In the wake of the delayed care reforms in England, Stuart Wilson, Air Club Chairman, talks to Care Expert, and Air Ambassador, Jacqueline Berry from national care navigation firm, My Care Consultant, to find out answers to some of the burning questions of the moment, including what the delayed care reforms mean for clients in need of care today, what advisers can be doing about it, and why firms can no longer ignore this area of advice.
What does My Care Consultant (MCC) do?
We’re an independent care navigation company that I founded in 2016, following many years of working directly with financial advice firms in support of their own clients where I learned how difficult and time consuming it was proving for many to provide the non-regulated aspects of care planning in-house. I identified there was a need for a trusted, independent safe space, where consumers could go to get access to reliable information, as well as signposting to reputable 3rd party services such as legal and financial advice, and care provision. After spending over 24 months researching the type of help consumers need, and how they want it to be presented, MCC was ready for business!
Our ultimate aim is to help those in need of care, their families, their carers or legal representatives navigate the complex UK care systems. Essentially, we provide information and guidance to answer 4 key questions that clients have that cover issues sometimes referred to as the non- regulated aspects of care advice:
- Where and how can I get the care I need?
- Am I eligible for NHS or Local Authority Support?
- Am I entitled to any other financial support
- If I am a self-funder, what are my options?
Once we’ve established that a client is going to have to fund some or all of their care, we refer them back to their financial adviser to determine the best way for them to do this. If they don’t have a financial adviser, we refer them on to a SOLLA Accredited adviser as well as signpost to other professional services that they might need such as legal services.
In an ideal world of course we shouldn’t have to exist, but the harsh reality is that most consumers have no idea who to turn to when they first address a care need for themselves or a family member and when they do turn to the obvious sources of help, the social services department of their local authority, their GP or the NHS sadly they cannot be guaranteed of getting the correct advice or support. The problem is they are often not in a position to know whether this is the case or not until some time later.
In 2019, we launched a second (B2B) service for financial advisers called ‘Care Box’ – in return for a small monthly or annual membership fee, our Care Box members have 24/7 access to up-to-date and accurate information relating to care planning and funding, as well as a range of supportive documents and business development tools to help advisers engage more clients in this area.
Can you tell us what’s happening with social care reform in England?
I’ll only be able to scratch the surface with my answer, but hopefully I will be able to provide a helpful summary to bring anyone who isn’t already, up to date with the key points.
On 7th September 2021, Boris Johnson presented his government’s plan ‘Build Back Better’ to Parliament in respect of Health & Social Care, which included a proposed ‘cap’ on care costs of £86,000, and a planned increase in the capital thresholds up from £14,250 and £23,250 respectively, to £20,000 and 100,000 respectively from October 2023. Unbeknown to many though, the majority of funding to be made available (£36bn across 3 years raised by a new Health & Social Care levy and an equal increase in the rates of dividend tax from April 2022) was to be focused on the NHS and post Covid recovery, and not social care. The Health & Social Care levy was scrapped a mere 6 months after its establishment, announced by Jeremy Hunt in November 2022’s Autumn statement, saving both individuals and employers millions of pounds. The Build Back Better care funding reforms for England whilst fully formulated and resourced were flawed and have now been effectively kicked back into the long grass, possibly to resurface in 2025, to which I am doubtful. The pillar of the deferred reforms – the £86,000 cap – has drawn the majority of media’s attention, but even if this is introduced, analysis has revealed all is not what it seems. A few quick calculations demonstrate that for most people the cap would be irrelevant due to the average time it would take to reach it and the average time people spend for example in residential care. And for those that might have reached the cap, they would have ended up paying considerably more than the £86,000 in the process due to the extent to which elements of ongoing care fees would not have counted towards it – for example, ‘top up’ costs, and the £10,000 per annnum ‘room and board’ referred to as ‘daily living costs’ if the person lived in a care home.
Things are far from simple and there is a growing need for a trusted source of information.
What’s happening in the rest of the UK?
To add to the confusion, Northern Ireland, Scotland and Wales each operate different care systems, and there a growing consensus that these governments also need to change how social care is organised, funded, commissioned, delivered and led.
Irrespective of where advisers are based in the UK, it’s important to get to grips with what’s happening further afield as it’s not uncommon for families to live across borders. You can have an adult child client living in London, with Mum – the person in need of care – based in Edinburgh for example which means the Scottish care system would apply.
