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Caring for our future: Consultation on reforming what and how people pay for their care

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Government accepted the Dilnot principles for future funding of care and support and subject to the passage of legislation will reform how care is paid for

A cap will be introduced on the costs that people have to pay to meet their eligible needs (from April 2016):

The cap will be set at £72,000 in April 2016 for people of state pension age and over.

The total cost of meeting a person’s eligible needs will count towards the cap, rather than the person’s financial contribution only. So many people will not have to pay the full cap amount themselves.

People of working age who develop care needs before retirement age will benefit from a cap that’s lower than £72,000.

People who turn 18 with eligible needs will receive free care and support to meet those needs.

Financial support will be provided to more people to help them with care costs (from April 2016):

This will help people with their care home costs if they have up to £118,000 (including the value of their home) rather than only those with up to £23,250, as happens currently.

Where the value of someone’s home is not counted, we intend to provide financial support with care costs to people who have up to £27,000. This could help people who have a partner or dependent living in the home, and people who are receiving homecare.

We will introduce the option to defer paying care home fees, so that people do not have to sell their home in their lifetime to pay for residential care (from April 2015):

People at risk of selling their home will be able to defer residential care fees and pay from their estate.

People in care homes will remain responsible for their living costs if they can afford to pay them:

Set a standard contribution to living costs of around £12,000 a year from April 2016 and this will not count towards the cap.

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Most support goes towards people with greatest needs and least wealth with extended access to financial support from the local council towards costs of care counting towards the cap

The additional state support of will count towards the cap.

The analysis assumes care fees of £660 per week, and the individual pays around £230 from income, and 3 yrs in residential care. Analysis completed in April 2016 prices.

This means that someone with £70k in assets will pay £30k of their care costs by the time they reach the cap. They will not pay the full £72k

Initial assets An individual’s contribution to care costs from assets after reaching the cap

Current £72k cap

£250,000 £177,000 £72,000

£200,000 £173,000 £72,000

£150,000 £127,000 £67,000

£100,000 £79,000 £45,000

£70,000 £50,000 £30,000

£50,000 £31,000 £17,000

£40,000 £21,000 £12,000

£17,000 or less £0 £0

Two-thirds of people who reach the cap will receive financial support.

Before and after introduction of the cap in April 2016

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For people needing care and support this means in practical terms…

Local councils support everyone, not just those with higher levels of need, to understand the options available to them, plan for meeting care and support needs and reduce or delay needs where possible.

People able to a defer the full costs of their care home up to the value of their property. People with eligible needs having their care costs counted towards the cap.

Accrued costs reported annually helping people to plan. Once they reach the cap, costs to meet their eligible needs being paid by the council.

Assessments helping people identify their needs, strengths, aspirations and the type of interventions that might be right for them, and determines whether their care costs count towards the cap.

Cap should improve affordability and relevance of financial products ready in time for 2016.

Transparent costs the local authority is paying or would pay to meet their eligible needs in independent personal budget or personal budget with the total cost of meeting a person’s eligible needs counting towards the cap.

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Summary of the consultation questions

Assessment of the care you need

• How should assessments work for people who pay for care out of their own money?

Paying for care

• How could we make sure people understand the rules that decide how much money they may get from their local council to pay for their care?

Meeting your eligible needs

• How should your local council work out how much it pays to meet your needs?

When the cap is reached

• How could we make sure you remain in control of your care so it is shaped around your needs when you reach the cap?

Making it happen

• What support should national Government and local councils make available to ensure that people are aware and prepared for the reforms?

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Part of our wider transformation to care and support enabling people to prevent and postpone care needs and giving people more control of their lives

The Care Bill currently going through Parliament:

Establishes a single unifying purpose of promoting the individual’s well-being in all decisions made about them around which adult social care is organised

Delivers many of the commitments in the Caring for our Future White Paper

Provides for a new cap on care costs and universal deferred payment agreements for funding care and support, based on the recommendations of the Dilnot Commission

Achieves a fundamental reform in its own right, to simplify and clarify over 60 years of legislation, following the recommendations of a three-year review by the Law Commission

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We will support local government make the significant changes to how local authorities operate currently to nationally reform how people pay for their care

• Government will provide £335m in 2015/16 to cover the costs of preparation for the cap and the requirement to offer deferred payments for residential care

• Department of Health, Local Government Association and ADASS have committed to work in partnership on a joint programme to support successful and sustainable delivery

• Commitment to continued engagement with organisations tasked in delivering these changes, and the people who will benefit from them, to contribute to making decisions on how they will be made

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Delivering the reforms in partnership with local government and other who have a role in delivering them • Engage everyone who has a role to play through our consultation.

• Establish the partnership between Department of Health, LGA and ADASS and work together on detailed implementation plans to support effective preparation for and implementation of reforms.

Summer - Autumn 2013

2013 - 2014

April 2015

• Respond to the consultation setting out more detailed plans.

• Subject to introduction and passage, the Care Bill creates a new legal framework for care and support, including the cap, extended access to financial support, and deferred payment agreements.

• Continued engagement with local authorities, providers, voluntary and community sector, financial services organisations and individuals and carers on details including regulations and guidance.

April 2016

• Introduce deferred payments and preparation for introduction of cap using the £335m allocated in the Spending Review.

• Wider reform including national minimum eligibility standard and fairer charging framework.

• Introduction of cap on care costs, and extended access to financial support.