Planning how to pay for a care home
When moving into, or helping a loved one into a care home, you need to fully understand about costs and affordability, including what the state provides.
Paying for a care home place is often a family concern and it may be essential for everyone involved to have a good understanding of the issues.
Basically, if someone has been assessed as needing a care home place and their capital is below £23,250, they should be entitled to financial support from their local authority. With capital below £14,250 they will be entitled to maximum support but also required to contribute their weekly income during their stay, less £22.30 per week retained for personal expenses. If you have capital between £14,250 and £23,250, you will also pay a capital tariff of £1 per week for each £250 or part thereof between these two figures.
The person has a choice as to which home to be in and this can even be in a different local authority area. The home chosen must be suitable for their assessed needs, and comply with any terms and conditions set by the funding authority. It must not cost any more than they would usually pay for someone with the person’s needs. If the care home place of choice does cost more, the local authority will allow the fees to be topped up by a third party who is able to do so over the long term. The top-up fees are not allowed to come from the person’s own capital if this is below £23,250.
If only one partner in a couple requires care, only that one person should be means tested. Property occupied by their partner is disregarded and only fifty per cent of any private pension should be taken into account. The local authority will take into account 50% of any joint savings. It is then better to make separate arrangements to pay care costs from an account in the name of the person in the care home.
If, apart from your property, your other capital is below £23,250, the local authority will help with the costs during the first twelve weeks of permanent care. Beyond that period, any financial help will be charged against the value of your former home and recovered from the eventual sale proceeds. You don’t have to sell your property – the local authority can lend you the money to pay for your care charged against your property value. However, they may limit how much they will pay and it could adversely affect your welfare benefit entitlements. If you move into a care home and your property is left empty, you should receive full exemption from Council Tax until it’s sold.
If you move into a care home independently and then run out of money, once your capital reduces to £23,250 you can seek local authority assistance. However, if the home costs more than the local authority usually pays and won’t reduce its fees, you could be in the difficult situation of either finding a source of top-up or seeking less expensive accommodation, the move to which could be detrimental to health and well being.
If you are self-funding and there is a likelihood of running out of money, it’s important for you to arrange an assessment of your care needs with the local authority social services department to ensure they will step in to help. Also, check if the care home owner can continue to accommodate you at social services funding rates, or will require a third party top-up. There are ways of meeting care costs for as long as you need care whilst using up only part of your capital. For example, the use of Immediate Need Care Fee Payment Plans can contribute towards capping the cost from the outset, thus enabling an inheritance to be left for the family.
If you are self funding your care because you are not eligible for local authority funding, there are other forms of financial assistance you may be entitled to. Attendance Allowance is a non-means tested, non-taxable allowance, paid at the lower rate of £47.80 per week for those needing care by day or night, and at a higher rate of £71.40 per week for those needing care by day and night. Also, whether your stay is temporary or permanent, if you receive nursing care in a care home, you may be entitled to an NHS Registered Nursing Care Contribution (RNCC) towards the cost of your nursing care. If applicable, an amount of £108.70 per week is paid by the NHS direct to the nursing home as a contribution towards the weekly fees. If your needs are primarily health care needs, you may be entitled to full funding from your local Primary Care Trust (PCT) following an assessment under their continuing care eligibility criteria.