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Feature

posted 12 Jul 2001 in Volume 6 Issue 5

Paying for nursing and residential care

NHFA Top Ten Tips

The need for nursing home or residential care often arises when least expected it could follow a period of hospitalisation a stroke or an incident at home as a result of gradual deterioration in the ability to be self sufficient. Whatever the reason most families have very little understanding of our long-term care system and need advice if they are to obtain and maintain the best possible care for their relatives.

The following are a number of tips that may be useful to families in this situation.

1. If the local authority is funding your care remember you do have the right to choose your care home. As long as the home has a place available can provide the care you are assessed as needing complies with the authorities set terms and conditions and does not cost any more than they would usually pay.
2. If you are self-funding claim attendance allowance. This is a non-means tested non-taxable DSS benefit paid weekly at the lower rate of £37.00 if you need care by day or night and the higher rate of £55.30 if you need care by day and night. (benefit rates from 1.04.2001) Saving up to £2 875.60 per annum
3. The local authority must disregard the value of your property for the first 12 weeks of residential care and assist with your fees if your other capital is below £18 500. If your other capital is below £16 000 you can also claim Income support whilst your property is on the market even beyond 12 weeks. Saving up to £82.70 per week
4. If the local authority is helping with care costs whilst your property is on the market you lose your Attendance Allowance if you are also claiming Income Support. You may therefore be better off not claiming income support if you are receiving higher rate Attendance Allowance and have pensions of over £100 per week.
5. Those residents who are paying for their accommodation from joint savings with a spouse at home should split those accounts into separate single accounts immediately to benefit from state assistance as early as possible i.e.

6. If your partner needs care consider changing the ownership of your property from joint tenancy to tenants in common. You can then Will your half to your children rather than it being caught up in your the means test for care should you predecease your partner. Saving 50% of the value of your home.
7. Draw up an enduring power of attorney. For the sake of spending £50 to £60 now you could save a lot of expense and complications if in the future you were unable to cope with your own affairs and had to involve the Court of Protection.
8. Be careful to choose a care home you are sure of being able to afford over the long term. If there is a danger that your money may run out make sure the social services will fund the care you have chosen and the care home will continue to accommodate you at what the local authority is prepared to pay. Otherwise you may find yourself having to move to cheaper accommodation or asking the family to top-up.
9. Did you know that most local authorities expect you to pay for home care as well as residential care if you have capital or savings of over £16 000. Consider purchasing long term care insurance to cover both these costs. The younger and healthier you are the cheaper the premiums.
10. If you have an immediate need for care and have sold your home to pay for care home fees consider purchasing an immediate need care fee payment plan. These deliver a regular guaranteed tax-free income higher than can normally be achieved from traditional investments or annuities therefore enabling care costs to be met for life whilst using up only part of your capital thus enabling you to leave an inheritance if you so wish. But be careful although there are only four companies that offer this product their actuarial view of life expectancy can be quite varied and consequently so can the product price.

For copies of the free NHFA Long Term Care Guide:
Call NHFA Care Advice Line 0800 99 88 33
Write to NHFA Freepost St Leonards House Mill Street Eynsham Oxford
OX29 4JX

Or visit www.nhfa.co.uk

Philip Spiers Nursing Homes Fees Agency