As we get older, many of us worry about how we will cope with the cost of care for ourselves or our loved ones should we need it.
With people living longer and demands on social care rising, care funding has been a hot topic in recent years. Successive governments have examined the issue to develop plans for how the cost of care can be met.
Social care funding is devolved, with different provision across the UK. In England, it was thrown into the spotlight ahead of the 2017 General Election.
The Conservatives proposed a big change to the way social care is funded, in short a person’s contribution to the costs of care – whether residential or domiciliary – would be determined by a single threshold of £100,000, which includes the value of their home. Once their net assets fall below that level, their care would be paid for by the state. The details of these proposals have, however, yet to be confirmed.
This moves away from the original plan, first proposed in an independent report in 2010, which introduced a lifetime cap on care home costs, and a significant change to the means test. Both of these changes were supposed to be introduced in April 2016, but the government then pushed them back to April 2020.
These original plans are outlined below, but may be subject to change.
The lifetime cap
According to the earlier accepted proposals, a lifetime cap of £72,000 would be introduced in 2020, meaning that once this amount has been spent, you will not be obliged to pay any more for your care. The cap would apply whether you are receiving care in your own home, or in a care home. The cap does not include expenses incurred in a care home (bed and board), these are charged separately even after reaching the cap, but they will also be capped at £12,000 per year.
The means test is when your assets are assessed by your local council to decide how much you should contribute towards your own care. The current situation is as follows.
- If you have more than £23,250, you have to fund your own care.
- If you have between £14,250 and £23,250, your local council will contribute towards your care (until your assets are reduced to £14,250).
- If you have less than £14,250, your care will be fully funded.
The 2020 changes proposed that:
- The £23,250 upper limit will be raised to £118,000 – so you only have to fund the full cost of your own care if you have more than £118,000.
- The lower limit will be raised to £17,000 – therefore if you have assets between £17,000 and £118,000 you will be entitled to some financial support towards your care costs, and if you have less than £17,000 your care will be fully funded.
Currently, and as in the 2020 changes, the means test may take into account the value of your home, but it won’t be counted if you only need temporary or short-term care, or if it is occupied by your partner or former partner, children under 18, a relative over 60 or a disabled relative.
People living in residential care can ask their local authority to pay their bill and recover the money from the sale of their family home after they die.
The latest Conservative plan would extend this right to those receiving care in their own homes, who would have to pay until they were down to their last £100,000.
Care funding in other parts of the UK
The above changes apply specifically to England: the maximum amount you have to pay towards your care is different in other parts of the UK. More information is available at gov.wales, online.hscni.net/ and www.scotland.gov.uk
Also see ‘Care costs in Northern Ireland’