Adult Social Care
It is important to understand that Health and Social Care are not the same thing. Healthcare is provided free by the NHS for a health or nursing need and Social Care is assessed by the Local Authority (otherwise known as the Council, Social Services, Adult Social Care) and means tested.
Adult social care refers to a system of support to maintain and promote the independence and well-being of disabled adults and informal carers and is usually means tested, although there are some things the Local Authority must provide free of charge.
Only after a care needs assessment from your Local Authority, can a financial means test assess your income, savings and property to work out what will be disregarded and how much (if anything) you have to pay for your care and support. These assessments are FREE.
There are services that the Council must provide free of charge including the assessments, safeguarding services and some short- term support but usually the person requiring ongoing care will need a financial assessment and be required to make a contribution if they can afford to.
The Care Act 2014 is the legal framework for Social Care in England. It is supported by the Care and Support Regulations and Statutory Guidance which came into force on 1st April 2015.
National criteria for assessing care and support needs were introduced under the Care Act 2014. A care needs assessment (and an assessment of a Carers needs) are free of charge, regardless of who is paying for the care.
Once assessed with an eligible care need a financial assessment will determine any client and/or Local Authority contribution.
A Local Authority has the discretion to choose whether or not to charge following a care needs assessment but apart from some services which must be provided for free, ongoing Adult Social Care (unlike NHS services) is usually means tested. When a Local Authority charges for care and support services they must follow the Care and Support (Charging and Assessment of Resources) regulations and have regard to the Care and Support Statutory Guidance.
Personal Budget/Direct Payments
The care and support planning process will determine what type of care will best suit the person’s needs and how those needs are being or to be met. The personal budget is the cost to the local authority of meeting the person’s needs and not necessarily the actual cost of privately arranged care and support. For people who are not ‘self-funding’ their care, a Personal Budget may be paid as a Direct Payment to enable choice of provider rather than a service that is commissioned by the Local Authority.
The following rules apply to financial assessments for both residential care and care at home;
Residents with over £23,250 savings/capital will meet the full costs of their care and are considered able to pay for their own care in full.
Residents with between £14,250 and £23,250 will make a contribution from their savings/capital as a tariff income of £1.00 for every £250 or part of, a contribution from income will also be assessed
Residents with Savings/Capital below £14,250 will not make a contribution from capital, but a contribution from income will be assessed.
Remember it is an individual’s care need being assessed and so an individual’s ability to contribute towards the cost that will be financially assessed, any joint savings will be halved during a financial assessment (unless an unequal share is clear)
If you would like help to understand what Capital will be disregarded from a financial assessment please make an appointment for a Care Funding and Benefit Check
Only the income of the cared for person can be taken into account during a financial assessment. If you receive income as one of a couple, it is usually assumed that the care for person has an equal share (savings Income will always be talen into account unless specifically disregarded for example earnings or the mobility component of Disability Living Allowance or Personal Independence Payment.
Local Authority Charging and Pensions
If you choose to withdraw funds from your pension pot and manage it directly, for example combining it with other assets rather than through a pensions product, this may be treated as capital under the rules in Annex B.
What is a SIPP?
A self-invested personal pension (SIPP) is the name given to the type of UK government-approved personal pension scheme which allows individuals to make their own investment decisions from the full range of investments approved by HM Revenue and Customs
Annuity and pension income
While the capital is disregarded, any income from an annuity must be taken fully into account except where it is:
- (a) purchased with a loan secured on the person’s main or only home
- (b) a gallantry award such as the Victoria Cross Annuity or George Cross Annuity
Reforms to defined contribution pensions came into effect from April 2015. The aim of the reforms is to provide people who are over 55 years old with much greater flexibility
The rules for how to assess pension income for the purposes of charging are:
(b) if a person is only drawing a minimal income, or choosing not to draw income, then a local authority can apply notional income. This must be the maximum income that could be drawn under an annuity product. If applying maximum notional income, any actual income should be disregarded to avoid double counting
(c) if a person is drawing down an income that is higher than the maximum available under an annuity product, the actual income that is being drawn down should be taken into account
Care At Home
Because a person who receives care and support outside a care home will need to pay their daily living costs charging rules ensure they have enough money to meet these costs. For care at home, after charging a person must be left with the appropriate Minimum Income Guarantee (MIG).
