Social Care Fees Cap £86,000 Not What You Think

The social care fees cap i.e.  the maximum you pay in your lifetime for care fees was announced this week at £86,000.  It was originally proposed in the Care Act 2014 at £72,000 but was ‘shelved’.

The cap is now due to start next year in April 2022 and any excess fees will be covered by the new Health and Care Levy that starts in 2023 at 1.25% on national insurance contributions and 1.25% tax on dividends.

However, this is not all it is ‘cracked up to be’ and riddled with political spin.

Care is made up of three elements:

• Health Care:  medical treatment in hospital, at home or in a care home..
• Personal Care: where you need help and support for activities of daily living (ADLs) of a personal nature such as bathing, showering, applying creams and lotions, changing dressings, getting dressed, laundry and toileting and continence.  Again, this can be at home or in a care home.
• Board and Lodgings:  We call this your ‘hotel’ costs.  Clearly, if you live at home, there are no costs but there is a cost if you are in a care home.

Who Pays and the £86,000 Cap:

• Health Care:  medical treatment in hospital, at home or in a care home is funded by the NHS, you do not pay for these.
• Personal Care: There is to be a new means test where if you have assets below £20,000, the state will pay.  Assets between £20,000 and £100,000 you pay some of your personal care costs on a sliding scale.  Assets in excess of £100,000, you will pay in full for personal care costs.  Where you are required to pay, whether in full or the sliding scale, these costs have a lifetime cap of £86,000 and then the state will pay.
• Board and Lodgings:  ‘Hotel’ and food costs are means tested and if you have assets in excess of e.g.£20,000/ £23,500, you still pay for your accommodation costs in full.  These costs are not included within the new £86,000 cap.

Another Kick in the Teeth:

Apart from the fact that you now know that the £86,000 lifetime fees cap only applies personal care, you should also know that any personal care fees paid before April 2022 are not included in the £86,000 cap.  Only cumulative payments for personal care paid after April 2022 count towards the £86,000 cap.

NHS Continuing Care

Where you need residential care primarily due to poor health, the NHS will pay for all health, personal care and accommodation costs.

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