A new report commissioned by Age UK highlights the different approaches to long-term care across a group of countries in the developed world, and how they compare to the system in England.
The Incisive Health report ‘An international comparison of long-term care funding and outcomes: insights for the social care green paper’ set out to explore key characteristics and outcomes of the social care systems operating in some other advanced nations, with a view to seeing what lessons could be learned and potentially applied here in England. The other countries were Italy, Spain, France, Germany and Japan.
Challenges to the social care system
The findings suggest that creating a sustainable social care system fit for a rapidly ageing population is a challenge in every one of these countries, which none has completely overcome. However, most of the countries featured in the report have grasped the nettle and implemented significant reforms during the last 25 years. For example, Germany began to modify its system in 1995 and Japan in 2000. Over the same period, despite two Government consultations, two official Commissions, five Green or White Papers and one Act of Parliament, England’s system of means tested care funding is broadly unchanged.
It is notable that England has a stricter means test than the other countries examined in the report. England has a fixed means test limit for all long-term care services, meaning anyone with savings or assets above £23,250 has to pay all the costs of their long-term care (with tapered means tested support available to those with savings and assets between £23,250 and £14,250). Even those with savings and assets below the £14,250 threshold will still be expected to pay a contribution towards the costs of their care through a deduction from their State Pension. Other countries have more progressive systems, either providing a non-means tested basic level of support (Germany), capping the level of co-payment for all (at 10% in Japan), or using a more generous and gradual means test (France). Furthermore, in recent years England’s harsh means test has become increasingly less generous:
- Capital thresholds (£14,250 to £23,250) have not changed in nearly a decade: if the value of the means test had merely risen in line with inflation the upper level would be £25,559 today. This is effectively a 9 per cent stealth cut over the last ten years.
- Charges for care have increased as local authorities have come under growing financial pressure. In 2010/11 the average charge was £2016.49 a year. By 2013/14 (the last comparable year) this had risen by over £500 to £2563.90 (2015/16 prices).
- Since 2010 the Personal Expenses Allowance in a care home (i.e. the amount someone can keep out of their income for themselves) has risen by a miserly £2.60 to £24.30 a week.
Out-of-pocket payments to fund their own care
England and Germany both rely on citizens making high levels of out-of-pocket payments to fund their own care. In the UK, this amounts to 33% of the overall spend on long-term care. In Germany, mandatory social care insurance covers the costs of basic care with out-of-pocket expenditure only expected to pay for anything additional.
England also has a system with noticeably less risk pooling than other countries for the non-health aspects of the whole person care that people often require. In addition, in England long-term care needs which are paid for by the NHS are covered totally with risk completely pooled through the Continuing Health Care scheme, whereas needs that fall under the social care system have very limited coverage, with all the risk borne by the individual. This stands in contrast to the other countries included in the report where health and long-term care systems are more similar to each other, and this in turn means that people with dementia, for example, get a much better and fairer deal than they do here, where public outrage erupted last year over the so-called ‘Dementia Tax’ – something that would not have been possible in these other nations.
Quality based on standards
The report found that in in financially distressed social care markets, quality is better ensured by a system based solely on service standards, rather than price competition. For example, in Japan, the price of services is set nationally with recipients able to choose provider. This is said to keep quality high, with providers unable to undercut each other as happens here. A damaging ‘race to the bottom’ is therefore avoided.
The report commissioned by Age UK highlights the failure of successive governments to find a solution for to payment of social care. There is a drain in the confidence of people who work in the social care industry that the green paper, which has been put back and delayed now on a number of occasions, will provide a credible and acceptable solution.
While the other counties in this report continue to face challenges in the payment of social care, they have still accepted and implemented reform over the past 25 years. In England, successive governments have failed to agree reform, and have been left behind in the race. Resulting in an entire generation of elderly people who have “lost out” after various proposed care reforms have been left to “gather dust”.
Albert Cook Albert Cook BA, MA & Fellow Charted Quality Institute
Bettal Quality Consultancy