The topic of care fees seems to be a significant area of discussion at the moment, particularly since the proposed government cap that was due to be enforced this year has now been pushed back to 2020. Understanding the legalities of financing care services is the first step in knowing how to answer any difficult questions that arise from residents and their families as a result of this move. And, most importantly, this knowledge will ensure that the business behind a care home continues to run smoothly and generates a healthy profit.
An imperative piece of advice I continue to give to care professionals is to find out who has lasting power of attorney (LPA) over a resident from the moment they enter a care home. That person holds responsibility for all kinds of important decisions, from the individual’s daily routine to managing their bank accounts and other finances. There are various types of power of attorney documents and a person may well have more than one of these in place; as well as appointing multiple people to act on their behalf. Care professionals should find out who this person is and ask to see the paperwork outlining the validity and terms of this power. This will provide much needed clarity on exactly who is responsible for financing the cost of care and how future payments will be made; making this a crucial part of a care home’s induction planning.
At a particular stage, it could well be that there is no power of attorney as the resident has full mental capacity and is confident in their own decision making and ability to handle finances. In these circumstances, I would still encourage the individual to appoint a power of attorney to safeguard against any deterioration of their mental capacity in the future. For instance, I am currently acting as a power of attorney over an elderly lady who is in residential care. This occurred after the care home contacted me and said they were struggling to secure regular payments from the individual or her family. There was no power of attorney in place and the resident’s daughter has an alcohol problem, making her an unreliable option to take on the role. The resident still had full mental capacity and appointed me as her power of attorney, meaning I now have control of bank accounts and, amongst other things, ensuring that the care home is paid on time.
I would advise other care homes to build a relationship with a local solicitor who can offer a similar service as this is has clearly proved to be extremely valuable to both the care home and its residents; ultimately experiencing the added value in choosing a care home that provides solid legal guidance on key issues. We are also able to educate all members of staff in a care home on what makes a valid LPA document and how to discuss this with residents and their families, which is typically free of charge and can be hugely beneficial. If a resident who loses mental capacity while in the care home and they do not have an LPA or family member to assist, the care home should seek the service of a solicitor to refer the case to the Court of Protection. This can be a long process and typically takes at least six months to resolve, meaning the care home could be out of pocket for a worryingly long period. Discussing the issue of power of attorneys as soon as the resident enters a care home and creating a payment plan based on this information guards against this and is a solid method of future-proofing care home income for years to come.
Elaine joined JMW from Brabners Chaffe Street in June 2009 and was promoted to Partner in May 2010. Elaine is a member of the Society of Trusts and Estates Practitioners and the Probate Section of the Law Society. She specialises in advising sports and media personalities on estate planning and SME owners on inheritance tax and succession planning.
