What Are the New Rules For Care Payments?

In 2021, the government announced changes to how social care is funded in England. One of the most significant changes is a new £86,000 cap on how much anyone will pay for their own personal care throughout their lifetime. They also increased the thresholds for receiving financial support. These changes were originally planned for October 2023 but have been delayed until October 2025

Your Guide to the Updated Care Payment Rules in England

Navigating the costs of care for yourself or a loved one can be confusing and stressful. In 2021, the government announced significant changes to how care is funded in England  in their ‘Build Back Better: Our Plan For Health and Social Care’ publication.. These changes, including a new care cap, were initially planned for 2023 but have been delayed until October 2025.  This guide aims to break down these complex rules and explain what they might mean for you and your family’s financial future.

Key Changes to Care Funding

Understanding the upcoming changes to care payments is crucial for making informed financial decisions. Here’s a breakdown of the most important points:

Change	Current Rule (Until Oct 2025)	New Rule (From Oct 2025)
Lower Threshold for Funding	£14,250	£20,000
Upper Threshold for Funding	£23,250	£100,000
Lifetime Care Cap on Personal Care Costs	None	£86,000

Increased Thresholds

The amount of money you can have in savings and assets before needing to pay for care is going up.

• Lower threshold: Increases from £14,250 to £20,000.
• Upper threshold: Increases substantially from £23,250 to £100,000.

The £86,000 Care Cap

This is a new lifetime limit on how much you’ll pay for your personal care needs (things like help with washing, dressing, and medication).  Important points:

• Applies only to personal care costs, not things like accommodation or food.
• Any care costs paid before October 2025 won’t count towards the cap.

What the Care Cap Means for You

The impact of the new care cap and thresholds will depend on your individual financial situation. Let’s look at some possible scenarios:

Scenario 1: Assets Above £100,000

• You’ll be responsible for paying your care costs until your assets drop below £100,000 or you reach the £86,000 care cap.
• Once you hit the cap, your local authority will cover the cost of eligible personal care.
• You’ll still be responsible for accommodation, food, and other related expenses.

Scenario 2: Assets Between £20,000 and £100,000

• You’ll contribute towards your care costs on a sliding scale, along with a ‘tariff’ contribution calculated based on your assets.
• It may take a considerable amount of time to reach the £86,000 care cap.
• You’ll still need to cover accommodation and additional costs.

Scenario 3: Assets Below £20,000

• Your local authority will likely fund your care.
• You may still need to make some income-based contributions.

Key Points:

• Importance of Financial Planning: Understanding how these rules apply to you is vital for budgeting and long-term care planning.
• Accommodation Costs: Remember, the care cap does NOT cover accommodation, food, or other living expenses. It’s essential to factor these costs into your financial planning.

When Do the Changes Take Effect?

While the new care payment rules were initially scheduled for October 2023, the government has postponed their implementation until October 2025. This delay raises important considerations.

• Updated Timeline: It’s crucial to remember that the £86,000 care cap and the increased thresholds will NOT be in place until October 2025.
• Reasons for the Delay: The government has cited the need to stabilise public spending as a primary reason for the delay. This change was estimated to save approximately £2 billion.

Important Note:  Any care expenses you pay before October 2025 will not count towards the care cap once it’s implemented.  This emphasises the importance of continued financial planning under the current system until the changes take effect.

Impact on Different Regions of the UK

It’s important to understand that the care cap and the changes to funding thresholds apply specifically to England. Let’s outline the key differences in other parts of the UK:

Wales:

• Wales already has a more generous system of thresholds compared to England.
• They have no lower threshold and a higher upper threshold, currently standing at £50,000.
• This threshold may increase again in April 2024.

Scotland:

• Scotland’s thresholds for local authority-funded care were recently increased.
• The current lower threshold is £20,250, and the upper threshold is £32,750.

Northern Ireland:

• Northern Ireland maintains its own care funding system with different rules.
• The lower threshold remains at £14,250 and the upper threshold at £23,250.

Finding Resources for Your Region:

If you live in Wales, Scotland, or Northern Ireland, it’s essential to seek information from sources specific to your region.  Here are some helpful starting points:

• Wales: Age Cymru (https://www.ageuk.org.uk/cymru/)
• Scotland: Age Scotland (https://www.ageuk.org.uk/scotland/)
• Northern Ireland: Age NI (https://www.ageni.org/)

What You Can Do Now

Navigating the complex world of care funding can feel overwhelming.  Here are some proactive steps you can take regardless of when the new rules go into effect:

Seek Professional Advice:

• Financial advisors specialising in care planning can provide personalised guidance on funding options and strategies.
• Care specialists can help you understand care needs and potential long-term costs.

Explore Funding Options:

• Research potential sources of financial support, such as:
  • NHS Continuing Healthcare: For those with complex health needs.
  • Attendance Allowance or other benefits: Check your eligibility.

Plan Ahead:

• Start financial and care planning as early as possible, even if your situation seems stable.
• Discuss preferences for care settings and potential costs with your loved ones to ensure alignment.

Frequently Asked Questions

Here’s a selection of common questions and concise answers to clarify potential points of confusion:

Q: Does the care cap apply if I have dementia?

A: Yes, the care cap applies regardless of your diagnosis. However, those with dementia may have higher care needs, potentially reaching the cap faster.

Q: What happens if I own a house?

A: The value of your home will usually be included in your financial assessment if you require residential care. There may be options to defer payments under certain circumstances.

Q:  I’m currently paying for care. Will the new rules help me?

A: It depends on your assets. The increased thresholds may make you eligible for some local authority support. The care cap could potentially limit your lifetime care costs.

Q: Where can I find reliable information and support?

A: Here are some trusted resources:

* Government websites: https://www.gov.uk/government/publications/build-back-better-our-plan-for-health-and-social-care/adult-social-care-charging-reform-further-details

* Charities: Age UK (https://www.ageuk.org.uk/), Alzheimer’s Society (https://www.alzheimers.org.uk/)

* Independent care advice services (search online for providers in your area)

Understanding the New Care Payment Rules: Take Control of Your Future

The upcoming changes to care payments in England represent a significant shift in how care is funded. While the delay to 2025 provides more time for preparation, understanding the new thresholds, the care cap, and their potential impact on your finances remains crucial.

Remember, navigating this complex system can be challenging. Seeking professional advice and exploring available resources is essential for informed decision-making and ensuring the best possible care for yourself or your loved ones.

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