Paying for a care home
If you move into a care home there will be a charge for your accommodation and care.
There are a number of ways by which the fees can be paid:
- You may be asked to pay the fees in full or in part, depending on your resources (income and capital) as laid down in the National Assistance Act 1948. We will need to carry out an assessment of your financial position in order to determine how much you will pay towards the cost.
- If you go to live in a care home under a nursing contract, the cost of the nursing will be paid by the Health Service; you will only contribute towards the residential element of your care.
- Should you receive after-care services provided under Section 117 of the Mental Health Act 1983, you may be exempt from any charge; your care manager will discuss this with you at the time your care is arranged.
The council's rate
Croydon Council pays up to a fixed rate for care homes. The rate varies depending on what level of care is required. There are two circumstances in which you may be able to enter a home that charges more.
- You can opt for a deferred payment agreement (see below for further information), in which case the extra cost will be added to the amount that you owe
- you could ask a third party - for example, a relative or a friend - to pay the difference.
Before we can agree to either arrangement, we must be satisfied that you or your relative/friend are able to afford to do this for the duration of your stay.
If you are unable to pay the extra money, you should consider other options such as a less expensive room or choosing another home. You should discuss this with a care manager or seek independent advice, for example from Age Concern or Citizens Advice Bureau before you move into the home.
If you are already living in a care home and need assistance with funding your care, Croydon Council may not be able to pay the full amount of your care fees if they are above our fixed rate. We would try to negotiate with the owner of the care home to reduce the fees but, failing that, you may need to consider moving to another home.
Therefore, if you are living in, or considering moving to, a home that has a weekly fee above Croydon's contracted rate, you should seek clarification from the home as to whether you would be able to remain resident if, in the future, you should need financial help from Croydon Council.
If you own your own home, the value of your property will be included in the assessment of the resources available to you to pay your fees in permanent care. However, there are exceptions to this.
The property value will not be included if the property continues to be occupied by:
- your partner
- a relative who is either aged 60 or more or who is sick or disabled
- a child you are maintaining who is aged under 16
- other people where we believe that this is reasonable.
The value of your property is not taken into account:
- during any temporary stay in care
- for up to 12 weeks after you have decided that you wish to stay permanently. This gives you time to arrange to sell your home or to consider other options.
If your property has been transferred to someone else, we will take account of the circumstances of the transfer. You should send a copy of the agreement confirming the transfer with your completed financial assessment form to the financial assessment team.
We will ask our legal department for a decision as to whether your property should be included in your assessment.
Options for home owners
If your property is taken into account for your financial assessment, the options open to you include:
- putting your property up for sale
- retaining your property and applying for a deferred payment agreement
- renting out your property
- arranging to fund your care by independent means.
You may wish to discuss these options with a friend or relative, or take independent financial and legal advice before making a final decision. If you choose to put your property up for sale, you pay a contribution towards your care and we will fund the shortfall until your house is sold. We expect you to reimburse us at this stage.
If you are eligible for either Attendance Allowance or the care component of Disability Living Allowance, you can be paid these benefits if you are either awaiting the sale of your property or you have opted for a deferred payment agreement. However, they are not payable during the 12-week property disregard period.
Deferred payment agreement
This option is available to people who do not wish to sell their homes whilst they are living in a care home. You will still contribute towards the cost of your care from your income, but the shortfall between your contribution and the full care cost will be deferred.
The agreement allows a legal charge to be placed on your property with the result that the cost of your care will be recoverable from the proceeds of your home when it is eventually sold.
Renting the property
If you choose this option, the rental income may allow you to fund your full care costs. However, your property should only be rented on a short-term let basis and you should send a copy of the letting agreement to the financial assessment team. Where the rental income does not cover your full care costs, you may wish to apply for a deferred payment and use the rental income to reduce the amount deferred against your property.
A legal charge will be placed on your property to ensure that the council is reimbursed for the care fees that have been paid.
The amount to pay
You will be responsible for paying the full fees if:
- your weekly income is greater than the weekly fees
- you have more than £23,250 in savings or other assets. We will not take the value of any property you own into account for the first twelve weeks after you decide that your stay is permanent. During this time, you will be expected to contribute towards your care costs from your income and any other savings that you have in excess of £14,250.
You will not be responsible for the full fees, but will be required to pay a contribution, if your total savings and assets are valued at less than £23,250 and your income is less than the weekly care fees.
In order to assess how much you have to pay, we are required to follow a set of rules that are laid down in law as well as guidance given by the Department of Health. We will ask you to complete a confidential financial assessment form giving details of your income and your capital such as savings and other assets. From the information you give us, we will add together all relevant sources of income, including state benefits, and a notional income from any savings or assets you have between £14,250 and £23,250.
If we think you are entitled to any additional state benefits we will advise you of this and assist you to claim them. Part of some war-related benefits will be ignored in your assessment. We will then work out the allowances that should be offset against your income.
If you have a spouse or partner, we will make an allowance of half of the total value of any occupational or private pension you receive, with your agreement. You may wish to seek advice through our welfare benefits advice service about the impact of this on the benefits of your spouse.
The amount that you will be required to pay will be worked out by subtracting your total allowances from your total income.
You will generally be left with at least £22.60 per week, the standard personal expenses allowance, but this may be increased if, for instance, you have ongoing housing or other essential costs, or you have been awarded the savings credit as part of the new Pension Credit.
When we have worked out your contribution, we will write to tell you how much you have to pay.
Please contact the financial assessment team if your circumstances change (for example, because you inherit money) as we will have to review what you have to pay. We will review the amount you have to pay in April each year.
Making a financial assessment
Make a list of all your finances. This should include all your sources of income, all your savings and any other assets, including any property that you own but do not live in as your home. Your care manager will be able to tell you the weekly cost for the home you are going to.
If you do not know yet which home you will be going to, you should be able to establish the approximate fee for the type of home you are interested in. If you have capital of over £23,250, we will advise you how long it will take for your savings to reduce to this figure. We cannot tell you how your money should be spent, but you should be aware that we may treat you as still having any assets that you have given away or otherwise disposed of in order to reduce your liability for care fees.
The financial assessment team can advise you about this, contact them on the charging helpline, details below.
Citizens Advice Bureau: New Addington
1a Overbury Crescent
Surrey CR0 0LR
Financial Assessment Team
Financial Assessment Team
People Department – Welfare and Enablement
3rd Floor, Zone C
Bernard Weatherill House
8 Mint Walk
Croydon, CR0 1EA