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Care home prices rise to double pension income

Care home prices rise to double pension income

The average bill for an elderly person in a care home is now double the average pensioner income, new research has found
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The average bill for an elderly person in a care home is now double the average pensioner income, new research has found.

The average annual bill for a room in a care home now exceeds £29,000, a 2.5% price increase compared to £27,404 in 2012. This is more than double the average pensioner income, leaving a shortfall of £290 a week or £15,089 a year, new research from Prestige Nursing + Care has found.

Care home costs for the elderly has grown faster than house prices in the east of England, south west and London, the researchers found.

Reflecting on the findings, Jonathan Bruce, managing director of the care agency, said: “Care home prices are rising faster than ever, outstripping the rate of increase in pensioner incomes for the first time in three years.

“This is particularly concerning in light of the decision to defer the Care Cap until 2020. It means more people needing residential care will have to bear the brunt of higher costs themselves, especially as council cuts to care continue to impact eligibility for financial support,” he added.

Last week, the government announced that the cap on care costs will be delayed until April 2020, four years later than the original 2016 date, so from then the amount you pay for care if you are over 65 is being capped at £72,000.

Yet, to be eligible, you first need to be assessed by your council as having very high needs and it is estimated that only one-in-eight people will reach the cap, mainly because people do not live long enough in care homes to accrue such spending on care.

The north east is the only region that saw the average cost of a care home fall over the last year (down by 1.7% to £24,232), and the north west was the region to see the biggest reduction in the care cost vs income gap, which fell by 5.1%.

However, even baring this in mind, pensioners in the north west still face a shortfall of £12,480 if they have to pay for residential care.

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