In this section, we have provided helpful articles for your information. Click on the links below to read each article.
- Solicitors for the Elderly July Update
- Solicitors for the Elderly June Update
- Care Home Fees, What You Need to Know
- Who Cares Who Pays? Funding of Long-Term Care
- Lasting Powers of Attorney
- Giving Away Your Home
Healthcare travel costs scheme:
Under the Healthcare Travel Costs Scheme amended on 7th April 2010, patients on low incomes or receiving specific qualifying benefits or allowances may be reimbursed in part or in full for costs incurred in travelling to receive certain NHS services.
Prescription charges review
Professor Ian Gilmore, President of the Royal College of Physicians led an independent review on how prescription charge exemption for people with long term conditions should be implemented.
This review, the Gilmore Report has now been published by the Government.
MENTAL CAPACITY UPDATE
Office of Public Guardian
The Office of Public Guardian has implemented actions to improve its service. There are now weekly updates on the Office of Public Guardian website and on the standard customer letters advising of any issues and the expected time it will take to register an instrument.
Court of Protection first report
The first report from the Court of Protection has been published, covering the period between 1st October 2007 to 31st Decmeber 2009. The failure to anticipate the increase in workload, a lack of judges and cumbersome rules were highlighted however the regional judges work and the move of administration to Her Magestys Court Service were welcomed.
- The Court receives about 1600 applications per week
- During its first two years the Court received 39,579 applications relating to property and financial affairs.
- Only 6% of cases result in a hearing.
- Almost half of all hearings listed in 2009 were outside London.
Will-writers’ code of practice
The Office of Fair Trading has apporved the Institute of Professional Will-writers’ new code of practice. The code requires members to pass an entracne exam, undergo continuing training and have indeminty insurance.
Charges in Probate
On June 16th The Daily Mail reported on the explitation of will-writers and Banks in their charges for probate. They offer cheap wills, have themesleves appointed executor and then charge tens of thousands of ounds for executing the estate. It noted that most estates could be dealth with by friends and family with the help of a solicitor for a fraction of the cost. Research conducted by Which? Identified that many people were not given full advice about costs upfront by will-writers and banks. Which? Also reported concerns with poor advice given by four of tweleve specialist will-writing firms it visited. The Daily Mail article highlights the lack of protection if things go wrong with the unqualified, unregulated and uninsured will-writing practices.Firm Cost of Will Cost of adminstrating average sized estate Barclays £80 £13,395 Lloyds/HBOS £119 £10,800 Natwest £100 £12,220 Banks average £85 £10,830 Will-writers average £107 £4,759 Solicitors average £133 £5,199
MANAGING FINANCES UPDATE
The Emergency Budget
The key points in the budget which affect older and disabled people:
- Personal Income Tax allowance to be increased by £1,000 in April 2011 to £7,475.
- VAT will rise from 17.5% to 20% from 4th January 2011
- Housing Benefit: New maximum limit of £400 a week for properties with more than three bedrooms, £250 a week for a one-bedroom flat, £290 for a two-bedroom property and £340 for a three-bed property.
- From April 2011, Housing Benefit claimants with a disability and a non resident carer will be entitled to funding for an extra bedroom.
- The basic state pension will be linked to earnings from April 2011 with the pension guaranteed to rise in line with earnings, prices or 2.5% whichever is the greater. The government will accelerate the increase in state pension age to 66.
- The government may phase out the default retirement age to ensure those who want to work past 65 are able to do so.
- The annual ISA subscription limit will increase from 2011-12.
- Key benefits for older people including Winter Fuel Payments, free off-peak local bus travel, eye tests and prescriptions for those aged over the female State Pension Age and free television licences for those aged over 75 are unaffected.
NHS continuing healthcare
In simple (non legal) terms an individual has a primary health need if, it can be said that the main aspects or majority part of the care they require is focused on addressing or preventing health needs.
A healthcare need is one related to the treatment, control or prevention of a disease, illness, injury or disability, and the care of aftercare of a person with these needs. A social care need is one that is focused on providing assistance with activities of daily living, maintaining independence, social interaction, enabling the individual to play a fuller part in society, protecting them in vulnerable situations, helping them to manage complex relationships and accessing a care home or other supported accommodation.
The National Framework for NHS Continuing Healthcare and NHS-funded Nursing Care talks about characteristic of eligibility:
- ‘Nature’ is about the individuals needs and the interventions required to meet those needs.
- ‘Intensity’ is about the quantity, severity and continuity of needs.
- ‘Complexity’ is about the level of skill/knowledge required to address an individual need or the range of needs and the interface between two or more needs.
