There are over half a million people in the UK living in care homes with around half funding themselves and the other half receiving help from the local authority towards costs. With people living longer with each generation, these numbers are set to increase making it vital that anybody thinking about moving into a care home or thinking of moving a loved one into residential care, understands how much care home fees are going to cost.
What is the average cost of residential care for the elderly?
Nursing home costs vary across the UK and are different depending on where you live. This can sometimes make the cost of care home fees something of a postcode lottery. If you live in the South of England, for example, residential care in a nursing home can cost up to 40% more than in the North of the country. The average cost of care home in England also varies according to location but typically costs £700/week
To help you understand the price of residential care, here is a breakdown of the average monthly cost of a nursing home in the different countries that make up the UK.
|Region||Average monthly cost of a nursing home|
How do I pay for a care home?
The cost of a residential care home can be funded in many different ways. This can help with the question “How much are care home fees?” If the person in question is eligible for funding support from the local council, they could pay some or most of the fees directly to the nursing home. Before this is done, the council will carry out a needs assessment to conclude the level of care required. If the test highlights that residential care is suitable for the individual, a means test will be undertaken to decide if financial help is required and if it is, what level it will be set at. This means test will take into account the level of income and any capital assets the elderly person may have.
If the elderly individual does have to pay some or all of the fees, the monthly charge will be taken directly from their assets, usually their bank account.
If the elderly person’s needs are health-based, the NHS may arrange and pay for the entire cost of care, with the money coming from the NHS continuing healthcare (NHS CHC) scheme. If the local authority believes that the criteria for NHS CHC has been met, the local authority will refer them to the NHS for assessment. If the full criteria is not met but nursing care is still relevant, the NHS may pay a contribution towards the costs directly to the care home.
How do private care home prices differ from Council care homes?
Many care homes “cross subsidise” patients funded by the local authority with private clients. This means private families often pay substantially more for private care home fees.
What are the main drivers of care home costs?
The two main costs of care homes are staffing and cost of property. Additional costs include food, regulatory costs and costs of PPE (protective personal equipment.)
What is the care home costs threshold?
One of the main criteria for how much an elderly person will have to pay towards the cost of residential care is how much the person in question has in assets. If the local authority carries out a care needs assessment, they will assess how much income and capital the individual has before deciding how much they need to contribute towards care home charges. Some income and capital types, such as certain disability benefits, are ignored during the means test but on the whole any money paid to the person and any money they have in the bank will be taken into account.
It’s important to note that any property owned may also be considered capital when deciding the level of help provided, although there are certain exemptions.
Here is a brief overview of how much an individual will have to pay towards nursing home costs for each income / capital threshold:
|Capital||The amount the individual will have to pay towards the cost of residential care|
|£23,250 or over||Full fees must be paid. This is known as self-funding.|
|£14,250 to £23,250||You will be asked to contribute towards the cost of residential care from any income received, such as any pensions, etc. based on the means test undertaken by the local authority. On top of this you will have to pay an assumed ‘tariff’ based on the capital you have between £14,250 and £23,250. The rest of the costs will be paid by the local authority.|
|£14,250 or less||At less than £14,250 you will not be eligible to pay the assumed tariff based on the capital you own but will still be asked to pay a fee from your income as assessed by the means test. The rest of the costs will be paid by the local authority.|
Will my home be included in the nursing home fees means test?
In most cases, yes it will, although there are a few exceptions. If the elderly person in question need temporary care, the home will not be included in the means test undertaken by the local authority. The property will also not be included if the home is still occupied by any of the following:
- The persons partner or former partner (unless that person is estranged from them).
- The persons ex-partner or estranged partner so long as they are considered to be a lone parent.
- Any relative who themselves is over 60 years of age.
- Any relative that is registered as disabled.
- Any child of the elderly person in question who is under the age of 18.
Even if the property will be included as a capital asset in the means test, the local authority is compelled to ignore its value for the first 12 weeks of residential care to allow the individual time to settle into their new surroundings.
What is the Personal Expenses Allowance?
When assessing the level of help an elderly person will receive with their care home fees the local authority are obliged to leave them with a personal expenses allowance, i.e. a minimum amount of money each week to pay for things like personal items, treats, newspapers, and toiletries. This amount is different for each country in the UK and can be seen below:
- England £24.90 per week
- Northern Ireland £26.33 per week
- Scotland £27.75 per week
- Wales £29.50 per week