The current English system requires anyone with capital of over £23,250 to fund all their care costs – ‘self-funding. The value of an individual’s home is generally counted towards the capital means test unless it is occupied by a partner, dependant, or relative aged at least 60. The new rules raise the cap for full fee payment to £100,000, compared with the £118,000 proposed alongside the Care Act 2014.
At the lower end of the capital means test, there is currently no requirement to use any savings to help meet care fees if wealth is below £14,250 (although there may still be an income-based means-tested contribution). This limit will rise to £20,000.
Between the upper and lower capital limits there is currently an ‘income tariff’ contribution of £1 a week for each £250 (or part thereof) of capital above £14,250, an effective rate of 20.8%. The new regime will continue to have an income tariff between the new limits of £20,000 and £100,000. The government’s paper says that this will be levied at “no more than 20 per cent”, which points to little if any change. At worst, it implies a contribution of £16,000 a year for someone with capital just below the new £100,000 ceiling.
NHS-funded Nursing Care (FNC)
Currently, the individual’s care/nursing home is directly paid £187.60 a week to meet the cost of care from registered nurses. This is not means-tested and it appears that this payment will continue after October 2023. Full care costs are met under the NHS Continuing Healthcare (CHC) provisions, but these set highly restricted circumstances for payment.
Total fees cap
Currently, there is no direct cap on the total amount that an individual can be required to pay for their care. For those entering care from October 2023, there will be a new fee cap, set at £86,000 initially (against £72,000 envisaged alongside the Care Act 2014). The cap will only apply to the costs of personal care, not accommodation charges (sometimes referred to as ‘hotel’ costs).
The Care Act 2014 based the personal care cost ceiling on the fees that would be paid by the relevant local authority, which are typically much less than self-funders are charged by their care providers. The government says existing Care Act legislation will be used to “ensure that self-funders are able to ask their Local Authority to arrange their care for them so that they can find better value care”. Quite what this will mean in practice is unclear – to date care providers have used self-funders to subsidise the fees charged to local authorities.