Cash strapped councils will increasingly shunt costs for long-term care to users and the NHS, according to Laing & Buisson.
The market analyst's annual review of the UK elderly care market also suggests that demands on councils will increase by 1.5% a year despite £2bn of additional funding.
It believes the public sector will continue its long term withdrawal from provision, and says the number of older residents in private and voluntary homes is projected to grow by 4.4% from 382,000 in 2010 to 399,000 in 2015.
During this time, an overall increase of just 1.4% from 418,000 to 424,000 is expected.
The report reveals that 40% of care home residents across the UK are private payers, 52% are funded by councils and a growing 8% are funded by the NHS, although as many as 28% of council funded residents are ‘quasi' private payers, by virtue of being in receipt of 3rd party top-ups.
William Laing, author of the report, is concerned by the budget shortfall and suggests councils will have to find other ways to fund there long term care provision.
"The government made a special case for social care in the spending review with the £2bn that might have been cut from councils' social care spending being made up - in theory at least - by earmarking £1bn from the NHS budget for social care purposes plus an extra £1.1bn in central government grants for social care," he said.
"But not all this money may reach social care and even if it were to do so councils would still be faced with extra demand from the ageing population, which we estimate at about 1.5% per year.
"So social services will still face extreme financial pressure, and so too will private and voluntary care home and home care providers which derive over half of their revenue from councils.
"Overall, we think that cost shunting to both service users and the NHS will become the order of the day for many financially stressed councils," he added.
Laing also warned that councils may ration access to services even more than they do now, though three-quarters of authorities already restrict services to people with ‘substantial' or ‘critcal' needs only.
And this could even lead to the closure or sale of all council run care homes.
