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Paying for Care
Working out how much you or relative might have to pay if someone needs to go into care can be daunting. The care system is complex and varies according to where you live in the UK. The first step is to understand which broad category you are likely to belong to; Social Care, Medical Care or Self-Funder. Read below to find out the specifics.
Contact
Social Care (Local Authority)
If you require some form of social care either at home or in a care home and you have assets below the £23,250 upper limit then you could be eligible for some form of Local Authority support.
Local Authority funding
If you need care at home or in a residential care home, the Local Authority can help with your care costs if you satisfy strict criteria about your financial situation and health. Social care funding by a Local Authority is subject to eligibility criteria based on the level of care need required, as well as being a means tested State Benefit.
How much the Local Authority will pay towards the costs of your care will depend on the care assessment and the means test.
Local Authority capital limits
If your financial assets (based on the current rules) including property have a total value of:
Less than £14,250 - you will qualify for full Local Authority funding
More than £23,250 - you will normally have to pay for your own care in full
Between £14,250 and £23,250 - you will receive some Local Authority contribution*
Note: limits on Local Authority funding vary depending on which part of the UK you live.
Appealing
Depending upon your financial circumstances, you may have to contribute towards care home fees. Your local council will work out how much you may have to pay by doing a financial assessment.
Many people are motivated to transfer assets because they fear that they will have to sell a home to pay for care and wish to protect their family's inheritance. There is no foolproof way of avoiding the value of assets being taken into account for means testing. In most cases, the intention behind making gifts of assets is the most important factor. If a local authority believes that an asset has been given away with the intention of creating or increasing entitlement to means tested benefits, it may decide that the donor has notional capital of equivalent value to that of the asset given away.
For those who cannot afford the standard charge for care, local authorities will make an assessment of your ability to pay. This is reviewed annually, though a reassessment can be requested at any time.
Medical/Nursing Care (NHS)
In some situations the NHS is responsible for meeting care needs. This is usually when a person's need is mainly for healthcare rather than social care. NHS care can be provided in hospital but it could be in someone’s own home or elsewhere in the community. When care is provided through the NHS there is no financial assessment and no care charges to pay; however, people are only eligible for NHS care in certain circumstances.
Nursing care
If someone goes into a residential care home but needs some element of nursing care, they’ll get a payment from the NHS to help pay for their nursing care. This is called a Registered Nursing Care Contribution (RNCC) .
Your needs will be assessed to decide if you're eligible for NHS funded nursing care. You should receive it if you live in a care home registered to provide nursing care, and you don’t qualify for NHS Continuing Healthcare but have been assessed as needing care from a registered nurse. The NHS will make a payment directly to the care home to fund care from registered nurses who are usually employed by the care home.
Continuing Healthcare
If the person you care for has very severe and complex health needs, they may qualify for NHS Continuing Healthcare. This is an ongoing package of care that’s fully funded by the NHS.
Continuing Healthcare is fully funded NHS care for those who are severely ill. If your health needs are great, then you may receive NHS Continuing Healthcare. In this case, all care costs are met by the NHS. You may also be reassessed for NHS Continuing Care if your health deteriorates. Find out more
Immediate Care
S117 Aftercare
Social Care (Self-Funder)
If you require some form of social care either at home or in a care home and you have assets above the £23,250 upper limit then you are classed as a Self-Funder.
Options
Self-funding care is a complex matter that requires specialist advice. Carepal has vast experience at handling these cases and no two are the same.
We always recommend that people start the process with our Care Funding Review which runs detailed financial scenarios alonside the specific care needs of the person requiring care.
Care Annuities
If you need to go into care now or in the near future, you may wish to consider an Immediate Needs Annuity. With this type of care funding annuity, payments from the plan to you or your care provider start immediately and continue for the rest of your life. In the event of death early into the care plan, the income payments you receive may be less than you invested. The level of payment from the plan depends on a number of factors such as life expectancy and the level of interest rates in the economy.
A care plan will guarantee a specific level of income to help pay for care fees for the rest of the individual’s life. The cost will depend on:
- The health of the individual
- The age of the individual
- The cost of the care home fees
Key features
- Can be index-linked
- Optional money-back guarantee
- Optional Capital Protection
- Tax efficient
- IHT Planning