- ‘Unpredictability’ is about the degree to which needs fluctuate and thereby create challenges in managing them.
Each individual case has to be considered on its own merits in accordance with the principals outlined in the framework however these four characteristics help determine the quality and quantity of care required.
Coalition Government’s Plans for NHS
The coalition government has confirmed plans for one of the biggest reorganisations of the NHS in its history. Strategic Health Authorities which are responsible for enacting the directives and implementing fiscal policy, as dictated by the Department of Health, at a regional level will be downgraded within the next two years and partly replaced by an independent board which will set priorities for the NHS. Strategic Health Authorities would continue to have a role in delivering financial control and performance, and driving improvements in quality and productivity.
At a local level, GPs will take on greater responsibility for organising and purchasing care. This would create changes for Primary Care Trusts.
Primary Care Trusts
Primary care is the care provided by people you normally see when you first have a health problem. It might be a doctor or dentist, an optician or a pharmacist, NHS walk-in centres and the NHS Direct telephone service are also part of primary care. All of these services are managed for you by your local primary care trust (PCT), there are currently 151 primary care trusts in England. Your PCT will work with local authorities and other agencies that provide health and social care locally to make sure that your local community's needs are being met. As they are local organisations, PCTs understand what their community needs, so they can make sure that the organisations providing health and social care services are working effectively. They are also responsible for getting health and social care systems working together for the benefit of patients.
Primary Care Trusts were created by the Labour government, and in their relatively short history have already been reorganised. In 2006 the numbers of PCTs was halved to 151, a process which was criticised by doctors at the time. The Coalition Government plans to have directly elected individuals on the boards of their local primary care trust. The remainder of the PCT’s board will be appointed by the relevant local authority ensuring a balance between locally accountable individuals and technical expertise. It will also take responsibility for improving public health for people in their area, working closely with the local authority and other local organisations.
Who’s who in the Department of Health
Simon Burns MP – Minister of State for Health
Paul Burstow MP – Minister of State for Care Services
Anne Milton MP – Parliamentary Under Secretary of State for Public Health.
Who’s who in the Ministry of Justice
Rt Hon Kenneth Clarke QC – Lord Chancellor and Secretary of State for Justice Jonathan Djanogly – Parliamentary Under-Secretary of State, responsibilities include:
- Legal Services
- HM Courts Service, Tribunal and Administrative Justice
- Offices of the Public Guardian
Tom McNally – Minister of State and Deputy Leader of the House of Lords, responsibilities include:
- Legislation and Law Reform
- Public Law and Public Legal Issues
Currently in the UK people needing residential care are entitled to support from their Local Authority provided that they have an income of less than 23,000. Furthermore if your income is 14,000 or less you will be entitled to full support from your Local Authority. If your income is between 14,000 and 23,000 you will be required to contribute 1 per 250 between 14,000 and 23,000 for example should your income be 15,000 you will be required to contribute 4 per week towards your care.
Need for constant medical care
It should be brought to the attention however of those requiring care that should they be categorised as requiring constant medical care then you may qualify for free care should your application for continuing care be successful for this to your Primary Trust or NHS board. The NHS states that constant medical care is defined as care that is provided over an extended period of time to meet physical or mental health needs that have arisen as a result of disability, an accident or illness.
The Local Authority is entitled to consider your home as part of your income or capital after you have been in care for more than 12 weeks. But it is highlighting that those who reside in their home with their spouse/partner or a relative over the age of 60 or below the age of 16 cannot have their home counted as capital or income. This is because the law states that only the income and savings of the individual only should be considered in determining the funds and assets available for use in paying care homes.
Case study of Mrs. X
Mrs. X resided in her property with her husband and daughter with them all having an equal share in the property known as a joint tenancy. However Mrs. Xs daughter could prove that she had contributed to the house and its mortgage payments since 1991.
Sadly Mrs. X required constant medical care and Council Y tried to seek the cost of the care home fees by placing a restriction on the property through the Land Registry. This meant that the property could not be sold without the care home fees being paid.
However with the help of The Legal Practice Solicitors we were able to help Mrs. X recover her care home fees and have the charge removed. We did this by proving that due to the mortgage payments since 1991 Mrs. Xs daughter could be seen as the sole owner, this claim was backed up by the fact that Mrs. X required constant medical care therefore we argued that the Local Primary Care Trust should cover the cost of the Care Home Fees as Mrs. X was entitled to continuing care. We were even successful in getting the legal costs of Mrs. X back.Back to Top
What happens if you go into a care home?
