Just Group has found a disparity in care home fees for council-funded and self-funded clients and is calling for urgent social care reforms to tackle the unfairness.
Residents of care homes in England who meet their own fees are charged an average of £12,500 a year more than those whose bill is picked up by their local authority, analysis by Just Group reveals.
The average annual fee for self-funders is £44,252, far higher than the average fee paid by councils, which sits at £31,720. The difference between the two groups is £12,532, or more than £1,000 a month extra for the self-funder.
Stephen Lowe, Group Communications Director at Just Group says, 'These figures start to explain why people think care fees are unfair when those footing their own bill are charged many thousands of pounds a year more than another person who could be in the same home and receiving the same care but paid for by the local authority.
'The proportion of care home firms operating this differential pricing has also increased markedly, according to the Competition and Market Authority (CMA), with about 90% of homes now charging self-funders more than they charge councils compared to about 20% back in 2005.'
The CMA’s report found that the fees paid by councils don't cover the costs of running care homes, which therefore requires homes to increase prices for self-funders, increasing the disparity in care home fees. This subsidy is highest in homes with a fairly even mix of places between the two groups.
According to Mr Lowe, a lack of Government progress on reforming the later life social care market is putting more financial pressure on those needing care and their families. Just Group states this is also a material factor in people waiting before putting any plans in place for themselves – more than half (51%) of over-45s are delaying making plans for later life until new policy is clarified, according to Just Group’s 2019 Care Report.
Mr Lowe continued, 'For many people, planning for later life care consists of crossing their fingers and hoping it doesn’t happen to them, but when it does, the cost is a real eye-opener, as our 2019 Care Report reveals.
'Three-quarters of over-45s who had been involved in arranging care said they were surprised by how little financial support the State provides and nearly nine in 10 (88%) were shocked at how expensive care is.
'With the care crisis deepening, the Government must take the lead and be clear that reforms are on their way.
'The public isn’t fooled by promises and no action – more than half (52%) agree that social care policy is being neglected because of Brexit.
'Brexit is undoubtedly a big issue but the parlous state of today’s social care system is letting everybody down – councils, care homes, care workers and of course the residents who are most vulnerable of all. The promise of more funding is welcome but it doesn’t address the total absence of any long-term policy to address the fundamental problems within the social care system.'