How we calculate what you may have to pay towards your care
Adult social care in England is, unlike healthcare, not a free service. Many people will have to pay a contribution towards - or pay the full cost of - their care and support.
We calculate this by getting our financial assessment and welfare benefits team to work with you to look at the details of your savings and other assets as well as your income, (which for certain types of care will include the value of your main home).
We will need to verify these details and will ask to see paperwork such as bank statements.
We may also follow up where it appears that you have given away assets and this has the effect of reducing the amount you pay towards your care. This is called deprivation.
We then apply national rules to see whether we can help with paying for your care and what contribution you might have to pay. It is important that we get the correct information as soon as possible. Any delay can result in you being charged the full cost of your care, although once we get the information we need, we will make any changes to your financial assessment.
These can include:
- the value of your main home (for long-term residential care financial assessments)
- money held in bank, building society and post office accounts including ISAs
- savings certificates, stocks, shares, bonds, unit trusts and premium bonds
- businesses, land or buildings in this country or abroad
- trust funds
Whether you have to pay towards your care because of any savings and other assets you have depends on how much you have and what type of care you will be getting.
Long term residential or nursing care
If you have more than £23,250 in savings and other assets it is unlikely that we can help with funding even if the social worker’s care assessment identifies that your care needs meet the national eligibility criteria. You are what is called a 'self-funder' and are responsible for arranging and paying for your own care.
Please note that if you own your own home, its value will normally be counted as a part of this figure so you are very likely to be a self-funder. It is assumed that you will fund your care by selling your home. The value of your home will only be ignored in certain circumstances (either because you are only going into residential care for a short period of time, or because your partner or other dependent relative is still living in it). However, if we count the value of your home and you are unable or unwilling to sell it, we may be able to assist.
Deferred Payment Agreement
A ‘deferred payment agreement’ is an agreement with us which could help you to use the value of your home to enable you to pay for your residential care costs.
If you are eligible, and the council is able to obtain a first legal charge over the property, the County Council will pay towards your care home fees on your behalf. When you choose to sell your house, or 90 days after your death, the cost of your care home will then be repaid by you, or someone on your behalf. The amount you are assessed as having to pay for your care and support is delayed and not ‘written off’.
The benefits of a deferred payment agreement are:
- That you will not be required to sell your home immediately.
- You could choose to rent out your home and create some income for yourself which would reduce the amount you have to pay us back when the house is sold.
- You might be entitled to claim some benefits which you could use towards your charges. If there is an existing agreement for a third party "top up", where a family member or other person puts additional money towards your placement, and you decide to take advantage of the Deferred Payments Scheme; you can add the cost of the "top up" payments to your Deferred Payments Scheme loan, if the Council agrees there is enough equity in your home.
We would recommend that you obtain independent financial advice before making any decisions.
Care delivered in your own home
If you have more £23,250 in savings and other assets we will not provide any funding towards the cost of your care, even if the social worker’s care assessment identifies that your care needs meet the national eligibility criteria. You are what is called a 'self-funder'. You will either need to arrange your own care, or you can ask us to do so – in this case you will be asked to pay the full cost of the care service you receive plus our administration costs for arranging them.
As we are providing services to you whilst you remain in your own home, the value of your home is not counted when calculating this limit.
If you have savings and other assets below the capital limits described above (£23,250 for long-term residential care or care at home) then you will receive a financial assessment to see how much you can pay towards the cost of your care based on those assets and your income.
- If when we assess you, your savings and other assets are less than £14,250, we will ignore them completely and work out your charge based on your income only.
- If your savings and other assets are between £14,250 and up to and including the capital limits, we will add 'tariff income' to your income, i.e. we will assume an income of £1 a week for every £250 (or part of £250) you have above the £14,250.
When working out your contribution to the cost of your care services, we will look at any income which is in your name. There are national rules about how we treat different types of income. Some is ignored in full or in part.
Income counted in full
This will include:
- benefits (including State Retirement pension)
- any occupational (works) or personal pension you receive
- most annuity incomes
- any 'tariff income' we have calculated based on your savings and other assets
Partly ignored income
National rules require us to ignore a part of some benefits and pensions, including:
- war disablement pension
- war widow’s or widower’s pensions
- the savings credit element of Pension credit
Income we do not include
National rules require us to ignore some types of income when assessing your ability to pay towards the cost of your care services. This includes items such as:
- specialist payments (e.g. Macfarlane Trust payments)
- the mobility components of disability benefits such as Disability Living Allowance or Attendance Allowance
Outgoings and expenses
In certain situations we can make an allowance against your assessed income for particular costs.
Some of these are national allowances for everyday living expenses which everyone gets and which you will automatically be given, such as:
- Personal Expenses Allowance (if you are in long term residential or nursing care)
- Minimum Income Guarantee (for care in your own home)
We may also be able to make allowances for property related expenses to allow you to continue to pay certain costs relating to your main home if you are receiving care in it, or if your stay in residential or nursing care is short-term.
For care in your own home, we may also allow certain disability related expenses if you receive disability benefits. We will automatically allocate you such an allowance based on the level of disability benefit you receive, but if you think that this is not enough to cover your own disability related costs, you can appeal and we will consider a personalised amount where you can provide evidence of the costs.
If you have 'disposed' (i.e. given away or transferred) of savings, capital or income, either directly or via a trust, we may decide that you have done this with the express purpose of avoiding or reducing your contribution to the cost of your care. If we do, we are allowed by law to treat you as still having that asset, which means you could be charged up to the full cost of your care.
We will take into account all the circumstances when deciding whether you have deprived yourself of these assets, and it will be for you to prove that you no longer own the assets and to satisfy us that its disposal was not done to reduce charges.
Disposing of assets can include making large gifts to relatives, or transferring savings or the title deeds of a property to another person or into a trust.
Your assessed weekly contribution and how it is reviewed
After we have completed your financial assessment, we will send you a calculation sheet showing how we have worked out the amount that you need to contribute towards your services.
Your 'maximum weekly contribution' is the sum that we calculate you can afford to pay towards the services you receive each week. However, you may not have to pay this in full if the total weekly cost of the services provided to you is less, in which case you will pay your 'assessed weekly contribution'.
Each year - or at any other time when there is a significant change in your circumstances or the care we provide, - we reassess the amount you will have to pay and let you know of any changes. This is a good time to check that your financial information is correct and up to date. You should let us know of any change in your financial circumstances as it may affect your financial assessment.