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CHAPTER 6 EXPERIENCE OF THE APPLICATION PROCESS (DEFERRED PAYMENT AGREEMENTS AND CHARGING ORDERS)
Introduction
6.1 An important part of the research was to ascertain residents' views on their experience of applying to defer payments for the cost of a care home place, either through a DPA or a Charging Order. The following section contains the findings on this issue. To supplement the views of care home residents and their relatives, the research also sought the views of local authority representatives in terms of their experience of setting up deferred payment arrangements with residents, either through a DPA or a Charging Order. Finally, this section also considers the views of the community based older people on which, if any, of the current requirements involved in setting up a DPA they found to be off-putting.
Local authority perspective: experience of DPAs
6.2 As previously noted in the report, only 4 of the 14 local authorities interviewed as part of the research had actually set up a DPA. Because all parties were relatively unfamiliar with the process, each of the 4 councils said that the time taken to set up a DPA can be quite prolonged. In one case this took almost 2 years to complete. The main explanation for the lengthy set up time was the lack of knowledge of DPAs among clients' lawyers and the constant need to refer clients' lawyers to the relevant guidance and legislation surrounding DPAs. Most local authority representatives thought that the DPA process should be relatively straightforward and able to be executed in 3 to 4 weeks.
6.3 Each of the 4 local authorities who have set up DPAs reported some teething troubles in establishing a draft DPA agreement. In drafting this agreement some councils sought the assistance of other councils who already had a draft in place. Some councils also developed measures to make the process more straightforward for residents, including the development of a booklet to provide more information about DPAs, and a change in practice whereby residents would liaise directly with the finance section within social work services, rather than front-line social work staff. One local authority representative believed that these measures would prevent situations where the resident is not informed about DPAs at all, or is not given the correct information about the process of setting up a DPA (see Chapter 4).
6.4 However, irrespective of the above actions by local authorities, interviewees reported that interaction with clients' lawyers to set up the DPAs could be lengthy, considerably delaying the process from initial enquiry about a DPA to a DPA being established.
6.5 In addition to the teething problems reported with establishing a draft DPA and the length of time it could take to set up an individual DPA, several local authorities raised some issues about the guidance provided for implementing and maintaining DPAs. For example, the guidance on the maintenance and upkeep of the property does not, it was argued, provide an explanation of what to do in circumstances where the property is not being insured and maintained as per the agreement. Two local authorities said that they did not know what action they could take if a client's family did not adequately insure or maintain the property, although both noted that thus far no one had defaulted in this manner. Another local authority said that the guidance produced by the Scottish Executive provided little information in terms of what to do in a case, which they had recently faced, in which a client who had established a DPA had left the care home and returned home. The local authority representative revealed that the client, faced with quarterly statements about his accruing debt, decided to go home rather than stay in the care home and face rising debts.
6.6 For the few DPAs that had actually ended, local authorities reported no difficulties in terms of recouping the outstanding fees when the properties were sold.
6.7 As well as discussing experiences where DPAs had been established, the research interviews also found that not all DPA applications could be successfully processed. An important factor here was the capacity of the care home resident and the existence of power of attorney arrangements. The fact that a DPA is based on a 2 party agreement means that residents must have the required capacity to enter into the agreement or someone must have power of attorney to do so on their behalf. One authority in particular reported that the absence of power of attorney arrangements had been an issue in 10 cases, which had subsequently resulted in the use of Charging Order arrangements instead.
Local authority perspective: experience of Charging Orders
6.8 As none of the other local authorities in the research had set up a DPA, representatives were asked instead about their experience of placing a Charging Order on a resident's property. Most of the representatives reported Charging Orders to be relatively quick to execute, and straightforward from the resident's perspective. The process involves confirming ownership of the property and then registering an interest with the Registers of Sasines. The use of Charging Orders was found to be particularly useful in cases when the client has no power of attorney to represent them.
6.9 Local authorities need to gauge a current value of the property to ensure it will cover the anticipated debt. Authorities employed a range of tactics including the use of internet sites to establish the price of similar properties that had been sold in the area, and using council tax bands to estimate likely value. Local authority representatives said that Charging Orders were relatively inexpensive to administer. Estimates of between £35 and £100 were offered. Some local authorities absorbed these costs; others charged the cost to the resident when they recouped the outstanding care home costs.
6.10 Each of the local authorities that operated a Charging Order regime said that once the Charging Order had been registered, a letter would be sent to the resident to inform them of this. This letter would also advise of the weekly amount that was being deferred. Despite this, one of the relatives that we spoke to said that she did not receive such a letter, and was completely unaware that a Charging Order had been placed on her mother's property.
6.11 One relative who took part in the research project said that she found the need to confirm ownership with the Registers of Sasines to be an offensive aspect of the process. She was not aware that undertaking a search of this kind was a routine part of the process, and was perplexed when she received a letter to say that the local authority's search of the Land Register confirmed that her father did in fact hold the deeds to the property. As the interviewee had never denied this, she could not understand why the local authority had had to carry out the search. She felt that the local authority had not trusted her or the information she had given to them. Had the local authority given her more detailed information about what was involved in the process of setting up a Charging Order, then perhaps this ill-feeling could have been avoided.
