Adult social care green paper

The Department of Health published its long-awaited green paper on the future funding of adult social care on 14 July, 2009.

At its heart is a proposal to establish a national care service, providing all people with needs above a single England-wide threshold with access to some public funding for their care in older age.

The current funding situation

The government said that currently people aged over 65 could will need care and support costing £30,000 during their lifetimes with 5% having needs costing £100,000 or more (excluding the cost of accommodation). It pointed out that for those with savings of £23,000 or above there is no help from the state with these costs.

The proposal

It is proposing to give all people with a care need above a particular threshold at least some public funding for care: a minimum of a quarter to a third of the cost, rising to full support for those on the lowest incomes.

It has then put forward three options for how people might fund care costs not met by the state:-

• A partnership model under which individuals are left to meet their care liability themselves. While average costs for people over 65 would be around £20,000 to £22,000, those with the highest needs, such as those with Alzheimer's, could still face significant costs of £100,000 or above.
• An insurance model under which people would be invited to enrol in a state-backed insurance scheme - either run by the state or private insurers - and then get all of their care costs covered. The DH estimated that people might need to pay £20,000 to £25,000 into the scheme, protecting those with higher needs against prohibitive costs.
• A comprehensive model under which all people over 65 would be compulsorily enrolled in a state insurance scheme. This would reduce premiums to £17,000 to £20,000, but people would need to pay regardless of whether they needed care or not.

Accommodation costs

Accommodation costs in care homes would not be covered by this arrangement, but these would still be covered for those with the least means, as now.

However, the government is proposing to set up a universal deferred payment scheme, allowing homeowners to have their board and lodging costs met and then recovered on the sale of their properties. This would end the current situation where deferred payments are discretionary, with arrangements differing between councils.

National consistency

The green paper also proposed a radical shift to a more nationally consistent care system:

• There would be a single national eligibility threshold, under which people who had difficulty with three or more activities of daily living would be covered. People would be able to move between areas and take their eligibility for care services with them, unless their needs also changed. This would end the system of councils setting their own eligibility criteria in accordance with the Fair Access to Care Services guidance and people having to be reassessed when they moved areas.
• The government would decide what proportion of someone's care costs would be met by the state and what by the individual, rather than allowing councils to determine charges for non-residential services, as they do now.

However, it has also asked whether it should go further in removing responsibilities from councils by specifying how much money people should receive for a given level of need, rather than leaving this to councils' discretion.

This would mean that people living in different areas would receive the same level of financial support if they had equivalent needs.

However, it would not take account of the different costs of care in different areas - for instance due to the higher costs of salaries in London - meaning that people living in higher-cost areas may be able to purchase less care than those in lower-cost areas.

Timetable

The consultation on the green paper - what the government is dubbing The Big Care Debate - will run until 13 November 2009.

The green paper is due to be followed by a white paper in 2010 but the government does not envisage implementing the plans until 2014, well into the next Parliament, and potentially under a Conservative government.

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Background

In 1999 the Royal Commission on Long Term Care for the Elderly recommended that the state pay for all long-term personal care. That idea was rejected by the UK government, though a policy of free personal care was then adopted by the devolved administration in  Scotland and introduced in 2002.

In England and Wales, state-funded personal care remained means-tested, along with, as in Scotland, hotel costs in residential care.

However, a few years later the debate on what the state should - and should not provide - reopened, driven by the prospect of increasing numbers of older and disabled people and rising expectations of services; tightening eligibility criteria for care, excluding many needy people from support; the impact of charges and means-testing on access to care for those with moderate levels of wealth; and a widespread sense of unfairness about the "postcode lottery" for services.

Wanless report

In 2006, Sir Derek Wanless's King's Fund-commissioned report, Securing Good Care for Older People, set out no fewer than six funding options for social care including new and improved means-testing; free personal care of the kind already adopted in Scotland, and social insurance based on entitlements. Wanless (right) expressed a preference, however, for a "partnership model", which would give a basic, minimum level of care to everybody, put an end to means-testing, and allow people to finance more sophisticated care packages by matching funding up to an agreed amount from the government.

It was not until October 2007 that the government committed to long-term reform and promised a green paper on the future of care and support.

Making its case for fundamental reform of social care funding in May 2008, the government did not mince its words. In 20 years' time it predicted a £6bn public funding shortfall if resource increases kept pace with economic growth, driven by rising levels of need and expectation.

Not sustainable

"The existing care and support system is not sustainable because of the massive challenge that changing demographics represent for our society," the government said in its Care, Support, Independence consultation document, published in May 2008.

This was amid evidence that tens of thousands of older and disabled people were already not receiving the services they need.

According to the Commission for Social Care Inspection's  State of social care 2006-7 report, published in January 2008, increasing numbers of people were being excluded from council-funded services and were facing poor outcomes as a result.

