We are often asked by our clients about paying for their care fees now and in the future, in this blog Karen MacDonald, an Independent Financial Adviser, discusses what assessments should be made to determine whether you should even pay for your care fees and what to do once you have been assessed. Over to Karen…
Frequently clients approach me for advice on how to meet their care fees, not knowing where to start. Before you decide HOW to pay, it should be established IF you need to pay.
The following assessments should be made, in this order:
- NHS Continuing Healthcare Assessment – an assessment will be made by the NHS, for example on discharge from hospital. If the need is a ‘primary health need’, ALL CARE NEEDS should be provided free by the NHS, whether at home or in a nursing home. If this assessment indicates a lesser need, clients in a nursing home may be entitled to Funded Nursing Care, which is a weekly allowance, paid directly to the home.
- Social Care Assessment – if NHS Continuing Healthcare doesn’t apply, Social Care Assessment assesses what non-medical care is needed and how severe the need is. This care may be available privately or from the Local Authority but will be charged for. If there are eligible needs, Local Authority financial support may be available subject to means-testing.
- Financial Assessment – is the means tested assessment, conducted by the Local Authority. They will supplement your income up to a limit, but if you have capital over £14,250* you must meet some or all of the remainder of the fees. Capital includes savings, investments and property. If capital exceeds £23,250* the Local Authority does not have to help. However, some pension income for couples may be ignored (‘disregarded’) as are certain assets (such as the home if the spouse still lives there, or certain types of investment). Other exclusions can also apply, so an individual discussion would help to identify how this complex area would apply in individual situations.
- If the Local Authority is contributing to your fees, they will only do so up to a limit (the ‘Local Authority rate’). If your fees are higher than this, you are not permitted to pay the rest from your own resources (as they have assessed you do not have enough), so this means friends or family must be prepared to top up the Local Authority contribution, or you move to a home where the fees are within the Local Authority rate. If you are self-funding, of course, you can pay as much as you like yourself.
These assessments are not just for the person receiving care – if you are providing care for someone, you should be assessed too. Frequently, the health of carers is overlooked, which is not beneficial for either in the long run.
Only after considering all the above can you know whether you should be paying your own way at all, in full or in part. Then you can consider how best to use the cash and other assets available to you to meet current needs, and to allow for any future increase in care needs/costs.
The first step here is to make sure you are in receipt of all state benefits you are entitled to – Attendance Allowance is appropriate for most and is not means tested. If you are already getting the Lower rate check whether you are now eligible for the Higher rate. You may also get the Funded Nursing Care referred to earlier, although this is paid direct to the care provider and just reduces your bill.
Then make sure your savings and investments are arranged appropriately. This is the time when a specialist financial adviser can really be worthwhile. They will check you have accounts in the right names without running the risk of ‘deliberate deprivation’, crucial for a couple to preserve assets for the non-cared-for spouse; and that any shortfall in care fees is met by using savings in the most efficient way.
A specialist adviser must hold certain qualifications as a minimum, but for extra reassurance, find an adviser who is accredited by the Society of Later Life Advisers (SOLLA) www.societyoflaterlifeadvisers.co.uk
*(thresholds apply in England for 2016/17)
Levels and bases of may be subject to change
Karen can be contacted on 01403 288078 I www.planningcare.co.uk I email@example.com and offers a free initial consultation about any financial matters.