Funding of Placement
The cost of care, if you have a primary health need should be funded free by the NHS. In many cases this should be considered first and you should seek advice about it.
There are other situations where you do not have to pay for your care including: -
If your place in a care home has been arranged as part of a package of “intermediate care” where you are having short-term therapy or treatment, either following a period in hospital, or to avoid you having to go into hospital, it will be free. Such care is time limited and not normally longer than six weeks.
If you have previously been detained in hospital under Section 3 of the Mental Health Act 1983 (this would be for treatment), your residential care may be provided as aftercare under Section 117 of that Act. The Local Government Ombudsman has recommended that Local Authorities which had previously charged for such services should have taken steps to identify residents who may have been improperly charged and taken steps to reimburse them or their estates.
Some War Pensioners
The Veterans Agency, formerly the War Pensions Agency, can pay towards the cost of a care home providing nursing for War Pensions in very specific circumstances. This is for people with a Higher Rate of War Pension.
Self-Funding Your Care
If your care needs are ancillary or incidental to the need for accommodation, you will need to fund the cost of your care, if your capital is over £23,000 (England) or £22,000 (Wales) (2009/10) but you will have help towards this from:
- Attendance allowance/disability living allowance (Helpline 0845 3000336) – Higher rate £70.35 (2009/10)
- The NHS pays a contribution towards the nursing care provided by a registered nurse, where you receive care in a nursing home (RNCC) (£106.30 in England, £117.66 in Wales), for 2009/10.
Social Services Supported Care
If you do not have sufficient resources and you are assessed as needing to be cared for in a care home, you will receive help from the social services department of your local authority
- Social services only pay up to a “standard” amount
- Often there is a shortfall and families are asked to pay. This should be resisted whilst legal advice is taken.
- Much of your income (including £1 per week “tariff” income) for every £250 between £14,000 to £23,000 (England) and £20,750 to £22,000 (Wales) (2009/10) will go towards your fees. Certain income is disregarded including 50% of your occupational or personal pension providing you pass the other 50% to your spouse or civil partner, if they are not living in the same home. You must be left with £21.90 for your personal expenses in England and £22.00 in Wales for 2009/10.
When the social services work out what you should pay towards your care, how will your property be treated?
Your property will be disregarded if: -
- Your placement is temporary
- Your home is occupied by your spouse, a partner, former partner or civil partner (except an estranged or divorced partner, former partner or civil partner unless they are a lone parent)
- A relative or family member (from a specified list) who is: -
- Aged 60 or over
- Under 16 and a child whom you are liable to maintain
- Incapacitated (someone in receipt of incapacity benefits or has needs which would qualify for such benefits)
Social Services have discretion to disregard the value of the property if another person, not falling under the above (‘a third party’) continues to live there. It may be reasonable, for example, to disregard a dwelling’s value where it is the sole residence of someone who has given up their own home in order to care for the resident, or someone who is an elderly companion of the resident, particularly if they have given up their own home.
Other assets disregarded include: -
- Capital of £14,000 or less (England) £20,750 (Wales) (2009/10)
- Personal possessions, unless purchased with intention of reducing one’s capital in the assessment.
- Capital value of a life interest in land or trust fund.
- Capital value on an interest in a personnel injury trust including compensation for vaccine damage and criminal injuries.
- Skipton Fund payments to people who have been infected with hepatitis C as a result of NHS treatment with blood or blood products.
How does all this work?
Mr & Mrs Campling live in a manor house in Shropshire. It is worth £2,000,000. The manor house contains antiques and other valuables worth £100,000. Mr Campling is to move into a care home has savings of £10,000 in his sole name. His wife has £100,000 but in her sole name. Mr Campling has a State Pension. His wife has income from the Family Trust.
What about co-owned property?
Perhaps you own a property with your son or daughter. In this case the value of your share may be nil because it is unlikely that anyone will be prepared to purchase your share on the open market. Legal advice needs to be obtained and an argument put forward as this is a complex area.Mr Campling will be required to use his State Pension towards his care but will retain £21.90 of it for his personal expenses.
What about co-owned savings?
Social services have no power to demand to see the finances of a spouse or partner of someone going into care however, if there is an account in joint names they can see what the spouse has.
Deliberate deprivation of capital or income
If you give away assets or otherwise dispose of them in order to put yourself in a more favourable position to get social services financial assistance with your care home fees, they may be able to assess you as if you still have the assets.
- Mr Jones had £18,000 in a building society.
- 8 weeks before entering a residential home he bought his car for £10,500 which he gave to his son shortly before entering the home.
