It is now nearly three years since our politicians were so all consumed in finding a solution to funding long-term care. This was in the run-up to the last general election. (See all my earlier blogs on this subject by clicking on “DILNOT COMMISSION” in the TAG CLOUD).
Of course, politicians’ promises soon disappear after elections and sure enough the standard prevarication tool of a commission to look into the issue was set up. The Dilnot Commission began its work in 2010 and reported its conclusions in July 2011 in its report which was called “Fairer Care Funding”.
Essentially they amounted to:-
- A £35,000 cap on residential care costs;
- Residents paying £10,000 per year for accommodation;
- State funding increased to those with up to £100,000 of assets – albeit tapered.
Andrew Dilnot’s laudable aim was to open up an insurance market to cover the first £35,000 cost of long-term care. This left the Government to fund, what the insurance industry would not cover. What the insurance industry calls the “catastrophic stop loss” – i.e. the costs when the £35,000 runs out.
This was a something for everyone solution that might just have worked, were it not for the new-found “time of austerity” and the rising numbers of elderly people with long-term conditions. The Government’s problem was the £2.3 billion price tag.
So wait another year and the prospect of another election begins to beckon. So the Government “modifies” the proposals:-
- A raised £75,000 cap on residential care costs;
- An uplift on accommodation costs to £12,500 per year;
- Some state funding for those with less than £125,000 assets.
Oh and by the way! ————- not implemented until 2017.
This is unlikely to open up an insurance market because the cost of cover will be too high. For most people they will still end up paying their own costs at around £100,000 for the first two years. What the revised proposal offers them is “stop-loss care insurance” beyond the first £75,000, which is a very small improvement on the current situation.
………… TO BE CONTINUED