Behind the headlines: 'stuck in the middle' - self-funders in care homes

Age UK study highlights how cost pressures on care homes arising from the funding crises in social care adversely impacts on self funding residents.

A new Age UK study highlights how cost pressures on care homes arising from the funding crises in social care adversely impacts on self funding residents.

Care home providers are under severe cost pressures due to the squeeze in rates paid by Local Authorities for care beds. The report points to research that estimates self-funders on average pay of £603-£827 per week every year for a care home placement as compared to Councils paying £421-£624 per week. The outcome is that self-funders are effectively subsidising the state funded residents.

The report looks at the broad themes that have emerged from calls taken by Age UK information and advice line from care home residents and their families. The report highlights the extent to which self funding residents face extra charges and contractual terms and the relative lack of legal protection for self-funding residents as compared to residents funded by statutory bodies who benefit from the contractual protections and the Human Rights Act 1998. 

The broad themes identified in the report include:   

1. Care homes demanding payments in advance that are onerous;
2. Unexpected or arbitrary fee increases;
3. Paying for "extras" which are not mentioned or ill-defined in the contract;
4. Relatives of residents being asked to guarantee care home fees even when the resident becomes entitled to statutory funding. This is inappropriate when the resident may become entitled to local authority funding before they reach the stage where their money runs out but, before they reach this stage, the care home are worried that the local authority will only pay fees at a much lower weekly rate and therefore they ask the relative to agree to a top-up of the Council fee.
5. Relatives being asked to agree not to approach the local authority when the resident becomes eligible for Local Authority funding;
6. Onerous contractual terms in which notice period is disproportionate and excessive and amount to a financial penalty particularly in the context of the resident moving because of the poor quality of the care home;
7. Residents who are admitted to hospital still required to pay the care home fees even in instances where they will not be returning there.

Age UK identifies a number of concerns regarding the fairness of some care home contracts. They take the view that the case studies demonstrate how vulnerable older people in need of a care home placement are to unfair contract terms. They also identify that older people and their families are at risk of being treated unfairly if they fund their own care because care home residents have very few legal rights. For example they do not have security of tenure and can be evicted at will. In their view, this leads to reluctance by residents or their families to complain about unfair actions by care homes in fear of jeopardising their accommodation. The report argues that the previous OFT 2003 guidance needs to be updated.

The report highlights that National Living Wage introduced in April 2016 represents another cost pressure on care homes which, in light of the recent research by the Kings Fund and the Nuffield Trust, illustrates just how fragile care homes are with increased risks of large scale provider failure.

Overall, Age UK conclude that this is a further ongoing failure by government to get to grips with the fact that, although the number of all the people in the population is rising, and that the lifespan of individuals is increasing, this has not been with a commensurate increase in state funding for care and support to keep pace with the rising numbers of elderly people who are living with complex conditions. As a result, care homes have been asked to care for people who have much higher levels of need without the resources to meet their needs

Austin Thornton of Wrigleys Solicitors comments "unless there is a commitment at national level to 'grasp the nettle' and improve the financial viability of adult social care then self-funders will increasingly bear the cost of care homes keeping afloat. In effect self funders have become the 'squeezed middle'."