CREDIT: This story was first seen in OnMedica
The average annual cost of a care home in Great Britain has jumped by almost 10% over the past year, representing the largest increase on record and nearly double the five per cent increase of the previous 12 months, shows research of 124 homes, carried out by independent provider Prestige Nursing + Care, OnMedica reports.
This takes the average cost of paying for a care home place to an all-time high of just under £34,000, while pensioners’ incomes have remained stagnant.
The latest edition of the six-year study found that the average cost of a care home in Great Britain reached a new high of £33,094 a year in 2017, which is £2,978 more than the £30,926 average recorded in 2016.
While care home costs are rising at a record rate, pensioners have seen their incomes stagnate over the past year. According to data from the Department of Work and Pensions (DWP), the average pensioner income rose by just 0.5% from £14,456 to £14,522 which is well below care home price growth and the current 2.8% rate of inflation.
The growth in care home costs has also outpaced the growth in pensioners’ incomes over a longer period. Since 2012, the cost of the average care home has risen by 23.7% from £27,404, while the average pensioner’s income has risen by 9.9% from £13,208.
This fall in affordability means the shortfall between the annual cost of a care home and pensioners’ incomes has widened substantially.
In the past year, the difference between care home costs and pensioners’ incomes has risen by 17.7%, from £16,470 to £19,382. In total, the annual cost of a care home now equates to 133.5% of the average pensioner’s income.
The East of England tops the league table for the region with the least affordable care homes in the country for the third year running, with a cost-income shortfall of £25,636. It has now also overtaken London as the region with the most expensive care homes in Great Britain.
The East Midlands saw the largest overall increase in the cost of a care home last year, rising 17.7% to £33,956, while the North East still has the most affordable care homes of any region, but still experienced the widest growth in the mismatch between costs and affordability (43.5%).
Yorkshire and the Humber was the only region to see care home affordability improve year-on-year.
Jonathan Bruce, managing director of Prestige Nursing + Care commented: “It is alarming to see care home costs continue to rise so out of sync with pensioners’ incomes. With later life incomes stagnating, the rising cost of care will eat away at a growing number of families’ finances as they use their assets to meet bills for vital support.
“This reinforces the fact that we are facing a serious and prolonged social care crisis. Spiralling costs mean people must talk about how they will fund care for themselves or their loved ones earlier, and avoid being stung.”
He continued: “The enormity of the challenges facing the sector means there is a desperate need for a political solution to the crisis. While fixing social care will not be easy, it can be turned around if policymakers set out a concrete plan that takes into account the need of patients, providers and councils. A freefall in standards across the sector is unacceptable in one of the richest countries in the world.
“While the Brexit negotiations are dominating political discourse at the moment, the upcoming social care green paper offers an opportunity to put things right – hopefully the government will seize it.”
Cllr Izzi Seccombe, who chairs the Local Government Association’s Community Wellbeing Board, said: “We have been warning that adult social care services face an annual £2.3bn funding gap by 2020. As part of this, the care provider market needs an urgent and immediate injection of £1.3bn just to bring much-needed stability.
“We also need fundamental changes to the way we fund adult social care if we are deliver a long-term sustainable system that works for adults of all ages, and provides peace of mind for older people and their families, allowing them to be able to plan ahead for future care costs.”