In Wales, only a couple of months ago against a growing consensus that the current state of health and social care was not fit for purpose, the Welsh First Minister Mark Drakeford admitted that his government had been waiting to see what happened in respect of a sustainable solution to care in England before deciding on what action to take. At a recent news conference at the Senedd in Cardiff Bay, Drakeford admitted that the UK Government’s latest social care U-turn in respect of its reforms had “strengthened” the case for a much discussed ‘National Care Service’ for the Welsh people. A collaborative effort between Plaid Cymru and Labour could see the creation of a free social care system in Wales by as early as late 2023 to rival the NHS, funded by a tax hike equivalent to between 1% and 3% on income tax.
The Scottish Government have taken a step further than Wales and committed to a timetable to establish a functioning ‘National Care Service’ by the end of this parliamentary term in 2026, having introduced the National Care Service (Scotland) Bill into Holyrood on 20 June last year. More recently, the Scottish government is being urged to put a temporary halt to its plans for a ‘National Care Service’ following the Convention of Scottish Local Authorities (COSLA) voicing concerns that funding would be better made available as funding to frontline services. The discussion continues.
When it comes to Northern Ireland, the state of adult social care is in an even worse position, not made any better by the political situation there. Last January, far-reaching plans to change the face of adult social care in Northern Ireland were tabled by Health Minister Robin Swann when he launched a consultation for reform. A central priority of the plans is to significantly enhance both the amount and the quality of social care services – with a major focus on increasing investment to meet increasing levels of need. Growing the social care workforce and improving its pay, terms and conditions are emphasised as a “lynchpin” of reform. Only time will tell as to how things may evolve.
It’s partly due to the confusion caused by the fragmented nature of the UK’s 4 care systems and the constantly changing landscape that My Care Consultant produces our regular ‘adviser briefings’. These are designed to provide up to date information about important announcements or new white papers in respect of government care reform across the UK, and help advisers stay on top of developments as easily as possible. Our briefings are free and you can sign up to receive these, and our other free resources here.
How can advisers support clients in need of care now?
Whilst it’s disappointing to see yet more government u-turns on proposed social care reform after many decades and numerous political parties kicking it into the long grass creating confusion and concern for many, there is no doubt they provide an opportunity for advisers to open up to their clients and local communities – as they have a significant role as a trusted source of accurate information. Perhaps as part of what may be veiwed as a civic duty, but if ever there is an opportunity to demonstrate to consumers at large that in the main financial advisers are a safe pair of hands, and the unique and often undervalued role they play, then the care reforms are surely it.
Existing clients, if they don’t already, need to fully understand the unique role that qualified financial advisers play in paying for care advice. Our experience is that in the main they don’t and leads to a circular position where some advisers say they don’t have much call for care advice and the statistics suggest a significant number of older family members of their clients are at the same time struggling to meeting a care need.
This is one of the reasons we created Care Box, My Care Consultant’s online technical and business support resource for financial advisers and support staff: Care Box contains lots of marketing support material such as client letter templates and presentation slides that can be top and tailed and used in seminars with clients or corporate connections. It provides a great way to open up conversations and let people know you can help. For a free trial of Care Box, click here – as an Air member you will earn Air Unity Points when you purchase a subscription to Care Box Online.
Isn’t care advice a bit niche though?
Clients need to understand that financial advisers can also help with the unregulated aspects of care advice that sits at the beginning of the advice process and often determines the appropriate nature of regulated care advice (for example eligibility for LA and NHS funding), be that inhouse or outsourced to an independent care navigator like MCC. Again our experience is that far too many clients don’t understand this either. You may well have told them in the past, but when the urgency and stress of an immediate care need surfaces for a family member, often in our experience clients can forget if it is not a key part of your offering and a topic or regular conversation.
Statistically, 50% of us will end up caring for an older person at some point in our lives (if this hasn’t happened already). Half the number of us again will end up seeking formal care for that person, and navigating the complexities of the health & social care system – indeed 80% the enquiries we receive are from the adult children of those already in care. A significant number of us will also end up putting our hands in our pockets to pay towards that care on behalf of our parent/s.