Stimulate debate

In the six months to November 2008, the DH held an "engagement process" to raise public awareness of the impact of demographic pressures and rising expectations on the future costs of care.

The six-month "engagement process"  was intended to stimulate debate about the need for a better funding settlement for social care and how this might be paid for.

The government held nine events for stakeholders and five for citizens around the country to raise awareness of the issues facing the care system. It also commissioned the London School of Economics to model different funding scenarios and conducted an opinion poll on public attitudes and awareness of the care system.

The latter found high  levels of ignorance among the public, with almost one-third of adults polled believing care would be free for them in future, despite widespread means-testing and high eligibility thresholds.

As the engagement process drew to a close, a number of organisations put forward their proposals for change, to inform the green paper, and have their say on a number of key questions raised by the government for the future of care and support.

National prescription or local flexibility

Strong support has come out for a move away from councils determining care eligibility - and, in the case of domiciliary care, charges - towards a national system, ending the postcode lottery.

Department of Health director general of social care David Behan said the idea had received strong support during the engagement process. The government had already indicated its sympathy with the idea. At the Labour party conference in September 2008, health secretary Alan Johnson  suggested the green paper may include greater centralisation of adult social care to prevent the current postcode lottery.

Meanwhile, green paper campaign coalition  Right care, Right deal - comprising Help the Aged, Carers UK and Counsel and Care - also backed a national system.

In a paper, the coalition questioned the basis of the traditional argument advanced for local decision-making - that it enabled councils to respond to local needs.

It said: “The reality of our overstretched service is that this tailoring is a myth – and most councils can do little more than provide the essentials to those in the most dire of need.”

Meanwhile, think-tank the Resolution Foundation also called for a national system of eligibility, saying that low earners found the postcode lottery particularly unfair.

One system or two

An area on which there has been less consensus is whether there should be a single system of funding for all care users or whether there should be two systems.

In October 2008, Leonard Cheshire Disability came out in favour of two systems. It said the systems should be distinguished according to people's possession of assets - rather than age. However, the charity made clear that its call was made in the interests of its core client group - younger disabled adults with impairments that are either lifelong or develop early in life.

The charity said many in this group lacked assets to pay for care because of limited opportunities to work or save, but were often excluded from state support by high eligibility criteria or charges.

But despite stating that it did not want to create an age-based divide - and that older people who lacked wealth should be covered by the same system as younger adults - the call drew criticism from Help the Aged.

Head of public affairs Kate Jopling said the reality of having two systems would create a divide at 65, which would lead to ageism.

However, Behan has suggested that the government is not averse to the idea of having two systems, based on whether people were of working age or retired. He stressed that this would not be incompatible with principles of equality, which did not mean "treating people the same".

How far services should be universal

One of the biggest questions is about how far services should be rationed and how far they should be universal.

When the green paper was announced in October 2007, the government said it would be determined by the principles of "progressive universalism" - the idea that all service users should receive a minimum level of provision, with a greater level of service for those with greater needs.

But since then the level of universalism has been a matter of some debate.

Under the Putting People First agenda to personalise care, the DH has said that all councils in England should provide advice, information and advocacy services to all users, regardless of whether they are eligible for publicly-funded care.

Some groups have taken this universalism further. For instance, the Resolution Foundation has argued for a right to regular, holistic assessments for all service users.

The key debate, however, is whether there should be a universal right to a personal care and support package for all people with a minimum level of need, regardless of means.

This call has been taken up by Age Concern. Others have not gone so far but called for means-testing to be radically reduced. For instance, the Hampshire commission of inquiry into the future of adult social care argued for the cut-off asset threshold for publicly-funded residential care to be more than doubled, to £50,000.

Tax tolerance

At the heart of this latter debate is the public's willingness to pay more in tax to fund social care. One key problem is the sharp fall in the proportion of workers to retired people, from 19:1 to 4:1, over the past century. It is set to fall further.

Also, public spending cuts are anticipated from 2011 onwards. The Institute for Fiscal Studies has calcluated that, on the Treasury's figures, average spending across government is set to fall by 2.3% a year in real terms from 2011-14, once spending on debt interest payments and social security has been taken into account.

Party consensus?

Amid a strong possibility that a Conservative government will implement the reforms, care services minister Phil Hope has said he is keen to find a party political - and societal - consensus on what should change.

Have your say

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Hampshire report to feed into adult social care green paper

DH survey reveals one-third believe future care will be free

Age Concern demand national entitlement to care and support

Right care, Right deal: End councils' role in adult care eligibility

Tories attack government complacency on care funding

CSCI wants eligibility criteria to be replaced

Means-testing v universality: the future of adult social care

Adult Green Paper: Can it plug the growing gap in services?

Care and Support: funding options for long-term care

Labour conference: Alan Johnson discusses green paper on adult care

LGA proposes single budgets for older and disabled people

Right care, Right deal coalition lays out green paper priorities

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