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Written evidence submitted by the Alzheimer’s Society

We thank the Committee for the opportunity to respond to this inquiry and would welcome the opportunity to present oral evidence.

About Alzheimer’s Society

• Alzheimer's Society is the UK's leading support services and research charity for people with dementia and those who care for them. It works across England, Wales and Northern Ireland. The Society provides information and support to people with all forms of dementia and those who care for them through its publications, dementia helplines and local services. It runs quality care services, funds research, advises professionals and campaigns for improved health and social care and greater public awareness and understanding of dementia.

• There are currently 850,000 people living with dementia in the UK, with numbers set to reach more than 1 million by 2021. With no cure in sight for people with dementia, good care is the main form of treatment or support available to them; but a lack of funding means people relying on homecare and care homes too often receive poor or insufficient quality care. This is a symptom of an underfunded social care system that needs to be addressed by Government.

1. What are the funding challenges for local authorities in England, and how can they be overcome?

a)      EVIDENCE OF FUNDING CHALLENGES FOR LOCAL AUTHORITIES

Central government funding to English local authorities fell by almost 50% between 2010/11 and 2017/18[1]. These cuts were implemented while demand for local government services dramatically increased. Social care funding presents the greatest pressure on local government funding[2]. With an estimated 70% of care home residents and 60% of homecare recipients living with some form of the condition[3] people with dementia are affected most dramatically by the cuts to local authority, and in particular, adult social care funding. With one in 10 local authorities already reporting having to use reserves to balance budgets and provide care and support in line with the Care Act, we have significant concerns around the sustainability of the system over the next financial year and beyond.

People with dementia face catastrophic social care costs and extra fees

1. People with dementia face catastrophic costs due to a lack of social care funding and the poor quality of social care services. We estimate typical dementia care costs to be around £100k, although this can be as much as £500k[4]. Our research has found that if people were to save for the cost of their dementia care (at the same rate as their pension), they would have to save for 125 years. This calculation highlights the impossibility for people living with dementia to pay for their own care.
2. People with dementia currently have to pay for the majority of their care through the costly social care system, unlike other health conditions which are funded by the NHS. People affected by dementia are therefore disproportionately affected by the funding challenges of the social care sector. Too often we hear the consequences of inadequate care – our Fix Dementia Care investigation last year revealed people with dementia left in soiled sheets or being left for days without food[5].
3. With numbers of people with dementia set to reach more than 1 million by 2021 and 2 million by 2050. With no cure in sight for people with dementia, good care is the main form of treatment or support available to them; but a lack of funding means people relying on homecare and care homes too often receive poor or insufficient quality care. This is a symptom of an underfunded social care system that needs to be addressed by Government.

Thresholds to social care services have been raised, increasing drastically the level of unmet need for the poorest

1. The Lord Darzi Review of health and care highlighted the difficulty in people accessing social care services. Between 2008 and 2016 the number of people accessing adult social care services dropped by nearly 1/3 as thresholds for accessing adult social care services increased. The report also highlighted the high level of unmet needs reaching 23% and effectively affecting the lowest income segments the most[6]. According to Age UK the number of older people who don’t get care and support has soared to a record high of 1.4 million in 2018[7]. This means that more people who have difficulties with activities of daily living – such as washing, eating or going to the toilet – do not have the support they need. We know 28% of people assessed get no support at all, and another 28% just get information or signposting as a result, which barely covers their initial needs for support[8]. People with dementia need a local government system that can cover their essential costs for care.

Closure of dementia services in the community due to funding cuts, making it harder for people with dementia to live independently in their homes

1. We can also observe a reduction in community services, such as peer-support groups, day care centres, home care, dementia advisor and crucial information services for people with dementia. The key reasons for the decrease in dementia-specific services were local governments’ decisions to either reduce their budget for, or entirely stop funding these services due to financial pressure, leaving many thousands of people living with and affected by dementia without any condition-specific support. People with dementia generally experience poorer quality of care compared to those without the condition. More than a fifth of services that provide dementia care are rated as failing by the Care Quality Commission, a higher proportion than those that don’t[9]. The low quality of social care services and dementia care is due to the cuts to social care funding.

