People depleting wealth to avoid care fees costing councils £1.58 billion
Published by Max Salsbury for 24dash.com in Care and Support and also in Finance, Local Government
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The proportion of people who would be happy to reduce their assets in order to ensure the state pays for the majority of their long-term care has almost doubled over the last year.
With an estimated 150,000 entering care each year, insurer Partnership believes that people deliberately squandering their funds to avoid care fees could see councils hit with an additional £1.58 billion burden in England alone, if all of those who say they intend to spend their wealth do so.
In 2013, 23% of people surveyed said they would happily spend their way below the £23,250 threshold to avoid care costs, while a survey conducted this year found that 41% intended to do so.
According to Partnership, councils in the South East (£330 million) and North West (£240m) are likely to be most impacted due to the relatively high number of care homes in those regions.
However, people in the East Midlands (53%) are most likely to say they would spend their wealth and fall back on the state for support.
Thomas Kenny, head of technical pricing at Partnership, said: “Despite the introduction of a proportion of the Care Act in April 2015, 61% of over-45s are still confused about how the care system works, who funds it and how much it costs.
"With some viewing long-term care as a service that the state should pay for, you can see why they might think that they would rather spend their assets or give it to their families to avoid paying these bills.
“However, reality is often very different from theory! Not only do 77% want the opportunity to live near their families if they go into care – not always an option for those the council funds – but 44% say they have not even thought about care so this type of forward planning is unlikely.
"However, when the new legislation comes into force, this is something that councils will certainly need to watch for."