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What choice for care?

Health Secretary Andy Burnham has unveiled the Government’s Green Paper for adult social care and called for a dignified debate into the fate of Britain’s elderly.

For such a long awaited document, it could have been a damp squib but instead it contained some fresh thoughts and ideas about how to fund the increasing black hole that is Britain’s future care bill for the elderly.

Three proposals were put forward – a partnership approach where the cost of care is split between the Government and the individual, a voluntary insurance scheme where the cost of care would be split between the Government and individual insurance and a comprehensive approach, where individuals would pay into a mandatory state insurance scheme which would then cover the costs of all long-term care.

There are pros and cons for each when scrutinised.

We agree that the current system is unfair. We have worked with countless families who have gone through the trauma of dismantling the lives of elderly loved ones, eroding property and family treasures and watching hard-earned money disappear.

Most of the people currently in care homes had high hopes 60 years ago when in 1948 the bright and shiny National Health Service was born.

Can Andy Burnham create a phoenix from the ashes of the current care system? Can the proposed National Care Service really provide a level playing field for everyone or will they realise there just is not the money to keep the goals open at both ends?

The Big Care Debate, a consultation with the public and the care industry, sounds exciting. The thought of real people shaping the future may be seen as refreshing and pioneering by some.

One potential negative issue is the timing of the proposals. Although the consultation period will finish in November, the White Paper is not going to materialise until next year, but when next year? There has to be a general election before the end of May. It is extremely likely that the Government will campaign on the results from the Big Care Debate and try to make the views of the electorate difficult for the opposition parties to dismiss.

Turning our attention to the three proposals set down by Burnham, there are gaping flaws in each route.

None of these solutions removes any kind of lottery. Property prices will always be one step ahead on this one. Unpopular means-testing will be scrapped but will be replaced by stealth, incorporating a different tier system dictated by the cost of the chosen care provider.

What remains to be seen in the long term is whether or not Andy Burnham is the new Nye Bevan. Will he really go down in the history books as the guy who changed the lives of our elderly and vulnerable citizens or will he be remembered as a pawn in an elaborate chess game played by an increasingly weak and dying Government?

If Labour retains power next year, the new legislation will not be phased in until 2014. This means an awfully long wait for the people either in care now or those 400,000 who will face the need for care sometime before 2014. Sadly, many won’t see the promised land date arrive.

One thing is certain. For people paying their own care bills, the need for the highest- quality specialist financial advice has never been greater.

This, in turn, creates an opportunity for the IFA community to expand its own revenue stream with a market place that is as bombproof as it gets in a recession. But will it rise to the challenge?

Care fee planning is deemed unpalatable by many advisers – and for some comprehensive and understandable reasons. However, for those with integrity and a willingness to make a difference, the door is wide open.

The three options in the Green Paper

Comprehensive

Reverting to the objectives of a cradle-to-grave healthcare system is probably the least workable of all the proposals. It sounds great in principle but the draft clearly says “everyone who can afford it”. Who will decide this key point?

So, at what fee level will the state pay? Care costs can vary enormously, even within the same postcode.

Whether the national limit is set at £650 or £1,200 a week will remain to be seen but our instincts tells us it will be at the lower end.

Insurance

This is a good idea in principle but which companies will offer the products and how will they be made available? Although pre-funded insurance plans were previously available, the take-up rate was woefully poor.

It is vital that any product provider learns lessons from the past and makes future care plans both affordable and with realistic claim criteria.

Partnership

There are merits in this idea. But the proposals state that the Government would fund between a third and a quarter of a person’s care bill.

But which bill? For example, two identical people may both need care. One opts for care costing £650 whilst the other selects a care home with fees of £1,200. Surely the percentage paid has to be capped at the national average? Otherwise care home fees will rocket once again leaving those with low incomes without any real choice.

It is highly likely, that the contributions made by the Government (at whatever percentage) will simply replace two existing non- means-tested benefits – attendance allowance and nursing care allowance.

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