Care provider market risks collapsing due to lack of funding, putting residents at risk

1. A shocking number of care providers cancelled contracts with 95 UK councils, according to a recent BBC investigation because of terms offered that were financially unviable[10]. The investigation found out that one in four of the UK’s home care providers were at risk of insolvency. It has also been reported that one in six care homes risk collapse. This puts thousands of care home residents at risk, being sent to a care home that doesn’t necessarily respond to their needs – a problem we observe very often for people with dementia. We have also seen issues in the homecare market with CQC raising concerns over the viability of Allied Healthcare. It is paramount that steps are put in place so that the people living with dementia affected, and their families, are supported during this very distressing time.

Post-code lottery in relation to access to and quality of care

2. We are concerned about the variability in access to and quality of social care services, effectively putting people with dementia at risk. People with dementia who live in areas that lose out in terms of funding are left with little to no choice in their care due to a dwindling local care market. Furthermore, even where people do meet the strict means test threshold for council funded care, people with dementia face having to pay extortionate top up fees and other unexpected costs that only exacerbate the disproportionate financial burden they currently face. The system is inequitable and must change.

Lack of social care services pushes family carers to the brink of collapse

3. The consequence of the financial pressures on local government and local services means that family carers bear the brunt of the social care funding crisis. The Lord Darzi Review highlights that the level of informal care has increased over the last five years. In 2016, informal care for ill, disabled or older adults totalled 7.9bn hours, equal to over 4 million social care workers working every week of the year and worth £68.3bn[11]. Caring for a person with dementia is very demanding physically, socially and emotionally. 27% of carers of people with dementia reported feeling cut off from society[12]. 61% said their health had deteriorated as a result of caring for a person with dementia and that they felt guilty asking for help for when they feel stress.

A lack of community care is causing unnecessary additional pressure on healthcare services

4. We have seen a stark increase of avoidable A&E admissions (70%) for people with dementia over the last five years[13], costing between £350-400million a year – 50,000 people with dementia were rushed to A&E last year in emergencies that care in the community could have prevented. This increase was much higher for people with dementia than elderly people with other health conditions. People with dementia occupy 25% of hospital beds. We also know that people with dementia stay twice as long in hospital as other patients aged 65 and over. The reasons for late discharges are often related to a lack of social care support in the community. This presents an unnecessary cost to the NHS and one, which importantly can be avoided if social care is appropriately resourced to support people in the community and in their homes.

b)     SUGGESTIONS FOR OVERCOMING THESE FUNDING CHALLENGES

The Government urgently needs to invest more into social care

5. There is a funding gap of £3.56bn by 2024/25[14]. The LGA estimates that a further £5bn by 2024/25 will be needed to provide care and support for all older and working-age people free at point of access[15]. Unless additional funding is found, more people will be denied access to local-authority-funded care, increasing pressure on social care service users and their family carers. The system urgently requires an investment to maintain standards at the same level as today.
6. The Health Foundation and King’s Fund offer several funding options in their most recent publication on social care funding outlining the implications of each option[16]. It is clear that the system is in desperate need of reform, and we hope that the Government’s Green Paper on Social Care will propose a clear solution. If a cap is proposed, then research carried out in partnership with Laing & Buisson highlights the cap must be set below £80k if any meaningful number of people with dementia are to reach the cap. The threshold should be set at £100k or above. Alzheimer’s Society would not support a cap above £80k or a floor below £100k.

End the inequity faced by people with dementia by establishing a Dementia Fund

7. However, some reform options will not appropriately support people with dementia. In comparison to other people accessing social care services, people with dementia are often forced to pay a ‘dementia premium’ of up to 40% more for their care than people without the condition[17]. Dementia is a complex health condition which requires more complex and costly social care services, but it is unfair for people with dementia to be expected to cover higher costs for essential care because of the health condition they have developed, while people who develop other health conditions such as cancer, heart diseases, or diabetes have their care covered for free by the NHS.
8. We call for the establishment of a Dementia Fund by 2024/25, to cover the additional charges for more complex care, such as necessary training, additional staffing or ensuring continuity of care. Alzheimer’s Society believes a Dementia Fund would be a positive step to encouraging preventative care, encouraging people to access care at an earlier point and helping to reduce crises that lead to costly and often devastating hospital admissions.