- Is this deliberate deprivation?
- When Mr Jones bought the car he was in good health and had no expectation of going into care.
- He had a serious stroke one week after making the gift.
This is unlikely to be contested as being a deliberate deprivation in view of all the circumstances.
Possible action to consider to prepare for the time when you might need long term care
- Separate jointly owned savings. Did your spouse contribute more to the savings account than you? In those circumstances, it would be proper for you to put more into their account than yours.
- Are you much older than your spouse/partner? Should you gift some savings to your younger spouse now?
- Is the house in your sole name? Should it now be put into joint names and if so consider putting it into joint names as Tenants in Common rather than as Beneficial Joint Tenants? In the former case, the death of one co-owner does not automatically mean that his or her share passes to the survivor who may already be in a residential home.
- Review your Wills. If you go into a care home, is it sensible for the Will of your spouse/partner to leave everything to you? It may be appropriate for them to set up a Discretionary Trust so that you can receive capital and income as necessary, but ensure that this is not taken into account in any means test.
- Have you signed a Power of Attorney? These documents put in place trusted people who can act for you in your lifetime in relation to your finances and property. If someone loses mental capacity to deal with their finance and property and they have NOT put into place an Enduring Power of Attorney before 30 th September 2007 or a Lasting Power of Attorney since 1st October 2007, an application has to be made to the Court of Protection to appoint someone to act on behalf of that person. This is a costly exercise in money, time and emotion and means that you will act under the directions of the Court of Protection in everything you do for your relative.
- Consider an Advance Medical Decision. In circumstances where you have lost mental capacity and can no longer make choices about treatment to keep you alive, a decision made in advance to the medical profession must be taken into account so long it was made when you understood what you were doing, had been offered sufficient and accurate information to make an informed decision and the circumstances and treatment that subsequently arose are those which were envisaged by you. You must not have been subjected to undue influence or have modified the advance decision either verbally or in writing since it was made. See the SFE leaflet on advance medical decisions.
This Fact Sheet has been prepared to provide you with basic information about paying for care. It is not to be treated as a substitute for getting full and specific advice from a specialist lawyer. Updated May 2009.Back to Top
From the 1st October 2007, you are able to make a new type of power of attorney, called a ‘lasting power of attorney’ (LPA). A power of attorney is a legal document where a person gives another person or persons (the attorney) authority to make certain decisions on his or her behalf.
Types of LPA
There are two types of LPA:
- A property and affairs LPA, which allows your attorney authority to deal with your property and finances, as you specify
- A welfare LPA, which allows your attorney to make welfare and health care decisions on your behalf, only when you lack mental capacity to do so yourself. This could also extend, if you wish, to giving or refusing consent to the continuation of life sustaining treatment
As with any power of attorney, it is an important document and you should take care whom you appoint as they should be trustworthy and have appropriate skills to make the proposed decisions. If you appoint more than one attorney, you can appoint them to always act together (jointly) or together or separately (jointly and severally). You may even appoint them to act jointly for some things and jointly and severally for others, although this should only be done with advice, as it may cause problems when using the power.
You may also choose to appoint a successor to your attorney, in case they die or otherwise cannot act for you.
When can the Attorney act?
The attorney will only be able to act when the LPA has been signed by you and your attorney, certified by a person that you understand the nature and scope of the LPA and have not been unduly pressured into making the power. The certificate will also need to confirm there has not been any fraud or another reason why you cannot make the power. It must then be registered with the Office of Public Guardian before it can be used. The financial LPA can be used both when you have capacity to act, as well as if you lack mental capacity to make a financial decision. The welfare power can only be used if you lack mental capacity to make a welfare or medical decision.
Existing Enduring Powers of Attorney
Any enduring power, validly made before 1st October 2007, will continue to be able to be used but only in respect of your property and affairs. If you wish to give authority over your health or welfare you will need to make a welfare LPA.
What happens if you have not made a LPA or EPA?
If you lack capacity to make a financial decision, then it may be necessary for an application to be made to the Court of Protection for an appropriate order, such as appointing another person to make decisions on your behalf. This is both costly and time consuming.
Most care and treatment decisions can be made on your behalf without the need for a court application. However, if you wish to avoid potential disputes, you can give a person(s) authority to make those decisions on your behalf by making a welfare LPA.