The value of the person’s main or only home must be disregarded where the person is receiving care in a setting that is not a care home or where the person no longer occupies the property but it is occupied in part or whole as their main or only home by a relative or member of the person’s family who is aged 60 or over or disabled. The mandatory disregard only applies where the property has been continuously occupied since before the person went into a care home and is not applicable in your circumstances.
Care in a Care/Nursing home
You will retain a Personal Expenses Allowance, currently £25.65 per week. If the Local Authority allows you to defer paying for your care against the value of a property, used as security (Deferred Payment Agreement), you may keep up to £144 per week. Please ask us to explain these rules to you as they do not apply to everyone who owns a house.
Occupational Pension income
Where a person is in a care home and has a spouse or civil partner who is not living in the same care home and is paying half of the value of their occupational pension, personal pension or retirement annuity to their spouse or civil partner, the local authority must disregard this payment
12 Week Property Disregard
A local authority must therefore disregard the value of a person’s main or only home for 12 weeks in the following circumstances:
(a) when they first enter a care home as a permanent resident
(b) when a property disregard other than the 12-week property disregard unexpectedly ends because the qualifying relative has died or moved into a care home
Deferred Payment Agreement
A Deferred Payment Agreement is an arrangement with the local authority that enables a person to defer or delay paying some or all of the cost of their care until a later date. It is a way to prevent people from having to sell their home in their lifetime to meet the cost of their care. A charge is paced upon the property, interest is charged and an administration fee may also apply.
A Local Authority is required to offer a Deferred Payment Agreement, if a person meets all three of the following criteria at the point of applying:
- If they have been assessed by the Local Authority as having eligible needs that need to be met in a care/nursing home
- Anyone who has less than (or equal to) £23,250 in assets excluding the value of their home
- Anyone whose home is not disregarded for the purposes of the charging assessment
They are also encouraged to offer the scheme more widely to anyone they feel would benefit who does not fully meet the criteria.
Government plans to introduce a new £86,000 cap on the amount anyone in England will have to spend on their personal care over their lifetime have been deleayed until 2025. The cap would apply irrespective of a person’s age or income and be implemented under the Care Act 2014.
Only money spent on meeting a person’s personal care needs would count towards the cap. Spending on daily living costs (commonly referred to as “hotel costs” in a care home) is not included. The Government has said daily living costs will be set at a notional level of £200 per week at 2021/22 prices.
The cap will not apply retrospectively (ie costs accrued before will not count towards the cap).
If you are not sure how these changes may affect how you pay for care and support please ask us for advice or a Care Funding and Benefit check.
If you spend or give away an asset or do not claim an income or benefit entitlement available to you and the Local Authority and/or DWP decide that this was done with a deliberate intention to avoid paying for your care or access a benefit entitlement then they may treat you as still owning or having it and the financial assessment can include the amount as notional income/capital.
If you would like some help to understand how a Local Authority assessment works, how they can help or charge for care please get in touch.
The simple answer is why are you intending to make the gift? If it is to avoid paying for care then that asset may still be included in a financial assessment and you may be treated as a self-funder. If you would like some help to understand the Local Authority Charging system please get in touch
If you are making a trust specifically to avoid paying for care then that asset may still be included in a financial assessment and you may be treated as a 'self-funder'. The Local Authority have 'Deprivation of Asset' rules which may or may not apply to a gift, depending on the type of asset, timing and intent of the gift. Please get in touch if you would like to understand how this may affect you.
Often a property will be disregarded from a financial assessment and it is important to get advice before selling your main or only asset. Please get in touch if you would like to understand your Care and Housing options.
If you don't agree with a decision the first action would be to ask them to look at the decision again. Get as much evidence as possible (and relevant) and if you would like some advice before challenging a decision please get in touch
Social Care applies throughout the UK, the main differences are how you are assessed as eligible and how much any responsible authority will contribute.
In England, Wales and Scotland it is the Local Authority that is responsible for 'Social Care' . The funding levels are different but all will require an assessment of eligible care needs.
|14’250 - £23’250||£18'000 - £28’750
Free personal and nursing care for those assessed with eligible needs
In Scotland permanent care costs are split into Care, Nursing and Hotel costs. The Hotel cost is means tested.
£50'000 (Residential care)
£100 cap for Domiciliary care
|£14’250 - £23’250|