So, in respect of your question: how niche is care advice? The answer is simple: the need for care advice is far from niche, but the provision of it is, although this is starting to change. Lack of access to good advice and an understanding of why it’s so important however remains a significant issue for the majority. Social care across the UK is on its knees due to a combination of an ageing population, lack of government funding that has been ongoing for decades, and structural issues across the sector including workforce vacancies. All of this is resulting in a fast-growing need for a trusted source of information.
Can you explain the link between care advice and consumer duty?
When it comes to non-regulated care advice and its impact on regulated care advice, the imminent Consumer Duty to be introduced in July 2023 has raised the need for all advisers to make sure that they are able to provide access to non-regulated care advice. This is best illustrated by reference to the overarching cross-cutting rules, including the duty to be placed on all financial advisers to avoid causing foreseeable harm to retail customers and the duty to enable and support clients in pursuing their financial objectives.
Now I’m sure you will all be thinking ‘nothing new here Jacqueline, this is what we do’ but I think the word foreseeable is critical here. Let me outline some concerning scenarios that we are increasingly seeing in practice:
- Facilitating a form of Equity Release without exploring how this may impact upon local authority funding or state benefits
- Facilitating an Immediate Needs Annuity or other ways of self-funding care where possible eligibility for free NHS Continuing Health Care (that meets all care needs) has not been fully explored.
- Not checking if a client has previously taken out any insurances that a successful claim against may result in payment of all or some of their care fees.
- Failing to discuss the importance of an LPA when advising on Equity Release to pay for care (in full or in part), resulting in the withdrawal of future drawdown in the event of one or both signatories losing mental capacity.
- Not making clients with a care need aware that when it comes to a financial assessment some local authorities may not apply the statutory guidance accurately.
It depends on the extent to which advisers have or want to develop a level of internal expertise – whether an adviser wants to offer the non-regulated aspects of care advice in house or to outsource. Ignoring it never was a good route to follow but the regulator’s focus on vulnerability and consumer duty has made this a much higher risk strategy. For example, the FCA Final Guidance on the fair treatment of vulnerable customers states that firms should…. “Make consumers aware of support available to them, including relevant options for third party representation and specialist support services”.
Advisers need to consider the information or support needs of any client so they are able to pursue their overall financial objectives. Given the catastrophic cost involved in self-funding care, I would argue this brings care advice into the mainstream of advice that needs to be given regardless of a firm’s area of specialisation.
How can MCC support advisers with clients and older family members in need of care?
Depending on your advice model, you may choose to embrace one of all of the following:
1. Consider referring the ‘non-regulated’ aspects of care advice to an expert
At My Care Consultant our role is to guide clients in understanding, finding and funding their care, so they are aware of the available options and can make decisions from an informed basis. For current clients or family members in need of care now, you may wish to use our ‘care advice referral service’ whereby your clients can book an initial, free introductory call with a MCC care consultant, followed by a choice of optional chargeable services designed to help them navigate their care, and funding needs – we keep you updated through this process and will signpost back to you for financial advice:
2. Upskill so you can be confident holding initial conversations with clients in need of care
We are also the owner and operator of ‘Care Box’, our online technical and business development resource for financial advisers with clients and family members in need of care. Our members use the content in Care Box to keep their knowledge up to date, help prepare for client meetings and grow their care business if they want to. No matter what the specialism, Care Box is designed to help all advisers deliver a successful care advice proposition to clients and family members, no matter where they are living in the UK:
3. Establish an online care advice service for clients
Following a successful pilot, we’re soon to launch our brand new online ‘self-serve’ client resource branded ‘My Care Hub’ for financial advice firms with clients in need of care or those with family members in need. Through My Care Hub, they will have 24/7 access to reliable, up to date information and guidance, and get answers to important questions. They will also have the option to book a 1:1 personalised guidance session with one of our experienced care consultants and enjoy a discount on our open market services.
Email: firstname.lastname@example.org and quote ‘My Care Hub’ to register your interest.
In my opinion care advice presents a key advice opportunity: by seizing control of the situation and planning ahead to ensure your clients and their loved ones get the care they need and deserve, you’re raising the advice ‘bar’ and will stand out against the competition. Ignoring this area of advice was never was a good route to follow but the regulator’s focus on vulnerability and consumer duty has made this a much higher risk strategy.