Past caring? Widening the debate on funding long term care

My paper for ILC-UK on social care finance and the ‘mixed economy’ of social care.

‘Past Caring? Widening the Debate on Funding Long Term Care’ addresses one of the most controversial and intractable issues in UK politics today: how to fund long term care. Its main aim is to broaden the debate with reference to a range of issues that must be taken into account before a sustainable and fair funding settlement can be reached. The think-piece builds upon elements of various models proposed in recent years to sketch a series of ideas which could be adopted by the Dilnot Commission, or incorporated at some later point as a skeletal funding system evolves in operation.

The think-piece argues that the partnership model, a variant of which is likely to be proposed by the Dilnot Commission, offers significant opportunities for a fair and sustainable funding system for long term care, given that it could lead to the removal of means-testing, and offers an ambitious vision for the role of the state and general taxation in care funding. But it suffers from what is termed here ‘the pot fallacy’. It assumes that an individual’s care needs can be quantified by estimating the cost of meeting these needs. In reality, the existence of three ‘frontiers’ within the mixed economy of care (between care provision and health provision, between formal and informal carers, and between care and array of other services which feed into care delivery, most notably housing) defy the notion of the pot; it is increasingly at these frontiers where innovation in care delivery will occur.

The think-piece also argues that many aspects of care provision should be more closely integrated with health provision, paid for by the taxpayer but with scope for individuals to top up state-funded provision. Crucially, however, not all care needs can be addressed in this way. Care needs are essentially amorphous; many are most appropriately met by families and communities, and the funding system should recognise this amorphousness. Many services will also be provided through innovative mechanisms such as extra care housing, funded through both public and private mechanisms. Given that many people will also seek to top up services or insure against the risk of care needs arising at a level not deemed appropriate for universal, taxpayer-funded services, private insurance will have a significant role in the future of care funding.

Such changes will by necessity emerge piecemeal rather than perfectly formed. Yet the crisis is now. As such, the think-piece develops a short-term solution which builds upon aspects of ILC-UK’s social insurance model, while arguing that the social insurance principle may no longer be an appropriate foundation for welfare provision, and that ultimately means-testing within the care funding system must be eliminated.

Click here to access the full document.

Image: Dave Gibbs

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