How many will be helped by the cap on social care costs?
19th Jul 2013
For many years now, the social care system has languished in a state of near collapse. Inquiry after inquiry has looked into how it might be improved and, crucially, how any reform might be funded.
Earlier this year, the Coalition announced that it would impose a cap on social care costs. At present there's no way for someone to protect themselves against excessive costs - social care isn't free at the point of use (unlike the NHS) and there are no pre-paid insurance products on the market. The government's policy means that, in theory, nobody will pay more than £72,000 towards their care. After this point, the state will pick up the bill.
Looking at the details, the Daily Mail wasn't particularly impressed, noting that "Just one in eight pensioners will benefit from the much-vaunted 'cap' on care".
The source of the Daily Mail's figure is, in fact, the Department of Health (DH), which briefed journalists on the practicalities of the new policy.
DH has just published an impact assessment, in which it outlines how many people it expects will be helped by the cap on care costs. According to an academic model (based on a cohort study of those aged 65 plus), 16% of pensioners needing care will be entitled to state support.
Those with more severe needs will run up higher bills and they're the ones who'll be entitled to financial assistance:
This 16% doesn't amount to "one in eight" - it's more like one in six. But not all pensioners will need social care. The same model suggested that 20% of pensioners will not need social care during their lifetimes. This means that 80% of pensioners will need social care, and 16% of them will exceed the cap. This amounts to approximately 12% (or 1 in 8) of all pensioners.
The Department of Health told Full Fact that "one in eight" is a more appropriate description than a specific percentage, which tends to suggest a level of precision that the model doesn't afford.
A sticking plaster over a gaping wound?
The government has admitted that its social care cap is not a "panacea". However, it insists that everyone (not just the 16% estimated to exceed the cap) will benefit from the "peace of mind" that comes from knowing they will not face unlimited costs. That, as anyone knows, is something you can't measure.
Perhaps more importantly, the "one in eight" figure doesn't take into account the number of pensioners who will be helped by the raising of the means-test threshold. Currently, anybody with more than £23,250 of assets (in other words, anyone who owns their own home) is on their own. The government will now raise this limit to £118,000 in 2016/17 prices, which will mean that more people are entitled to some level of help. (For further details on how this will work, you can read our factcheck here.)
The cap is only one component of the government's plan to overhaul the social care system. For this reason, the "one in eight" figure, which looks at the effect of the cap in isolation, isn't particularly useful. The government projects that the cap on costs plus the extended means-test will help 100,000 people by 2026.
For many who have campaigned for reform, to argue about how many will reach the level of the cap is to miss a more important point - that the 'cap' is not actually a cap. Critically, someone's general living expenses (which the government estimates at some £12,000 per year) are not part of their "care costs". So even once they've reached the cap of £72,000, they will still need to pay for bed and board at their care home.
Certain charities are concerned about the way the government has publicised the introduction of the cap, arguing that there has been little mention of the terms and conditions. The government has already begun to 'manage expectations' around the policy, but it might yet need to make the smallprint clearer.