The government's Care Act legislation contains many changes to social care, but the two main changes affecting how care is funded are:
1. A lifetime cap on care costs set at £72,000
It is proposed that a cap of £72,000 will be introduced. That means that no one will have to pay any more for their eligible care needs to be met once they have spent a total of £72,000.
This cap will apply to the cost of care that people receive either in their own home or living in a care home.
It does not include someone's ‘hotel costs’ (i.e. bed and board) if they are living in a care home. These would still be charged separately even after reaching the cap, however, hotel costs will be capped as well at £12,000 per year.
The cap was due to come into effect from April 2016 but the government has delayed this until April 2020.
2. Changes to the means test
The means test is where a person’s finances and assets are looked at to decide how much they should contribute towards the cost of their care.
Changes to the means test were due to come into effect in April 2016, but they are now also set to be delayed until April 2020.
At the moment, your capital and savings below £14,250 are disregarded in the means test.
If you have:
- between £14,250 and £23,250 in capital and savings and you are eligible for care, the council will contribute towards your care costs
- capital and savings above £23,250, you will have to fund all of your own social care.
After April 2020:
- the £23,250 upper limit will be raised to £118,000
- the lower limit will be raised to £17,000
Therefore, anyone with assets of between £17,000 and £118,500 who meets the eligibility criteria for care will be entitled to some financial support according to a sliding scale.
To put it another way, anyone with less than £118,000 in savings will in future be entitled to at least some financial support to help pay their care costs if they need to enter a care home.