Post updated: 20th May 2019. Written by Jane Amanda Flaherty
of the questions I am often asked by clients is whether they should agree to a
third party top up fee on behalf of a loved one? Unfortunately, this isn’t a question you can
answer with a straightforward yes or no. Like most issues relating to later
life matters it is always bespoke to the individual family.
What is a third party top up payment?
A third party top up fee is when a relative or friend enters into an agreement to pay the difference between what the care home costs and the amount paid by the Local Authority. Top ups are the additional costs incurred for ‘preferred’ accommodation (Section 30 of the Care Act 2014) that is over and above the resident’s personal budget.
What are the rules?
Firstly, a resident cannot make the payment out of their own money, the exception being if they have entered into a deferred payment agreement. The top up arrangement needs to be agreed by the Local Authority. Always check that they are aware of the arrangement. If a care home wants you to enter into an agreement directly with them, I would urge caution and recommend that you obtain professional advice before agreeing to signing any such document.
I would advise that you ensure that your agreement is with the Local Authority and that they invoice you directly for the difference. In practice, I have come across some agreements where the Local Authority were not aware of the arrangements. In some cases, the Local Authority decided that the agreement was not legal because they were being asked to pay for extras that actually were considered to be expected, therefore an extra charge could not be added to the cost of the care.
There is no requirement to enter into a third party top up agreement. If the Local Authority cannot find an alternative care home to meet the residents care needs, they have to pay the full price. However, if the resident chooses a different home to what the Local Authority have secured because it is deemed a better home or because its nearer friends or family, the Local Authority do not have a responsibility to pay the difference and that is why top ups are predominantly made.
What do I need to know about the arrangement?
When you enter into a top up agreement you are entering into a contract, my best advice is to read the agreement carefully. If you are not sure about the consequences go and seek independent advice. It is better to get the right advice at the start than to have regret at a later date because your circumstances have changed.
The agreement should tell you the following information:
In practice when the care fees go up following an annual review, they often go up disproportionately. The Local Authority rates may not increase to match the increase in the care fees being charged by the care home. This results in the third party taking the brunt of the care fees increase. Problems normally arise when the third party can no longer afford the payments so it is essential to know what will happen if that circumstance arises and what your contractual obligations will be.
What happens if there is a failing by the Local Authority?
There are a number of remedies available to families if they feel they are wrongly paying for a top fee such as:
If you ask for a copy of the Local Authorities complaints procedure it will advise you of the procedure and when each option is triggered.
Just to give you a flavour for the types of matters that are considered as maladministration. The Ombudsman found that Southampton City Council wrongly charged an elderly woman’s family ‘top-up’ fees for her residential care. She found that in line with Government Guidance “because no accommodation was available at the Council’s ‘usual rate’, the Council should have paid to accommodate the woman elsewhere and should not have sought additional fees beyond the assessed contribution.” The authority was asked to pay back all the top up fees and to fully fund her care, less the resident’s contribution to pay, going forward. https://www.lgo.org.uk/information-centre/news/2012/oct/southampton-council-criticised-over-care-home-top-up-fees
Tameside Metropolitan Council had set a budget for a client and then changed the assessment which meant that the resident had to pay a top up. The ombudsman made recommendations to reimburse the women's estate the full amount of the third-party top-up payments that have been made; provide the son with a full written apology and to review the individual cases of other affected residents and consider whether a similar remedy is appropriate. This applies to all affected residents placed at Auden House and any other care home that have set their fees above the council rates. This applies only to residents placed in care homes prior to the introduction of the Quality Framework. https://www.lgo.org.uk/decisions/adult-care-services/charging/12-019-862.
I understand how daunting the paperwork and forms around care can be and have helped hundreds of clients with their care concerns over the years. If you’re ever faced with paperwork you aren’t sure of, just get in touch with me using the details at the top of this page and I will make sure you’re on the right track in no time.