Care fees – What’s the best option?
Many people are concerned about the cost of potential care home costs for the future. However, the fact is that not every one of us will need to go into a care home. According to Age UK, in 2015, only 4% of the adult population were in care.
A more striking statistic however, is that of those going into care, the average life span is only 15 months. With that in mind, is going into a care home the best option?
The Government is keen to keep the cost of care down. The obvious choice for an elderly person requiring some care is for them to stay in their own home for as long as possible with help and assistance being employed, for example, hiring someone to cook, clean, wash, iron, shop, etc. This is assuming that there isn’t a relative living close by, or a good neighbour, who can assist where required.
However, there will be cases where going into a care home is the only option for an elderly person, for example if their needs are such that they need 24 hour nursing, supervision or assistance. So, what will the elderly person have to pay towards their care costs?
If the local authority are organising your care then they will carry out a care needs assessment to help them identify what care you actually need. Based on this, the local authority will draw up a care plan detailing your care needs and requirements. The local authority will then work out a personal budget to ensure that your care needs and requirements are met. They will then carry out a financial assessment which will determine how much you need to contribute towards your care fees.
The financial assessment will take into account your income and capital, but some things may be partly or fully disregarded, such as your property if this continues to be occupied by a relative over the age of 60, or a child under 18 or a relative who is incapacitated. Any joint assets will be counted as 50% belonging to the person needing care.
Your income will include things like social security benefits, any annuity income, rents, occupational pensions and trust income. However, 50% of any occupational or personal pensions and retirement annuity contracts will be disregarded if you have been paying at least 50% to your spouse or civil partner. Any annuity income payable from a home income plan or payable under a mortgage protection policy will be partly disregarded. If you have income that is frozen abroad i.e. due to a political situation, then this income will be totally disregarded. If you have any unclaimed pensions, then you will be asked to claim these. The surrender value of any life assurance policy or annuity will be disregarded.
Your capital will include things like your house, your savings, your investments and cash. The value of any personal chattels, provided they were not purchased with the intent of depleting capital and paying less in care costs, will be disregarded.
Where a person deliberately deprives themselves of assets by giving them away to avoid paying higher care costs, they will be assessed as still owning the asset.
If you have capital of:
£23,250 plus – you will pay the full cost of your care
£14,250-£23,250 – the cost of your care will be on a sliding scale
£0-£14,250 – you won’t have to pay any costs towards your care
Once the financial assessment has been carried out, the local authority will write to you with a calculation to confirm what your contribution towards the care costs will be, and what the local authority’s contribution towards the care costs will be.
If your capital is above £23,250 at the time of going into care, but starts to depreciate to around that figure over time, then you can request the local authority to carry out another financial assessment for your care costs. This should be done in advance of your capital reaching this limit so the local authority has time to carry out the assessment.
For help and advice in relation to this matter, please contact Maxine Heppenstall via [email protected] or 01943 609969.
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