Adult Social Care Funding Models

There appears to be universal agreement that the current system for funding and accessing adult social care in England is inequitable, confusing, complex and unsustainable. It is also widely agreed that the system needs to be addressed to help people currently in the system and needs to be reformed in the long-term so that the future funding of social care in the UK is sustainable for younger generations.

Overview

The UK faces an ageing population that is living longer but not necessarily living longer more healthily; equally the number of dependents relying on a shrinking workforce and tax-base has meant a whole system reform and broader vision for social care is needed. The areas of most contention are the precise structures and outcomes that are most desired for the social care system and how these outcomes are to be funded, as there is currently an estimated £6bn funding gap over the next 20 years. There are tensions between;

• State vs. personal responsibility
• Low/high income, asset rich/poor
• Private/social insurance
• Working/retired population
• Short-term/long-term solutions

Ultimately most social care funding models advocate mixed funding mechanisms and shared responsibility along continuums. This brief will present current social care funding models advocated by different UK stakeholders under themed funding model types which follow;

1. General Taxation
2. Pension Funds
3. Partnership/Co-payment Models
4. Social Insurance Model
5. National Care Fund Models
6. Short-term Funding moves

Please find a detailed explanation in the briefing on UK Stakeholder Funding Models Opens in a new window.

Examples from other countries

Key to all debates in developed countries is how to pay for an appropriate range of long term care services and how to sustain the availability of services in the face of growing demands and diminishing revenue. When questions of access, equality, standards and coverage of care are central - governments have moved to encouraging preventative measures such as promoting healthy ageing, delaying disability, increasing familial support and increasing services in homes and communities.

Many developed countries share similar situations and aims with respect to the delivery and financing of long-term care. Many are also facing demographic imperatives that have forced them to reconsider their social care systems to provide for their ageing populations. Italy, Greece, Sweden and Japan topped the list of countries with the oldest populations in 2000 - each with 17% or more of its population age 65 or over. 16% of the population of the UK in 2006 were over the age of 65. Common country aims in service delivery include;

• Choice and independence through consumer directed home care and the personalisation
• of budgets and services.
• Greater access to services in the home and the community.
• Support for family and other caregivers.
• Integration of health, social and housing services.

In the funding arena an increasing number of countries have moved to providing universal coverage for long-term care through a mix of public and private finance sources. As a general overview Austria, Japan, Germany and the Netherlands are among those that have established universal long-term care programs that provide benefits to all eligible individuals regardless of income. All of these countries have had to increase resources, allocating funding at the national level so access is not determined by local priorities. As a general rule the funding structures require taxpayers to make regular, mostly income related contributions that are not tied to benefit use, which disperses risk and responsibility more broadly across a population.

This briefing details social care funding models and experiences from other countries to place in context proposed approaches to social care funding from the government and other UK stakeholders and organisations. To read the briefing click here Opens in a new window.