Both my parents are in long-term care. Most of their assets are owned by my father so only he has to contribute to the cost of his care. While my mother is by no means fit and healthy, she could nonetheless live for many more years. My father, however, is in very poor health and suffers from Alzheimer's disease. Under his will, all his assets will pass to my mother on his death, which will result in them being means-tested by the local authority and used to pay for my mother's care and, hence, be lost over time. Can we prevent this?
In England, where an individual is in local authority care, they are expected to pay towards the cost of their non-nursing care out of their own capital and income until they have less than £12,000 capital left, at which point the local authority will pay for the shortfall between the cost of care and the available income.
I would first question whether your father should. in fact, be paying for his care, despite his assets being over this threshold. A recent ruling by the Health Service Ombudsman upheld a complaint about a patient with Alzheimer's disease who was denied NHS-funded nursing care. This has opened the door to many people and families in similar situations to seek recovery of fees paid and this is definitely worth exploring.
As your father is not of sound mind, he is not in a position to change his will. As things stand, your mother will inherit his estate and the capital will be used to fund her care.
You and your solicitor could be excused for thinking that an effective strategy would be for your mother to disclaim her entitlement under your father's will on his death or effect a deed of variation to change the beneficiary to you or someone else. All affected beneficiaries under the will must agree to such an amendment and it must be executed within two years of the death. The changes are attributable to the deceased, effective from the date of death and can be beneficial for capital gains tax and inheritance tax purposes.
However, strictly speaking, the person deemed to making a settlement by a deed of variation is not the deceased, it is the person who was entitled to the assets in the first place. Therefore, the local authority will look on such an arrangement as your mother deliberately depriving herself of assets and, as such, will call on you to pay her fees.
While a disclaimer has a retrospective effect, applying from the date that the entitlement arose, with the person disclaiming the inheritance not legally being a settlor, the local authority is again unlikely to accept such an action as anything other than deliberate deprivation of assets. While this could be challenged by you on behalf of your mother, the process is extremely long and tedious and you are unlikely to be successful.
But all is not lost. While your father is not in a position to amend his will, there is still a way in which this can be done. Jurisdiction is given to the Court of Protection enabling a statutory will to be executed on behalf of a person lacking testamentary capacity. Provided it is established that the individual lacks one or more of the essentials of testamentary capacity (the capacity to understand the nature of the document being executed, the extent of the property to be disposed of and the claims of those to be benefited by or excluded from the will), those with an interest are able to ask the court to consider the patient's presumed wishes before their death and authorise a new will if appropriate.
Obviously, if your father had the legal capacity to make a new will, there is little doubt that he would do so, removing your mother as a beneficiary of his estate. The interests of your mother and anyone else who might benefit from the estate would need to be considered. However, provided all potential beneficiaries are in agreement, the court should agree with the course of action.
On your father's death, the local authority will request a copy of his will to establish the extent of your mother's interest, as she will not be included in the will. There will, in my opinion, be no basis for them to raise a challenge that there has been a deliberate deprivation of assets.