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Increase in Care Home Fees - Carers UK Forum

Increase in Care Home Fees

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Well, we've just had the annual letter from my mother's care home regarding the yearly increase in fees - just under 9% (that's nine percent - just in case you think I've hit the wrong number on the computer!).

Pretty shocked - and haven't plucked up the courage to tell mum yet (she's "all there" and takes a keen interest in her financial affairs, although we deal with everything).

Anyone else had similar increases???
Presumably mum is self funding? What does it say in the original contract about price increases?
I've had nothing yet from MIL's care home. BUT, I've had NHS CHC lot saying she needs another review, but the last one was less than a year ago.

It's saying it will go ahead, and can I get there for the date, but I can't, not for that date, though the email does say to get back to them about a second date. Since they pay the nursing care element of her self-pay care home, I DEFINITELY want to be there - not giving them a chance to say she's somehow miraculous better (she's worse) and evade funding it!

That said, the lady seemed perfectly nice last time, so hopefully it's just pro forma. But these days one does not dare assume anything.
Contract says that they can make an annual increase, plus any other increases caused by Government legislation, tax etc. etc. outside of their control. "Luckily" we have only had one increase per year!

Unfortunately, all these increases (26% on the original fees paid just over three years ago when mum first went into residential care) are playing havoc with our financial planning. Originally, her income (state and private pensions, attendance allowance and rental from her property) paid for half of her fees, with the other half coming from her savings. We had calculated that she had over ten years before we needed to think about selling her house (the only thing that really concerns her is that I - her only child - will be able to inherit it). This has now shrunk to about seven years because, although I appreciate that carers need to paid a decent minimum wage, there is no equal uplift in pensions and benefits to even half-way compensate.

I would also be interested to know what LA-funded residents are paying - am sure that the LA has not had an almost 9% increase in what they have to pay, and that self-funders are making up the difference.

Another concern is that it's impossible to see the accounts of the home, or get a breakdown of the increase (we tried this last year, with no luck).

There is absolutely no transparency with these companies - my husband is a retired financial director (of a UK Top 100 company) who can read a set of accounts and immediately see what is going on with a company. He is fairly certain that this latest almost 9% increase is way over the top, even taking into account the latest rise in minimum wages, plus new legislation on apprenticeships and pension contributions.

But we are over the proverbial barrow - mum likes the care home, the staff are lovely, but she's also "disgusted" (her own words) about this rise!
Does qualify for "NHS Funded Nursing Care"? Google this for more info. If she does, just over £100 a week would be paid towards her fees by the NHS.
The bottom line is that it's a 'seller's market' not a buyers one - there are more old folk in need of a good care home than there are care homes around.....

I'm always stunned at the disjunct between the hourly cost of having a professional care-worker come in and do anything vs the take home basic wage of that care-worker......WHERE does the 'difference' GO??? (I know, insurance, admin, tax, etc etc etc....)
Just a thought, but it might be one of the advantages of being in a care home that does NOT accept LA_funded residents, because then, even if fees are higher (since they are more likely to cater for the 'better off' residents who will never need LA funded care), at least one can be sure the self-funding residents are not co-funding the LA-funded residents!!!!
Although the care home is registered for nursing care (thinking ahead to the future!), there is no way that mum would qualify. Although increasingly frail and with difficulty walking, she's actually one of the more independent residents and needs a low level of care from the staff.
If you don't want to move Mum to a cheaper Home, then you might have to just bite the bullet. A lot can happen in 7 years.
I would look into whether the fact that she is renting out her property and the proceeds are partially funding her care, whether that means that she will have to sell when the time comes. Also I believe you could 'save' some of her assets by her gifting £3000 a year to you and any number of £250.00 gifts to different people (grandchildren?) You can also, when the time comes, make an arrangement whereas the property is set against the cost of care when her savings run down too far. Depending on how much is owing, you might be able to 'buy it back' or even pay the extra yourselves upfront in the hope that the value of the property increases enough to compensate when you sell it eventually. All comes down to money of course. Plus there's that 40% inheritance tax to consider if her assets exceed the allowance.Your husband will be the one to work all that out of course. Worth looking into it all though. I'm not asking questions here by the way. Just making suggestions that you have probably already thought of, (or your husband will have.)
Please don't get me wrong - we're not looking to "save" money here. I would happily end up with zero inheritance if that's what it takes to keep my mother in decent care.

I guess it's just the inherent "unfairness" of the situation - the fact that the parent company can increase rates well above the norm (even taking into account minimum wages etc.) with no explanation or justification or transparent accounting, that my mother's weekly care bill of over £800 pw is almost certainly subsidising other LA-funded residents and that they know that our only recourse is to move mum (which we would never do).

Just a final comment regarding the subsidising of LA-funded residents. It was extremely interesting to hear on yesterday's Radio 4 Baroness Altman coming out and saying quite candidly that care home companies are definitely overcharging self-funders to make up the shortfall on those who are LA funded!