The longer we live the more likely we are to need long–term care later in life – and most of us are now likely to live longer than we would have in the past. While many of us have watched the older generation grow old and need long-term care, the inevitability of ageing is generally not something we like to think about in advance. The introduction of auto enrolment shows that most of us still need persuading to save for a pension. Evidence suggests that long-term care is even more remote in our thinking.
Long-term care will come with a cost for most of us, if we are lucky to live long enough to need it. In our sophisticated and advanced UK society, we seem largely to have lost a culture of expecting to provide care within the family across the generations. Very few of us would see it as an honour and natural obligation to look after the elderly within the family home – unlike many in less advanced and materialistically poor countries. This option for most families is a last resort rather than the first consideration. This means that each of us should individually prepare to finance our own future long-term care – because clearly no-one else is likely to and it appears the ‘welfare’ state increasingly can’t afford us later in life!
However all is not yet lost – there are some options for funding long-term care even if they are varied and can often be complicated. So if you or a loved one need to pay for care at home or in a care home, it’s important to know the facts. The cost depends on your health and mobility, what level of help and support you need and the value of your savings, assets and income. You could end up paying for all of it, some of it or nothing at all. People often have to make quick and difficult decisions about their own or a loved one’s care needs. Thinking about the options in advance will help in the long run.
There are three main options:
NHS Continuing Care: If you have a high level of care needs, say as a result of disability, accident or illness, you may be eligible for free Continuing Care, a package of healthcare that’s arranged and funded solely by the NHS and provided for you at home, or in a hospital, nursing home or hospice. You’re more likely to qualify if you have mostly healthcare needs rather than social care needs, relying on a qualified nurse, rather than a carer.
Local-authority funding for long-term care: Your local council may be able to assist you with the costs of residential care or help you stay in your own home by providing support for carers, equipment and specialist services. Exactly how much funding you receive will depend on your individual needs (based on a care-needs assessment) and how much you can afford to pay towards the costs of care yourself (based on a financial assessment). Your local authority or trust can arrange care services for you or you can opt to receive direct payments and organise things yourself.
Self-Funding: the biggest fear about funding your long-term care is likely to be that you’ll be forced to sell your home. Firstly, it’s important to claim any benefits you’re entitled to. Attendance Allowance and Disability Living Allowance (which is being replaced by Personal Independence Payment between April 2013 and October 2017) are the most common but there are many more you should be aware of.
Your self-funding options depend to a great extent on your circumstances. You may not qualify for funding from the NHS or your local authority. Even if you do, the amount you receive may not be enough to completely cover your care costs. If this happens, you’ll need to think about how you are going to top up any contributions, or pay for it all yourself. Whilst we might not like to think about it, long-term care is another area of finance where it pays to be prepared!