The resident and relative perspective: experience of DPAs and Charging Orders
6.12 In terms of the experience of residents' representatives, the report presents 3 case studies in Appendix 1 of the report. The studies are typical of the feedback received during the research from those who had attempted to set up an arrangement for deferring care home fees for their relative. The 3 case studies provide an example of a participant who managed to successfully conclude a DPA (Case Study 1), a participant who attempted unsuccessfully to defer payments for her mother's care home fees via a DPA (Case Study 2) and, finally, one woman who thought she had a DPA in place, but, in fact, has had a Charging Order placed on her mother's property (Case Study 3). The case studies provide participant feedback on the following issues:
- How informed they were about care home fees and the options available, prior to their relative needing care
- The circumstances surrounding their relative requiring a care home place
- The level of information they received from the local authority about the options available
- How helpful the local authority was after initial contact had been made
- Whether they were successful at securing an arrangement that would allow them to defer care home fees
- The length of time taken to finalise the arrangement
- The level of costs involved in setting up the arrangement
- How the process could be improved for others
6.13 Of the 3 case studies presented, the most satisfied by the whole process was Ms. C in the third case study whose application to defer her relative's care home fees had resulted in an arrangement based on a Charging Order. She was more than content with all aspects relating to setting up the arrangement as well as the outcome. Her one issue of complaint was the lack of follow-up information giving details of the debt as it accrued.
6.14 While Mr. A, in Case Study 1, was extremely satisfied with the outcome that the DPA had achieved, he had found the time taken to finalise the agreement lengthy, and the paperwork involved potentially off-putting for many families. Another participant who had also set up a DPA confirmed this particular drawback of the application process. Mr. A also noted the cost involved and the need to employ a solicitor as potential drawbacks to the process.
6.15 Least satisfied by far was Ms. B in Case Study 2 who enquired about setting up a DPA but was put off by local authority staff who presented a negative picture of the option, and provided apparently inaccurate information about the process. In this case, the local authority placed a Charging Order on the property which would have allowed her the breathing space she desired, before having to sell on her mother's property, but Ms. B appeared to be unaware that the council had done so. Ms. B's perception was that the local authority had failed to inform her about this.
6.16 Based on the feedback received from all the relatives who took part in the research, there is clearly scope for improving various aspects of the application process, whether this is for a DPA, or to arrange to defer care home payments through the use of a Charging Order.
The older people in the community perspective
6.17 The 2 focus groups with community-based older people sought to gather views on various aspects relating to the application process for a DPA, and to explore with them which, if any, of the current requirements they found to be off-putting. In particular, the focus groups sought to explore participants' attitudes towards each of the following:
- Engaging a solicitor to enable them to defer paying for care home costs
- Paying to set up an arrangement to defer paying for care home costs
- Local authority responsibility for setting up the arrangement
- Filling in forms and gathering a large amount of information as part of the process.
6.18 Participants said that they would be willing and happy to engage a solicitor to act on their behalf, although they did note that the costs of doing so might be unaffordable. Whilst many of the participants who took part in the groups said that they would be willing to pay up to £1,000 if it meant that they could retain their properties rather than sell when they moved into a care home, they did note that this level of fees would be prohibitive to many older persons. They thought that it was important that the level of fees involved should not exclude groups of older persons from being able to take advantage of deferring their care home costs. One participant did note that, if there was a standard contract already drawn up, then the solicitor's fees involved would be minimal, and fewer older persons would be excluded from the process.
6.19 Several of the participants said that they would find a lengthy application form to be off-putting. Some had had experience of filling in lengthy application forms for various benefits, only to find out that they were not entitled. Others said that they would persevere with a lengthy application form in order to secure the deferred arrangement, especially if assistance was available from an officer from the local authority.
6.20 Despite concerns about lengthy application forms for the resident, participants were nonetheless not keen on the idea of the local authority being responsible for the whole arrangement. Several of the participants had had negative experiences in their dealings with the local council, and were not confident that the council would set up an arrangement for deferred payment in a competent manner. It is, however, worth noting that the nature of DPAs, based on a "2 party agreement", ensures that care home residents (or their relatives) are involved in setting up such an arrangement. In contrast, local authorities have responsibility for setting up Charging Orders without involvement of the other party. However, the research found that, in practice, arrangements based on a Charging Order are generally set up with the knowledge of the care home resident or their relative in response to a request to defer payment (although Case Study 2 is an example of where this was not the case). Thus, while these concerns of older people need to be acknowledged, they may not be a major issue regardless of which procedure local authorities use to defer payment, as long as good practice is followed in terms of informing and involving people in the process.
6.21 Whatever process was in place, the participants stressed the need for this to be as straightforward and easy as possible, so that older persons and their families were not put off from applying in the first place. Furthermore, participants thought that any associated costs should be kept to a minimum to ensure that it was not prohibitive to some groups of older people.
Summary
6.22 Section 6 above and Appendix 1 have shown that the few participants who took part in the research who had actually set up a DPA were very satisfied with the outcome, although they did note some issues in terms of the process of setting up the DPA. Most satisfied with their experience, however, were participants who had set up a deferred arrangement through a Charging Order.
6.23 Despite this, the Charging Order regime operated by local authorities was not without its difficulties. However, the provision of more information about the processes involved in the local authority setting up a Charging Order, and improved communication during the establishment and duration of the Charging Order arrangement would perhaps alleviate these difficulties.
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