICALLY, local authorities set a maximum amount they’ll pay towards a care home place — and won’t cough up a penny more.
More and more care homes say this amount doesn’t reflect the true cost of looking after someone and so demand that residents pay extra.
Therefore, many families are asked for so- called top-up fees of up to £150 a week.
Through Continuing Healthcare, the NHS funds the care bills of patients who cannot live without medical help.
This should cover those who are paralysed or in the final stages of a deteriorating condition such as Alzheimer’s or Parkinson’s. But the criteria are notoriously hard to meet.
While it would be simpler if the state paid everyone’s care bills in full, local councils say there isn’t enough money to go around.
The Local Government Association estimates that councils need an extra £2.6 billion by 2020 to fund rising care costs.
One reason is that the Government has slashed the grants it pays to councils to provide these services.
For instance, in Surrey, the council’s annual grant has been cut by £170 million since 2010.
Local authority budgets are also stretched by other, less obvious pressures. In areas such as Birmingham, councils face bills of up to a £1 billion over a ruling on equal pay.
For years, workers in traditionally male- dominated jobs, such as bin men, were paid more than employees in jobs associated with women, such as nursing home workers — even when the roles were ranked at the same level by local authorities.
A court ruling in 2012 led to many councils having to issue backdated pay to female workers.
Councils are also being asked to pay more as the cost of care goes up. The £7.20-an-hour National Living Wage introduced last year has hit care providers, which have historically relied on low-paid care assistants and other staff.
Though the wage doesn’t sound overly generous, industry body Care
England estimates it could cause 9,000 homes, where profits are already stretched, to close by 2020.
Many care homes are trying to hike their fees in response.
TRICKS THEY USE TO MAKE YOU PAY
With councils unwilling — or unable — to cover higher fees, care homes are turning to families to pay out of their own pocket.
Figures shown to Money Mail reveal that people who fund their own care are being made to pay an extra £ 1.3 billion to cover the shortfall in the amount care homes are receiving from councils.
this means that in order to cover the cost of housing poorer residents, these families are having to find an extra £8,000 a year each.
William Laing, founder of healthcare analysts Laing-Buisson, which compiled the figures, says: ‘the entire care home sector is being kept afloat through care subsidies from the 40 pc of residents who pay privately.’
Mr Laing says councils contribute £486 a week on average towards a single care home place, even though the cost to the provider is £590.
this is where top-up fees come in. Around 56,000 families pay extra charges varying between £40 and £150 a week to make up the difference, according to charity Age UK.
Some homes are so desperate for cash they are making mistakes and charging top-up fees when they shouldn’t, according to the Local Government Ombudsman.
Families should not have to pay extra if there is no home in their area that offers care at the council’s maximum funding rate. in some cases, homes are flouting rules that say the extra fees must be formally agreed in a contract between the care home, the elderly person’s friend or relative, and the local council.
A care home can order a resident to leave a home if their family can’t pay these extra charges. But fears of bad publicity mean few carry out this threat.
instead they are hiring financial advisers to quiz residents and their families before they move in. they then reject those who look likely to struggle with charges. in the past, the Government has given local authorities permission to raise council tax by 2 pc to cover the rising cost of care.
Local authorities raked in an extra £382 million over the past year using the hikes. Under new rules, councils can this year increase charges by 5 pc, with 3 pc ring-fenced for social care.
But even that’s not enough. Councils that want larger hikes, such as Surrey, have to hold referendums to get voters’ permission. Some local authorities are trying to recoup costs with admin fees and crackdowns on families who hide assets. Northamptonshire County Council is planning to introduce a £50 fee to assess the care needs of those with assets of more than £23,250. Others have introduced £1,000 fees for arranging care for wealthier elderly people in their own homes.
WAYS TO KEEP COSTS DOWN
For many families, it’s galling to see a nest egg built up over a lifetime drained by care costs.
But experts warn that we may all be forced to put money aside to pay these bills.
Baroness ros Altmann, the former pensions minister, says workers need to be given a greater incentive to save, such as a care isa offering tax-free boosts if you use the money for care purposes.
She says the Government should also consider letting savers withdraw any amount of money tax-free from their pensions to cover care bills.
Currently, you can take 25 pc tax-free and the rest is treated as taxable income.
the tory peer says: ‘it is shameful that the Government has not offered any incentives for people to save for later-life care.
‘Many baby boomers have savings or large pensions, but have no idea they should be planning for care costs. Most think the Nhs will pay, but it won’t.’
there are a few, limited ways of cutting care bills.
One option is for generations to live together to support elderly relatives.
in 2013, the Government offered a 50 pc council tax break to build ‘granny flats’ and last year the number in existence rose by nearly 8 pc to 36,150, according to the Valuation Office Agency.
Another option is a so-called care annuity in which you hand a lump sum to an insurer, which pays care costs up to a set annual amount.
it costs around £232,000 up front to cover fees of around £30,000 a year.
however, it’s a gamble: if you die shortly after you enter the home, the insurance firm typically pockets the entire upfront sum you paid.
Future generations may find the amount they have to pay towards care capped.
Under reforms put forward by economist Sir Andrew Dilnot, a £72,000 limit was supposed to be introduced last year.
But these plans have been put on ice until at least 2020 because they were viewed by the Government as too costly to implement.
Crucially, the cap would apply only to the cost of care and not to your accommodation, meaning many families could still be forced to sell their properties.
A final option is to apply for Continuing healthcare. While an estimated 60,000 people receive this, hundreds of thousands more are believed to be eligible.
however, as Diana hodgkinson discovered when her husband John had Parkinson’s, it is incredibly difficult to claim — even when a case appears cut and dried.
this is because the decision about whether someone qualifies is subjective.
NHS figures show that the numbers qualifying for the payout are falling steadily.
Some families say they have been forced to wait years even for their applications to be considered.