The report on Funding Care and Support has made proposals that will overhaul the present “creaking system” that is no longer fit-for-purpose, said economist Andrew Dilnot.
In the report titled Fairer Report Funding, Dilnot’s commission proposes a shared responsibility model where by both the state and the individually shares the funding burden of long-term care together. In the 80 pages report, the commission has recommended that individuals with assets more than £100,000 pay for their in-home or nursing home care, while people with assets of £35,000 and up to £100,000 will be eligible for means-tested benefits. The state will fund care expenses for individuals with assets less than £35,000.
Those with highest needs will benefit the most from the new proposed system he said, adding that everybody will have peace of mind.
Excitement was a theme running through the report, Mr. Dilnot said while addressing a press conference in Westminster this week. Although there’s no denying the fact that the current care system is under enormous pressure, he said we should be “celebrating the fact that there are more old people” around.
“We can adjust to these changes and we don’t need to be frightened. There is every reason to think that we will return to economic growth. We have the resources that we need in this area”, he said.
The proposed reforms should stimulate the financial services market into innovation, said Mr. Dilnot.
“These products could be linked to pensions, savings, insurance and housing. At the moment, no major financial services providers offer pre-funded insurance against social care because of the risk and uncertainty involved. We take away that extreme cost by risk pooling through state intervention, opening up a space where the financial services sector can operate”, he added.
The FSA will however, keenly watch the developments of new care products, said managing director of FSA Margaret Cole. “The FSA has a close interest in the development of private sector financial services solutions to care funding. We will be active in supervising the development of products, especially in light of previous problems with pre-funded long-term care insurance”, she said.