Care Funding

Care costs within a care home environment vary hugely ranging from £40,000 to £120,000 per year depending upon the level and complexity of care, type of care required and the type of accommodation chosen.  The level of these costs will obviously have a huge impact on a person’s wealth and this is a concern for many people requiring care and for their families. It is essential that advice is sought at the earliest possible opportunity so that families have time to make the right choices for their particular circumstances. 

In broad terms there are three ways to fund a person’s care in a care placement.  These are detailed below:

• Self funding

• Local Authority funding

• NHS Continuing Healthcare funding

1. Self funding

The majority of people who are currently residing in residential or nursing care pay for the care and accommodation themselves.  Many people find themselves in this position because the assets that they own, for example, property and monies held in bank accounts or investments have a value of more than £23,250.  If a person owns assessed assets below this value, they can expect the Local Authority to assist with the funding.. However, there are certain types of assets which the Local Authority is not permitted to take into account when carrying out this type of financial assessment.  Sometimes this will mean that people fall within the self funding regime when actually some contribution ought to be being made by the Local Authority.  Often people within the self funding regime are never re-assessed and therefore never have an opportunity to review whether they ought to be assisted financially by either the Local Authority or by the NHS.  (care-funding article - preservation of wealth)

2. Local Authority Assistance/Funding

Where a person’s assessable assets fall below the figure of £23,250, the Local Authority will step in to assist with funding.  As mentioned above, in dealing with this calculation there are certain assets that cannot be taken into account by the Local Authority and it is essential that advice is taken as to what should or should not be declared so that this calculation can be undertaken correctly.  Most people incorrectly assume that the Local Authority will simply fund the cost of their care once their capital assets have fallen below this limit.  This is not the case.  In dealing with their calculation the Local Authority will fix a maximum amount that they would be willing to fund for a particular room in a particular care home.  This is not often in line with what the care home will be charging for that particular room. 

For example:

This £200.00 difference between what the care home expects to be paid and what the Local Authority has set as its limit will need to be paid by a third party (often the resident’s family) and is not permitted to be funded by the resident personally. This is to ensure that families who wish for their relative to reisde in a more luxurious or costly care home, are able to do so, without the Local Authority being liable for the additional 'hotel' costs.

In the calculation shown above the Local Authority’s maximum payment is then further split.  The resident will be entitled to retain a small living allowance of approximately £25 per week but all other income will be used toward the cost of care.  The resident will be expected to pay all the income they receive (including state pension, private pension etc.) as the ‘Resident’s Contribution’. The Local Authority will then pay the difference between that resident’s contribution and the maximum amount that the Local Authority feel that the room is worth (in our example £650.00).

As you can see often this means that the Local Authority contributes a relatively minor sum in comparison to the resident and the third party.  Clearly assessments will not always be as simple in practice and can often involve complex calculations and exemptions which are not readily explained.  Advice should be sought at the earliest opportunity and this is usually when the resident or their family are presented with a Financial Assessment to complete.

The new Care Bill came into effect in part from April 2016 however the changes in relation to the way that the calculations of a person’s finances and contributions toward the cost of their care will be made has been shelved indefinitely.

A fully funded solution to care costs - or is it?

3. NHS Continuing Healthcare funding.

The third possibility is often over looked once the Local Authority have decided that a person’s finances are such that they will be Self Funding. This option is where the funding for a person’s care is met by the NHS.  This is called Continuing Health Care.  This type of funding is completely non-means tested and no financial assessment will be undertaken.  When assessing whether a person would qualify for Continuing Healthcare, the only criteria that is relevant is the person’s health/care needs.  Where it is decided that somebody’s primary needs are medical rather than social needs, the NHS will fully fund a care placement.  Often, it is difficult to differentiate between what is medical and what is simply a need for assistance by a trained care worker.  In order to assess whether needs are predominantly medical rather than social care a brief assessment is made (checklist) and if the person is shown to have a certain level of needs, a full CHC assessment is undertaken.  During this assessment, a wide range of ‘domains’ (areas of need) are reviewed.  Assessments are usually lengthy and can be complex often dealing with medical issues which are outside the family’s understanding.  It is crucial that all aspects of a person’s health needs are raised and taken into account appropriately at this meeting and that the best possible case is made for your relative. 

How can Sydney Mitchell help you?

• We will be able to provide guidance and advice, often at a time of crisis for you and your family.

• We will be able to assess your current situation and steer you through the maze of conflicting information you are likely to be receiving.

• We can provide clarity and peace of mind by representing you / your relative at assessments and providing support and guidance for you throughout the complex and often stressful process.

• Ensuring that you or your relative’s case is put forward in the best way possible to ensure they receive any funding to which they may be entitled.

A video explaining NHS Continuing Healthcare funding

This information is available in the Sydney Mitchell publication "Care Funding"