Advance Medical Decisions
An advance medical decision, often referred to as an ‘advance directive’ or ‘living will’, is a written statement of your wishes about medical treatment if you become terminally ill or incapacitated. An advance medical decision allows a person to refuse specified treatment in specified circumstances such as: -
- Physical illness which is so serious that life is nearing an end and there is no likelihood of recovery;
- Permanent serious mental impairment with physical illness and/or Permanent unconsciousness
You are completely free to refuse to undergo medical treatment even if, as a result it brings about your death. However, you must have the mental capacity to make that decision. The Mental Capacity Act 2005 gives clear legal status to advance medical decisions, which means that health professionals must follow them, if they are valid and applicable to the specified treatment and circumstances.
It is important that an advance medical decision is well drafted so it is valid and applicable to the specified treatment and circumstances. You should discuss your wishes with your immediate family. The document is not intended to be a substitute for discussion with medical staff and it is always recommended that you talk fully with your doctor about your treatment. An advance medical decision does not ask a doctor to do anything against existing law, but it is useful when decisions have to be made on prolonging an individual's life.
An advance medical decision will be valid if: -
- You have the mental capacity to make the decision to refuse treatment;
- Your refusal was intended to apply in the kind of situation which later arose;
- You understood fully the consequences of such decision in that kind of situation and,
- There was no undue influence made by anyone else on your decision.
If you change your mind at a later date, an advance medical decision is not final and irrevocable and can therefore be changed by telling your doctor. However, it is sensible to destroy the document and all copies of it.
This Fact Sheet has been prepared to provide you with basic information about advance medical decisions. It is not to be treated as a substitute for getting full and specific advice from a specialist lawyer. Updated January 2009.
To find out how the Legal Practice Solicitors could help you with discovering what you REALLY should be paying for your care home fees and how we can help you resolve any issues with Care Home Fees that you may be entitled to have paid by the Local Authority contact us on 0208 903 7017.Back to Top
For a variety of reasons many people wish to transfer their home from their name into that of another. It is important that the implications of transferring your home are fully understood, so the advantages can be weighed against the disadvantages and you make the appropriate decision for you.
Responsibility for the home
Although you may give your home away, you may agree to be responsible for the buildings insurance and general maintenance. You might be quite happy with the responsibility, but what may seem straight forward in the early stages could cause problems later on if you cannot financially afford to continue these payments.
To prevent any future problems, discuss and establish who is to pay for all major outgoings of the property. Although it is your home, if you no longer own it, you could be asked to pay rent by the owner(s). They may even sell the property and you could have no home.
If the person(s) you have transferred your home to, were to become divorced or bankrupt, their ex-spouse or Trustee in Bankruptcy could have a claim on your home and you could end up homeless. Consider if this is likely, and ask questions to see if there is a real risk. Similar problems can arise if the person to whom you transfer your property dies before you do.
Once your home has been transferred out of your name, it will not form part of your estate when you die and will not be disposed of in your Will. This may save on probate court fees and administrative costs to your estate when you die. It may however be added to the value of your estate for Inheritance Tax purposes.
The person(s) to whom you transfer your home will need to make provision for your occupancy within their own Will.
Inheritance Tax may be payable on your death on assets, including savings, investments and property over, £325,000 for 2009/10 tax year, with a planned increase to £350,000 for 2010/11 tax year (‘the nil rate band’). Tax is payable on the amount over this figure at 40%. This figure is reviewed annually in the Budget.
If you have made gifts of money or assets away in your lifetime over £3,000 and within 7 years of your death, the value of these gifts may be added to whatever other assets you own when you die, to determine the tax payable. There are complicated tax implications if you transfer your home and still live in the property when your assets, including the value of your home are worth over the nil rate band.
If your estate is likely to be taxable, it is important for you to receive tax planning advice before transferring your home.
Capital gains tax
If you own your home and live there, no capital gains tax is payable when you transfer the ownership, on any gain made on the original purchase or acquisition price. The person(s) you transfer your home to will acquire it at the current market value. There may be tax payable by them when they eventually dispose of the property and they should obtain independent legal advice on the implications.
Means tested state benefits
If you are in receipt of means tested state benefits, such as income support and you give away an asset such as your home, which appears to the Department of Works and Pensions (DWP), that you did so with the intention to reduce your assets, so as to qualify for certain benefits, they may assess you as if you still own the asset.
Similar rules apply to financial help, which may be available from local authorities, for example if you need to move into a care home. If at a later date, you apply for financial assistance from the DWP or local authority, depending on how much time has passed since the transfer and the reason for the transfer, the value of the asset may be ignored when assessing your entitlement to financial support.
This Fact Sheet has been prepared to provide you with basic information about some of the ramifications of giving away a home. It is not to be treated as a substitute for getting full and specific advice from a specialist lawyer. Last updated May 2009.Back to Top