Implementing a long term, sustainable solution

9. In the longer term, on top of a Dementia Fund, Alzheimer’s Society supports a system that pools the risk of dementia care costs across society, through a form of social insurance.  With one in three people born today predicted to develop dementia it is impossible to tell who will in future require care and support, and with a growing and ageing population it is vital seeds are planted of a new way of approaching care for future generations, providing reassurance to individuals and families. Pooling the risk of social care is therefore the most equitable.
10. Sir Andrew Dilnot called for urgent action on social care funding asking for a tax to provide life-long adult social care[18]. A recent consultation on the LGA Green Paper revealed that the most popular solution for the long term was to introduce national tax rises (either through National Insurance, or income tax rises)[19]. This was seen as progressive, a feasible, realistic and sustainable solution.
11. In polling with YouGov (2018) we found that 54% of adults in England were supportive of increases on income tax for people over 40 if it was spent on dementia care. Alzheimer’s Society would welcome a new approach to taxation or for further exploration of a system of auto-enrolment as suggested by Matt Hancock Secretary of State for Health and Social Care, providing the latter is boosted by financial incentives delivered by Government.
12. Alzheimer’s Society would support this as this would end catastrophic costs and enable the provision of high quality and affordable care in the future to all those who need it. Such a system would guarantee that people with dementia are no longer disadvantaged because of their need for social care support.

Moving investment from secondary healthcare to community and social care services

13. Alongside additional funding for dementia care Alzheimer’s Society also suggests a changing focus of investment from expensive secondary healthcare services to preventative primary care, community care and housing services. Community and housing support can prevent people from ending up in hospital, and help people to leave the hectic environment of A&E wards more promptly. CCG commissioners[20] who have made a shift in their investment approach have seen improved outcomes for patients and an overall cost-reduction across the health and social care system.

2. What lessons can be learnt from other countries, in how they approach social care?

Japan’s long-term care insurance systems

14. Japan’s long-term care insurance model provides also interesting insights for the UK with regards to how they can create a more sustainable and equitable social care system. Japan introduced a long-term care insurance system in 2000 which established an interesting model of funding and delivery. It is funded by social insurance, taxation and individual contributions (known as co-payment)[21]. Half of the funding is generated through taxation, the other half is raised through social insurance premiums. These premiums are distributed according to the level of need, taking into account the age structure of the local populations. When people access social care services they pay 30% of the cost up to a pre-determined monthly cap, although people with very low levels of income are exempt. The government decided not to offer cash-benefits in order to remove the burden of caring from families. When Japan introduced this insurance system it offered generous benefits for people to ensure sign-up. Additionally, this system builds on a pre-existing health-insurance system that people were accustomed to. Importantly, the government reviews the funding model on a three-yearly basis, which enables them to respond to changing needs, but also offers an opportunity to review the funding model.

Germany’s long-term care insurance

1. The German long-term care system also has interesting lessons for the UK. Introduced in 1995 Germany’s long-term care insurance is partly funded by taxation from individuals and employers. For those in work, employers pay half the premium while the retired pay full contributions, thus helping to address inter-generational equity concerns. LTCI membership is compulsory and non-employed people are covered by employed householder insurance contributions. Since its establishment the fund has been in good health, growing its reserve to €8.3bn in 2015 while responding to people’s health and care needs at a higher level than currently here in the UK. The scheme recently made changes to provide better coverage for dementia-specific care given the changing demographic needs[22]. This approach divides responsibility between the state and the individual in a manner which has proved to be politically sustainable; it has provided a sufficient degree of funding whilst containing costs; and it achieves a fairer balance between different generations than funding from general taxation alone would be by including pensioners within its tax base.

We thank the Committee for the opportunity to respond to this inquiry and would welcome the opportunity to present oral evidence.

November 2018

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