It’s a widely disliked system but has proved remarkably difficult to change.

Policy and Reform Minister Chris Thomas accepts the challenges ahead in reforming the unfair model of paying for nursing and residential care.

His report to next week’s Tynwald sitting sets out the complexities of reform and outlines six options for consideration.

Since the withdrawal of state-provided long-term nursing care, there has been a widening gap between charges for residential and nursing home care. Private nursing homes are able to charge what the market will bear.

The report to Tynwald notes: ’Many people are fearful of the costs which they may incur in paying for residential and nursing care.

’There is a perception there is a lack of fairness in the use of a person’s capital to pay for care. There is also a strong perceived right to inherit.’

Of the six options outlined in the CoMin report, one is ruled out straight away. Modifying the existing system by changing threshold levels for capital and maximum weekly amounts allowed is deemed not to provide a suitable long-term solution, notes the report.

A second option would be a ’threshold and cap’ model, where the government sets a basic threshold for capital above which a person would be expected to pay their care costs up to a maximum cap.

The UK Conservative Party is proposing a threshold of £100,000 and a cap of about £75,000.

This would mean no-one would be required to pay more than £75,000 towards their lifetime care costs and all would be able to pass on at least £100,000 to their heirs.

The report notes that given the small size of the local market, a lower threshold and higher cap may be required.

An alternative to the ’threshold and cap’ model is the ’personal asset protection guarantee’.

This model essentially generates a ’personal’ threshold and cap of 73/27% so that a person with £200,000 in reckonable capital assets would pay to an effective cap of £54,000 before they were able to access government support.

A fourth option is the Scottish model where free personal care has been provided since 2002 to anyone over the age of 65 on the basis of need, regardless of their level of income or savings.

This would be significantly more expensive than the present system. In Scotland there is a shortfall of between £40m and £60m a year.

And when this policy was rolled out, the number of people receiving personal care spiralled. Spending increased by some 160% between 2003 and 2011 while the over-65 population only rose by about 9%.

A hypothecated tax or social insurance model is another option. This would establish a single dedicated tax designed to fund social care services.

But a significant proportion of these contributions will be drawn from wage earners to support a generation considered by them to be ’better off’.

Finally, there is a mixed model as adopted by Jersey that protects assets (particularly housing) while reflecting a realistic expectation of private payment and supporting those who cannot afford to pay.

The scheme’s main objective is to provide financial support to those who have long term care needs.

Benefit is available to meet costs of care once they have paid costs up to a certain cap level. There is means tested financial support available to help meet care and living costs in a care home.

And financial support is available to homeowners facing high care bills through a property loan secured against a family home.

The report recommends that detailed modelling of a new system for the Isle of Man will be carried out based on the Jersey and asset protection guarantee models, ahead of a public consultation to be carried out next year.