'Target affluent OAPs to fund NHS'
The rich and middle-aged should be taxed more to pay for the NHS and social care, a new report suggests.
Meanwhile, the elderly should be stripped of their free television licences and the winter fuel payment for older people should only be given to those most in need, experts said.
The new report, by a commission brought together by leading think tank The King's Fund, also suggests that fewer people should be eligible for free prescriptions through the health service.
The commission was tasked with looking for innovative ways to help shape and fund health and social care after The King's Fund identified "huge pressures" facing the care system at a time of growing demand and constrained resources.
The expert panel concluded that h ealth and social care funding in England should be brought together under one ring-fenced budget with funds divided out by a single commissioner.
The Government should assume that by 2025 this combined fund will cost between 11% and 12% of England's economic output - in line with many other countries around the world, they said.
The current system creates "confusion, perverse incentives and much distress for individuals and families" they said as they called for services to be redesigned to create a "simpler path" for people trying to navigate the complex system.
The Commission, led by Dame Kate Barker, said p eople with social care needs deemed to be critical should have free care and as the economy improves it should be extended to include people whose needs are substantial.
The team of experts then made a series of recommendations to fund this system, including increased taxation and changes to benefits.
"We recommend on the grounds of equity, affordability and inter-generational fairness that at least some of the extra revenue to pay for the large-scale improvements that we seek should come from the group that will be among the biggest beneficiaries of the changes, namely the older generation and particularly its more affluent members," their report states.
"Resources can be released by targeting existing benefits ... away from affluent pensioners, and diverting the money into health and social care."
They said that free TV licences for the over-75s and the winter fuel payments should no longer be provided on a universal basis and limited to those who receive pension credit.
When someone reaches the age of 40 their National Insurance contributions should increase by one percentage point to contribute towards health and social care funding, they said.
And people who earn more should also be forced to pay increased contributions, they said.
The report states: "We recommend an additional contribution from the income of the most affluent. At present those above the current upper earnings limit for National Insurance - just under £42,000 a year - cease paying employee National Insurance at the standard rate of 12% per cent. Instead they pay only 2% on earnings above that threshold. We recommend a further one percentage point increase to 3%."
And those who work past the state pension age, who at present are not required to pay National Insurance when they continue to work, should be required to pay reduced rate contributions.
No additional charges should be imposed for NHS services - except for changes to prescription charges and an NHS funding pot for patients discharged from hospitals to nursing homes.
Prescription charges should be reduced to £2.50 instead of the current £8.05 but fewer people should be eligible for free prescriptions, their report states. At present nine in ten prescriptions dished out by pharmacists are given to those who can get them for free - including the elderly, children, pregnant women and some poor people.
Meanwhile, people who receive help the NHS Continuing Healthcare fund should be required to pay their accommodation costs if they can afford it.
In total, the recommended measures would generate around £5 billion, they estimated.
"Our system is not fit to provide the kind of care we need and want," said Dame Kate.
"We propose radical change, greater than any since 1948, that would bring immense benefit to people who fall between the cracks between means-tested social care and a free NHS.
"This includes people at the end of life and those with dementia or other conditions where too often there is a conflict about who pays at the expense of what people need.
"Our proposals would continue a system where costs are shared between the private individual and the state but with the taxpayer carrying a heavier load of that cost than at present. The cost of a more generous settlement, though large, can be afforded if phased in over time."
Professor Chris Ham, chief executive of The King's Fund, said: "The proposals as set out by the Commission may not appeal to politicians, fearful of commitments of greater public expenditure, but these issues cannot simply be ignored.
"The Commission is clear - there is no 'do nothing' option. As the costs of what we now classify as social care grow, these will increasingly fall to individuals and families, creating fear, uncertainty and inequity on a scale that the public would find completely unacceptable if applied to health care. The recommendations are therefore radical - tinkering around the edge of our systems of care is not enough to deal with the challenges we face.
"The issue is not whether health and social care are affordable in future - they have to be paid for one way or another. The issue is how far they are publicly or privately funded and at what level of quality and decency.
"This report lays down a challenge to politicians of all parties to acknowledge the unsustainablity of current funding for health and social care and to set out, ahead of the election, some of the difficult choices that need to be made."
Commenting on the report, Richard Hawkes, chair of the Care and Support Alliance, which represents 75 leading charities including Age UK, Red Cross, Scope and Mind, said: "Population changes mean more and more people need care. Yet fewer and fewer people get it, as chronic underfunding has seen a year-on-year rationing of support.
"The Barker Commission has rightly put the spotlight on how we create a system fit for the 21st Century and come up with realistic proposals for how we can afford it."
A Government spokeswoman said: "We agree that health and social care services should be more joined up - our £3.8 billion Better Care Fund is making this a reality for the first time ever, bringing NHS and social care teams together to help people live independently for as long as possible.
"We are also transforming the way people pay for the care they need, capping the amount they have to pay and providing more financial help.
"We have taken tough economic decisions to support social care services and protect the NHS budget, which we have increased by £12.7 billion since 2010."
Labour's shadow health secretary Andy Burnham said: " We welcome this bold and timely report which endorses Labour's call for a new settlement for the NHS and the full integration of health and social care.
"The stark truth is this: if social care is allowed to continue to collapse, it will drag down the rest of the NHS.
"This is precisely what is happening under this Government, as people who have seen support withdrawn are ending up in A&E in increasing numbers.
"The simple fact is that there is no sustainable future for the NHS in the 21st century without a long-term solution for social care.
"It is only by better supporting people and their carers that we can avoid huge expenditure on avoidable hospital admissions."