If you’ve watched the news in the last couple of days you will no doubt have seen that the House of Commons are debating the proposed upcoming Health and Social Care Bill. This has been divisive for a number of reasons, and puts forward sweeping reforms to the way Care is to be provided, including amongst other things, an overhaul of the way social care is to be funded.
When the changes to the charging model for adult social care in England were first announced, Stuart Maher looked at the proposals and provided a summary of these and what they would likely mean for individuals.
The debate and commons vote follows the government publishing further details surrounding the proposed reforms: –
Lifetime Cap on Care Charges – Not Inclusive of Living Costs
As expected there will include a lifetime cap on the charges for personal care, covering adults of all ages. This cap will mean the amount anyone within England will need to spend on their personal care over their lifetime from October 2023 onwards will be set at £86,000.
However, as Stuart predicted, this new cap does not cover the costs of ordinary living costs of residents of care homes, leaving people with these additional costs throughout their lives. Such living costs, however, will be set at £200 per week for those in care homes throughout England, representing the costs of accommodation, food and utility bills that would have to be paid regardless of whether the person is a care home resident or not.
If you are in any way concerned about the impact the costs of future care fees could have on your assets, we cannot stress enough how important it is to seek professional advice.
Means Tested Support – Asset Limit Changes
As was previously announced, the asset limits bounding means tested support will change, the lower limit – below which people will not have to pay for anything for their care from their assets -increasing from £14,250 to £20,000, and the upper limit – above which people lose all financial support from their local authority – rising from the current amount of £20,000 to £100,000. This means those with less than £100,000 of chargeable assets will never contribute more than 20% of those, per year, regardless of the circumstances surrounding how the assets are received.
However, also as Stuart predicted, the partial support provided for those with assets between £20,000 and £100,000 will be tariff-led in the same way as the current system. Specifically, they will have to pay a calculated contribution from their assets dependent on their household situation/income.
This will be £1 per week for every £250 of capital between the two limits and means many will still be required to use significant proportions of their assets to cover their care costs, as much as £320 per week on top for those at the higher end of the threshold.
Where means tested support is provided, only the amount contributed by the individual will count towards £86,000 cap. A ‘care account’ will be introduced for each individual, which will be maintained by the local authorities, keeping track of their progress towards the cap.
Again, If you are in any way concerned about the impact the costs of future care fees could have on your assets, we cannot stress enough how important it is to seek professional advice.
A Choice of Care Provision for Self Funders
There will be changes to enable self-funders to request that local authority commissions their residential care. Previously this was only eligible for domiciliary care.
This means people self-funding their care will be able to pay extra for a preferred care home of their choice or ‘premium room’, although any such additional payments will not count towards the cap and will still be payable by the person once the cap has been reached.
Whilst the proposed changes passed last night’s vote, they are still yet to be approved by parliament. If they are approved, associated regulations and guidance are expected early next year.
We’ve Got Your Back
As stated already, If you are in any way concerned about the impact the costs of future care fees could have on your assets, we cannot stress enough how important it is to seek professional advice.
There are many ways in which you can protect your assets against the cost of future care fees, and our experts are able to look at your individual circumstances and identify tailored solutions to do just this.
If you need such advice, speak to us today. Call Stuart on 01254 88 08 34, email firstname.lastname@example.org, talk to us via live chat or alternatively complete our Contact Us form and one of our expert advisors will be in touch.