Cap on Care Fees – Regulations Revealed

A cap on care fees will be introduced in April 2016 under the new Care Act .

In readiness, draft regulations and guidance have been published to allow time for consultations to take place before next April.

The regulations provide for a cap of £72,000 in relation to the care fees a person will have to pay. Unfortunately, that doesn’t actually mean that no one will ever pay more than that amount for their care.

Care Act 2014

How will the care fees cap work?

At the moment if a person has assets of less than £23,250 they are eligible for some financial support from their local authority.

When their assets fall below £14,250 they are only required to contribute what they can afford from their income to help to pay for their care and that amount is worked out by the local authority as part of their means testing assessment.

Under the new regulations people with assets of less than £72,000 will get financial support from their local authority to pay for the cost of what is called their “eligible support needs”. People will still be expected to pay for their own daily living costs.

People living in care homes will be expected to pay a notional amount of £230 per week for their daily living costs even when their assets fall below £72,000. They will also remain responsible for any top up payments they have agreed to pay, for example if they live in special types of accommodation.

 Proposals for a ‘care account’

The draft regulations propose that local authorities will set up care accounts for each person receiving care support. The local authority will track the financial situation of each individual as they move closer to their care costs cap. It will be the local authority’s responsibility to inform a person when they have reached their care cap.

But the care cap will not start to accumulate until such time, if any, that a person’s care needs have been assessed as being  substantial or critical. Anyone whose needs do not fall into those assessment categories will not have their accumulated care costs  applied and will effectively have no care cap on their assets.

Before April 2016 local authorities will begin to identify people who currently pay for their own care although any care costs incurred before April 2016 will not count towards the £72,000 cap. This process will probably begin in October 2015.

We’ve produced a handy little infographic as a reminder of the essential capital limits that are likely to apply post 1 April 2016. Invalid download ID.

For answers to questions on care fees funding and care contracts, practical support and to keep up to date with developments in social care and later life planning join BE My Own Lawyer for FREE.

For personal assistance with challenging a care assessment or means testing issues contact us.

Disclaimer: Figures contained in this article may be subject to change. This article does not constitute legal advice. Although every effort is made to ensure the accuracy of the information contained in our blog articles at the date of publication no liability is accepted by the author or Barker Evans Private Client Law for any loss suffered as a result of any action taken or not taken in reliance on the material displayed here.