When Kate Meacock received a letter from her mother’s care home earlier this year, she knew exactly what to expect.
Once again the home was upping its fees — this time by £500 a month.
It means she is now paying £7,880 per month, a 55 per cent increase on what she originally agreed to seven years ago. ‘I can’t see how this is sustainable,’ says Kate, 52.
Devoted couple: Ivor and Eileen Truman, on their wedding day, now live together in a care home meaning they face double fees which are soaring annually
‘With other bills you can shop around if they go up. But you can’t do that with a care home. It would be too unsettling for mum to move.’
Experts warn that Britain’s social care system is now at breaking point, with residents forced to pay tens of thousands of pounds to keep it together.
The pandemic shone a light on cracks in the industry, prompting the Government to introduce its controversial ‘health and social care levy’ to plug a major funding hole. But the sector now faces a new battle: the cost-of-living crisis.
Just like households across the country, care homes are being hit by soaring energy bills and food prices.
It’s led some to slim down meal sizes, reduce menu options and even cut down on the use of washing machines to slash costs.
An employment crisis in the sector also means providers are having to rapidly increase staff wages. And they are being quoted sky-high insurance bills after the pandemic saw nervous insurers hike premiums.
One care home director told Money Mail the cost of his cover has more than quadrupled in a year. Many providers say they have no choice but to pass on these rising costs.
And families up and down the country have already been hit with big bill hikes this year.
A Facebook group devoted to residents’ relatives, called Rights for Residents, has attracted dozens of posts from members complaining their fees had been increased by hundreds of pounds per month. In some cases it was the second time in a year that the home had hiked fees.
According to the specialist website UK Care Guide, someone in a self-funded care home will see their annual fees increase by between £15,000 and £30,000 over the next three years.
When somebody goes into care, families can access support from their local authority if they have less than £23,250 in savings.
If they have more than that they must cover the cost themselves.
Figures from the Office for National Statistics show that more than 125,000 residents are self-funded — around 35 per cent of the total number of people in care. On average they already pay between £27,000 and £39,000 a year, according to market research provider LaingBuisson.
Diane Mayhew, founder of Rights for Residents, says: ‘In the midst of the cost-of-living crisis it’s understandable homes need to manage their outgoings.
‘However, on top of years of inexplicable fee increases this latest financial burden is too much for families.
Care has been reduced to an ‘industry’ in which our loved ones are referred to as ‘service users’ rather than residents who are paying a handsome fee to live in a place they call home.’
‘I could not believe mum’s bill increase’
Lynne Ellis saw her mother’s care home fees increase by £60 a week in April.
Mum Patricia Laforge, 91, is self-funded though her savings are dwindling fast as she tries to keep up with rising fees.
Lynne Ellis has seen her mother Patricia’s care home fees increase by £60 a week in April
Lynne, 61, from Middlesbrough, says: ‘I could not believe the price increase.
‘The pandemic was absolutely awful and we couldn’t see her for most of lockdown.
So to come out of all that and then be told the home is increasing its fees is just awful.’
‘What are these extra fees even covering?’
Providers say they are on their knees as they try to cope with soaring costs. In the past heating bills typically totalled £1,000 a year per resident but this figure is set to double as wholesale energy prices rise.
Many care homes are older buildings that are not very energy efficient. And strict regulations mean homes must always be above a certain temperature.
But experts say energy bills are a drop in the ocean compared to other costs — most notably, insurance premiums.
In the first four months of the pandemic, there were more than 20,000 Covid-linked deaths in care homes in England and Wales.
Since then insurers have been anxious about a wave of legal claims against homes over the fatalities and have increased their premiums as a result.
Mike Padgham, who runs five homes across Yorkshire and chairs the Independent Care Group, has seen his insurance bill go from £12,000 a year pre-pandemic to £48,000. He says: ‘In my 30 years of running homes I have never seen anything like this.
‘There is a perfect storm of costs facing homes and many will not be able to cope.’
The issue is compounded by a lack of willing care home staff after workers left the sector during the pandemic, complaining they were underpaid and overworked. Others gave up full-time positions in favour of agency work which is typically better paid.
HC-One, one of the country’s largest providers, has already started investing £17 million to pay its workers above the real living wage of £9.90 an hour.
