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Paying for Care
Paying for Care

Social Care – Lifetime cap on care fees

"We need reform and change"

Around 950,000 adults in England receive some form of long-term social care support, which is focused on enabling a sustained and independent quality of life and to protect individuals and families against unpredictable and potentially catastrophic care costs

Since 1998, there have been 12 green and white papers, countless consultations and five independent commissions on Adult Social Care. The Care Act 2014 was implemented in 2015 and intended to modernise Social Care and it raised hopes, pressure and expectation but brought little change.

In a statement made on 7/9/21 Boris Johnson vowed to end “catastrophic costs” for social care users in England with long-awaited reform proposals. The prime minister announced the plans to MPs alongside money to help the tackle pressures on the NHS caused by the COVID – 19 pandemic with the policy paper Build Back Better (updated 19th Nov 2021)

What is the Lifetime Cap on care fees?

“From October 2023, no eligible person starting adult social care will have to pay more than £86,000 for personal care over their lifetime”.  

In practice this doesn’t mean that when you have paid £86’000 towards the cost of your care the Local Authority will take over! A Care Account will not simply add up the fees a ‘self-funder’ is paying under a private agreement with their chosen care provider as the amount included in a financial assessment will be based on the Personal Budget or ‘Independent Personal Budget’ (the amount that the Local Authority can buy the agreed care for). The need must be agreed by a Local Authority and only the amount contributed by an individual will count NOT a Local Authority contribution.  Amendment clause 49 passed 22/11/21.

The cap will not cover the daily living costs (DLCs) for people in care homes, and people will remain responsible for their daily living costs throughout their care journey, including after they reach the cap. For simplicity, these costs will be set at a national, notional amount of £200 per week.

Will care I am paying for now count?

No, any care costs being paid for now will NOT count towards the Lifetime cap of care as the proposed cap will not be backdated and does not commence until Oct 2023 

How do I start a Lifetime Cap on Care Fees?

You can’t start a ‘Care Account’ yet as the Care Cap will begin from Oct 2023 BUT it may still be worth contacting your Local Authority for a Care Needs and/or Carers Assessment.

Health and Social Care Levy

National Insurance contributions will increase by 1.25% from April 2022

A Health and Social Care Levy is expected to raise £36bn over 3 years, with hypothocated levy for Health and Social Care reform, to be distributed UK wide. £5.3billion of £36billion raised in the first three years (2022/23-2024/25) will go on social care. Much of the rest will go on helping the NHS recover from massive COVID – 19 pressures and backlogs.

Build Back Better Summary

A lifetime cap on social care (England) of £86’000 will be implemented from Oct 2023

Local Authority charging capital limits will change from:

Lower Capital Limit – currently £14’250 to £20’000 

Upper Capital Limit – currently £23’250 to £100’000

Tarrif Income – People will be expected to contribute towards the cost of their care from their income, but if that is not sufficient, they will contribute no more than 20 per cent of their chargeable assets per year.

Property Disregards – If a person needs to continue to live in their own home, it will be excluded from the assessment of total chargeable assets. This is known as the housing disregard and is unchanged from the current rules. It is yet to be announced whether the current ‘Property Disregards’ will remain completely unchanged.

MIG and PEA – Minimum Income Guarantee (MIG) for those receiving care in their own homes and Personal Expenses Allowance (PEA) for care home residents, will both rise in line with inflation from April 2022

Asking the Local Authority to arrange care

Currently the Local Authority can arrange care at home for anyone who requests it, regardless of funding status. Section 18(3) of the Care Act 2014 is likely to be actioned in full, requiring councils to arrange care in a care home for those self-funders with eligible needs who request that they do so.

This is likely to have a significant impact on providers, many of whom rely on using higher self-funder fees to cross-subsidise the costs of state-funded residents. However, the government said the £5.4bn package included money for councils to move towards paying a “fair rate for care”, suggesting it expects local authorities to increase the fees they pay care homes

Discharge to assess

Separately, the government announced £5.4bn yesterday to support the NHS’s Covid-19 response for the next six months, which includes £478m to support hospital discharge.

Updated Policy Nov 2021 – The government has provided a national discharge fund, via the NHS, for quarters 3 and 4 of 2021 to 2022 (1 October 2021 to 31 March 2022), alongside existing Local Authority and Clinical Commissioning Group (CCG) budgets, to cover the cost of post-discharge recovery and support for the new or additional care needs of an individual following discharge from hospital. Therefore, an individual’s new or extended care needs will be supported on discharge from hospital and delivered free for a time-limited period. This will enable time for reablement, for assessment and, if needed, for the person to make decisions about their longer-term care and support. The scheme will end on 31 March 2022 and will not fund care delivered after this date. Consequently, no costs for care delivered in 2022 to 2023 will be funded by this scheme.

Wider Social Care Reforms

It is widely acknowledged that the care system is complex and hard to navigate. We are please to see the commitment to improve information for service users to help them navigate the care system and understand the options available to them and are here to help

White Paper – People at the heart of care 

Nicola Taylor
Author: Nicola Taylor

Nik is an experienced Care Funding and Benefit adviser and trainer. She has been helping people navigate the care and benefit maze for many years and is dedicated to supporting people to make good care choices and care funding decisions. The Author of several books, she has worked for Local and Central Government and supports both advisers and private clients with care funding and benefits advice and Care Navigator Reports.

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