Paying for a care home
Almost all people needing support in a care home will be expected to pay something towards the costs of their accommodation and personal care. How much they pay will depend on their financial situation.
Your local council may be able to assist in funding your care in a care home. This will depend on whether the council agrees that you need such a high level of care following an assessment of your needs, and will also depend on an assessment of your financial circumstances to find out how much, if any, the council should be paying towards the cost of the care.
This financial assessment, or 'means test', is based on nationally set guidelines and looks at how much income and capital (savings, assets and property) you have.
If you have over a certain amount in savings (a figure set by the government) you will probably be required to pay for the full costs of your care for as long as your savings remain above this amount. If you have less than this amount in savings you may be entitled to financial help.
If you own a property, its value may be taken into account when the council works out how much you should pay towards your care home or you can make an agreement that will allow you to pay for some or all of your care costs at a later date. This is called a deferred payment scheme and you can find more details about it below.
There are some circumstances, when other people are also living in your home, when the value of the property will be ignored during the financial assessment. If you own a property it is always sensible to seek independent financial advice about how best to pay for your long-term care costs.
If you are eligible for nursing home care then you may be eligible for some of the cost of the care to paid for by the NHS - see 'Exemptions' below.
Your local council will provide full details of what to expect, and how your contribution will be decided, when you complete the financial assessment.
There will be much greater changes to how councils will charge people for care and support from 2020 - you can find out more from the government's fact sheet on Funding Reform. Please note that the document states the changes will be from April 2016 but this has been delayed by the government to 2020.
A DPA is an arrangement whereby you agree with your local council that you will pay for some or all of your care costs at a later date.
This means that the council will not force you to sell your home during your lifetime to pay care bills.
And you can delay repaying the council until you choose to sell your home, or until after your death.
Hammersmith & Fulham, Kensington and Chelsea and Westminster councils have all offered DPAs to residents for some time, but the Care Act means that from April 2015 all councils will need to consider such an agreement when helping someone to arrange care and support.
DPAs will not suit everyone's circumstances - you should be eligible for a DPA if you:
- are receiving care in a care home, or you will be moving into one soon;
- own your own home (unless your partner or certain others live there); OR
- have savings and investments of less than £23,250 (not including the value of your home or your pension pot).
If you need care in a care home, but your spouse / civil partner lives in your home, then the council will disregard the value of the property from your financial assessment.
Use the Deferred Payment Agreement Calculator
As part of helping to understand what your options are for paying for care, a DPA calculator has been developed by local authorities with the Department of Health. The tool explains what a deferred payment agreement is, whether or not it would be an option available to you, and how much it would cost.
Try the DPA calculator here (please note that although the calculator is headed with the Hammersmith & Fulham logo, it applies to Kensington and Chelsea and Westminster residents too)
Find out more about DPAs on our page on Deferred Payments And Paying For Care Homes - Changes Under the Care Act.
If your former home is included in the means test but your other capital is less then £23,250, and your income is not enough to meet the care home fees, the council will help with the cost during the first twelve weeks of permanent care (as if you were council funded),or until the property sells, if sooner.
A 'third-party top-up' is the arrangement where a willing relative or other person is able to contribute towards your care home costs to top up the amount the council will pay, if they have agreed to, towards the cost of your care home.
This will allow you greater choice of where you can live and doesn't affect whether the council will agree to pay towards a care home placement for you or not.
Some people prefer to make their own arrangements for moving to a care home, particularly if they already know that their financial circumstances mean that they will not be eligible for any financial support from their local council. The advantage of this is that you have more choice and flexibility, and can decide for yourself which care home you would like to move into.
However, if you make arrangements for your own care, you will usually have to pay the full costs. These costs are likely to be higher than for care arrangements made by the local authority, as the local authority will usually pay lower rates to the care providers.
If you will not be receiving support from your local council towards the costs of your care home then you will be entitled to continue to claim Attendance Allowance or Disability Allowance, and to use this towards the costs of the care.
Regardless of your financial circumstances you may not have to pay towards the costs of your care if you are eligible for NHS continuing healthcare, in which case all of the costs will be met by the NHS.
If you require nursing care in a care home then the NHS-funded nursing care component is also funded by the NHS, even if you do not qualify for support with the rest of your nursing care costs from your local council.
You may also not need to pay for your care if you have previously been detained in hospital under Section 117 of the Mental Health Act.
And you will not need to pay for your care if you suffer from Creuzfeldt Jacob Disease (CJD).
Many people who need to move to a care home wll find that they are also struggling to safely look after their finances without help from others. If you think you need help to look after money matters then you can find out more about your options in our section on Looking after someone's affairs.
Westminster, Hammersmith & Fulham and Kensington and Chelsea councils have jointly produced a leaflet called 'Paying for Staying in a care home'. You can download the leaflet here:
- If you live in Hammersmith & Fulham
- If you live in Kensington and Chelsea
- If you live in Westminster
If you want to discuss your current care home charges, or to ask for more information on the financial assessment process, then you can contact your council's finance / charging team as follows:-
- To speak to someone about Assessed charges contact:
Address: Charging Team to residential and Home care Financial Assessment Team, 12th Floor West, City Hall, London, SW1E 6QP
Tel: 0207 641 2820.
- To speak someone about invoices contact:
Address : Income collection Team, 16th Floor, City Hall, London SW1E 6QP
Tel: 0207 641 8978
Email : email@example.com
Kensington and Chelsea
Address: Adult Social Care Finance, 3rd Floor Purple Zone, Kensington Town Hall, London, W8 7NX
Tel: 020 7361 2324
Hammersmith and Fulham
Address: The Charging Team, Adult Social Care, Floor 4 - Hammersmith Town Hall Extension, King Street, Hammersmith, London, W6 9JU
Tel: 020 8748 3020 - extensions 1928, 5044, 5430
Age UK has factsheets and information on meeting the costs of a care home, and what to expect when you move there. The financial information in these factsheets applies regardless of your age.
The Independent Age website produces two guides:-
The Housing Care website provides advice on paying for a care home.
The Money Advice Service offers advice on all aspects of paying for care and support.
The Which website offers advice on your options for paying for the costs of a care home.
The Society of Later Life Advisers (SOLLA) provide a database of financial advisors who specialise in giving advice on finances in later life, enabling you to plan ahead or to make the most of your money once you reach retirement and older age. All advisors on the database have to prove that they meet appropriate criteria and have the right qualifications before they are accredited by SOLLA.