This has put pressure on smaller homes to follow suit. Saq Hussain, who operates the UK Care Guide, says: ‘Staffing is the biggest cost struggle for homes.
‘Some have started to make cut-backs in other areas like slimming down menu options and being stricter with food portions.
Others are having to better plan washing dishes, clothes and bedding and switch machines to eco-mode to reduce electricity bills.’
According to the specialist website UK Care Guide, someone in a self-funded care home will see their annual fees increase by between £15,000 and £30,000 over the next three years
Concerns around social care have been mounting for years but the pandemic pushed them to boiling point.
The Government pledged to solve the crisis by introducing a ‘health and social care levy,’ which increased national insurance contributions for all workers by 1.25 percentage points. And from next April, pensioners who are still working will also have to pay the levy.
National insurance is paid by employees on their wages, employers on behalf of their staff and the self-employed on their profits.
The hike, which has been widely criticised, was partially off-set by an increase in the starting point at which people begin paying the tax.
From next month, employees will pay national insurance on earnings over £12,570 — up from £9,880.
The levy promised to raise £39 billion over three years for health and social care services.
However, only £5.4 billion of the sum has been reserved for social care. What’s more, homes are also having to pay the extra national insurance contributions on their own staff wages.
Caroline Abrahams, Charity Director at Age UK, says: ‘The cost of providing care is going up quickly because of rising prices all round, plus the increase in National Insurance care companies also need to pay.
Smaller, independently run care homes are finding the current climate particularly hard to weather.’
A spokesman for the Department of Health and Social Care says: ‘We are working closely with the adult social care sector to manage pressures and ensure continuity of care amid the rising cost of living.’
Ivor Truman, 92, dutifully decided to move in with his wife Eileen, 96, after she moved to a care home. Eileen suffers from dementia and Ivor wanted to make sure she was properly cared for.
But it means the couple, from Derbyshire, face double care home fees which are soaring annually.
This year, their care bill increased by £250 per month each — £500 in total. Daughter Avril McGowan, 71, says: ‘The costs are just going up and up. But the quality of care is not changing. The food is dreadful and the home cannot seem to keep permanent staff.’
The Government pledged to solve the social care crisis by introducing a ‘health and social care levy,’ which increased national insurance contributions for workers by 1.25 percentage points
Resentment is also growing between self-funded care home residents and those who access support from local authorities.
Councils will help fund residents who have less than £23,250 in savings. Exactly how much the council will pay depends on the type of care needed among other factors.
Residents must undergo a means test which will result in either: the council paying the full cost of care, paying some of the cost while residents ‘top-up’ the remainder or families paying the total bill themselves.
Self-funders and those whose places are paid for by local authorities live side-by-side in the same care homes.
But there is frustration that local authorities are often not paying the ‘true cost’ of social care.
It means others are charged more to plug the gap.
A 2017 audit by the Competition and Markets Authority (CMA) calculated that self-funders paid on average 41 per cent more than local councils for a bed in the same care home.
Mr Hussain, from UK Care Guide, says: ‘If costs keep going up, care homes will either start shutting down because they aren’t economically viable, or they will be forced to say they will only take on self-funders and will not work with local councils because they simply aren’t paying enough.’
Penny Hutchinson and her siblings will have to pay yet more for their mother’s care home after their fees jumped this year.
Their mother Yvonne Williamson, 82, has her care partially paid for by the council and the family top up the rest.
Penny, 54, from West Yorkshire, says: ‘I wouldn’t mind the fees going up if you could see a difference in the quality of care offered to residents.
‘But in my mum’s home the food is getting worse and the garden isn’t even tended to.’
She adds: ‘The real issue is that a lot of these big providers still have bosses on huge wages and they pay a fortune out to their shareholders.’
There are also concerns that the biggest care home providers are keeping bosses on fat-cat salaries while upping fees for residents.
At the end of last year the Daily Mail revealed how Britain’s highest paid care home boss Dr Pete Calveley, pocketed a £250,000 pay rise while planning to increase fees for his homes by nearly 10 per cent.
Dr Calveley, who runs Barchester Healthcare, earned £2.27 million in 2020 — around 130 times more than some of the carers who worked for him at the time.
Barchester said it pays staff more than the living wage and 85 per cent of its services have been rated ‘good’or ‘outstanding’, up 40 per cent since Dr Calveley took over six years ago