If you’re considering residential care for your loved ones, or for yourself, it’s essential to stay informed about recent reforms that can impact how you pay for care, especially if you are eligible for local authority funding. The UK government’s 2021 Vision for Adult Social Care introduced significant changes to the social care system, including the introduction of a new £86,000 cap on the amount spent on personal care. This care home fees cap was expected to come into effect in October 2023, however, the Government has now delayed this and it is expected to be introduced in October 2025.
In this guide, we’ll explain in simple terms what the care home fees cap is, how it will affect you, and what it means for your or your loved one’s care.
What is the Care Home Fees Cap?
The care home fees cap sets a limit on the amount of money individuals need to spend on their eligible care and support needs. This capping of care home fees specifically applies to the costs related to personal care. As of 2025, the cap will be set at £86,000. This means that after this date, individuals will not be required to pay more than £86,000 for personal care to meet their eligible needs. It’s essential to note that this cap will be applicable to adults of all ages without any exceptions.
Extended Means Test and Financial Support
Alongside the introduction of the care home fees cap, the reforms also include changes to the means test for financial support. The means test determines the amount an individual can contribute towards their care based on their assets and income. To provide more assistance to people with the costs of their care, the government is increasing the point at which an individual is eligible for local authority means-tested support. From October 2023, the upper capital limit (UCL) will rise to £100,000 from the current £23,250, and the lower capital limit (LCL) will increase to £20,000 from £14,250. The UCL of £100,000 will be universally applicable, regardless of an individual’s care setting or circumstances.
How the Cap Progresses and Care Accounts
Starting from October 2023, anyone assessed by a local authority as having eligible care and support needs will begin to progress towards the cap. It’s important to note that costs accrued before this date will not count towards the cap. To facilitate this process, each individual will have a personalised care account to monitor their progress towards the care home fees cap. For those already receiving care, local authorities will identify eligible individuals, ensuring they can start progressing towards the cap from October 2025.
Understanding Personal Budgets and Independent Personal Budgets
For individuals with eligible needs, the local authority must provide either a personal budget or an independent personal budget (IPB). A personal budget outlines the cost to the local authority of the care arranged on the individual’s behalf, while an IPB details what it would have cost the local authority to meet the person’s needs. It’s worth noting that self-funders can also request their local authority to arrange their care, similar to those who are supported by the means test.
What Counts Towards the Care Home Fees Cap?
Care and support costs that count towards the cap are the costs of any provision that helps meet eligible needs as defined under the Care Act 2014. Local authorities will assess the person’s care and support needs to determine the agreed provision. For instance, if someone’s needs are best met in a care home, certain costs, known as Daily Living Costs (DLCs), will not count towards the cap. DLCs are the proportion of residential care fees not directly linked to personal care and will remain the responsibility of the individual throughout their care journey.
Planning for Reaching the Cap
Upon reaching the care home fees cap, the local authority becomes responsible for meeting the individual’s eligible care and support needs and covering the costs for this care. To ensure a smooth transition to local authority support, individuals will be notified in advance of reaching the cap, and arrangements for their needs will be discussed. Options include receiving a direct payment to continue arranging their care or having the local authority assume responsibility for arranging their care and support.
Stay Informed and Seek Guidance
As the level of the cap, capital limits, and DLCs will be reviewed and updated annually, it’s crucial to stay informed about any changes that may impact your loved one’s care. Seeking guidance from care home providers can also help you understand the best options for financing their care. If you would like to learn more about it, more details and helpful case studies are available to read on the gov.uk website.
B&M Care are Here to Support you with Understanding the Care Home Fees Cap
At B&M Care, we understand that these reforms can be overwhelming, but we’re here to help you navigate the changes and ensure the best care for your loved ones.
Our care homes offer compassionate and high-quality care, and we’ll work with you to find the most suitable solution for your family’s needs. Rest assured that we’ll keep you updated on any changes to the capping of care home fees, and we’re committed to providing the best possible care for your loved ones.
Remember, planning the funding for your loved one’s care is essential, and understanding the care home fees cap is just one part of the process – there are many care home funding options to explore. We’re here to help, please feel free to reach out to us to learn more about our care homes and how we can support your family’s unique needs. Together, we’ll ensure your loved ones receive the care and support they deserve.