Paying for support

Paying for your care (part 1) without reference to Individual Service Funds

This version of the animation does not mention Individual Service Funds.

Paying for your care (part 2)

Your contribution towards care services will depend on your income and savings. We'll assess your financial situation to determine a fair amount.

Key points:

• Financial assessment: Providing accurate information about your income and savings is crucial.
• Full payment: If you don't provide the necessary information, you'll be responsible for the full cost of your care.
• Chargeable services: Many care services have associated costs. These include:
  • Day care (outside of residential care packages)
  • Personal care assistance
  • Outreach support
  • Supported living services
  • Time Out services
  • Extra Care Housing

Exemptions: You won't have to pay a charge if you:

• Have Creutzfeldt-Jakob Disease
• Receive 100% Continuing Healthcare Funding
• Are receiving aftercare under Section 117 of the Mental Health Act

Financial Assessment

Your financial contribution towards care services depends on your income and savings.

• Capital threshold: If your savings exceed £23,250, you may be required to pay the full cost of care.
• Income and savings: If your savings are below £23,250, we'll need detailed information about your income and investments. This includes bank statements, passbooks, and share certificates.
• Additional factors: The financial assessment considers property-related expenses and disability-related costs. It also identifies any eligible benefits you might be missing out on.
• Payment timing: Your contribution starts from the date your care services begin. Providing necessary information promptly helps ensure accurate calculations.
• Affordability: Your contribution will not exceed the actual cost of care or the amount the government determines you can afford.
• Financial statement and invoice: Once the assessment is complete, you'll receive a statement explaining the calculation and an invoice starting from the service commencement date.
• Individual assessments: Financial assessments are done on an individual basis, even for couples, ensuring adequate funds remain after contributions.

Calculating your weekly charge

Your weekly charge will be the lower of the following two amounts:

• Assessed income: This is the amount you've been determined to be able to afford based on your financial assessment.
• Cost of Care: This is the actual cost of the care services you receive.

Understanding assessed income

Your assessed income is calculated by considering:

• Income from all sources: This includes benefits, allowances, pensions, and other income.
• Exclusions: Earnings from employment, charitable income, certain benefits (like winter fuel payments), and specific components of disability benefits are not included.
• Tariff income from capital: If you have savings between £14,250 and £23,250, a portion of this may be considered as income.
• Personal allowance: A portion of your income is exempt as a personal allowance.
• Allowance expenditure: Certain expenses related to your home and disability are deducted.

Cost of Care

The cost of care varies depending on the specific services you receive.

Important notes:

• Non-Disclosure: Failing to disclose your financial information may result in you paying the full cost of care. Estimated charges: We can provide an estimate of your potential charge based on your financial information. Contact the Financial Assessment Team at 01782 236620.
• Provider issues: If your care provider fails to deliver services, please notify us. We will review your case and may adjust your charges.
• Reducing care packages: Reducing your care package may not always result in a lower charge.
• Financial hardship: If you're struggling to afford your contribution, you can appeal the decision.

Will there be a charge?

Everyone in a residential or nursing home has to pay an amount of money towards the cost of their care. Some people will pay all the cost and other people may pay part of the cost with the council paying the rest.

Can I get help with the cost?

Information and guidance on support available for people to pay for care can be obtained from talking to the Financial Assessment Team 01782 236620.

About paying for residential care

The council has a responsibility to work out what a person’s care and support needs are and to provide them with the necessary care. People may have to pay for the care they get. This depends on different factors including how much money they a person has. We assess people individually, whether they have a partner or not and everyone in a residential home has to pay something towards their care.

How much will I have to pay?

The amount a person will pay depends on:

• income for example, a pension
• any savings a person has
• the type of care and support a person is receiving

Because of this, the council needs to know about all the money you have coming in. This includes Retirement Pension, Superannuation, War Pension and any other income. "Savings" may include the value of your own home. This is explained below.

Will I have to give all my income to pay for care?

No. You will be able to keep an amount, called your Personal Allowance. The amount of this is set by the Government each year. From April 2023 the personal allowance is £28.25 a week.

What about my savings?

If your savings are:

• less than £14,250 - you will not have to pay anything from your savings
• more than £14,250 but below £23,250 - you will be charged £1 per week for every £250 or part of £250 over £14,250 (for example, if you have £15,000 saved you will be expected to pay £4 a week from your savings)
• Over £23,250 - you will have to pay the full cost of your care. However, if your savings are likely to fall to this level, we strongly advise that you contact us at least 3 months in advance so that we can talk with you about how we may be able to help

Will I get any help with paying for my care?

Dependent on financial circumstances extra help may be available through benefits such as Income Support or Pension Credit. We will include this in the income a person has when they decide how much should be paid. We have a set a top limit on the fees it will pay. Individual residential or care homes may charge more than this. If you decide you want to live in a home that is more expensive than our limit, then you will have to arrange for someone else to pay the extra. This will be explained by your worker.

Do I still have to pay if I'm on holiday or in hospital?

Yes, if you go on holiday your place in the home still has to be paid for. If you go into hospital, the home has to be paid for up to 6 weeks. If you're in hospital for more than 6 weeks, different arrangements may apply.

Will my house be taken away?

No. The value of your home may be used in working out how much has to be paid for care in a residential or nursing home. We will not force a person to sell their house to pay for care. If the value of the house is included in working out charges for care, a Deferred Payment Agreement will be offered.

The value of a house will not be counted in the following situations:

• you are not going into residential care permanently
• your husband or wife lives there
• a relative aged over 60 lives
• there a child aged under 16, who you are responsible for, lives there
• a disabled relative lives there
• a long term carer lives there

If the situation changes you must let us know when this happens. They may then include the value of your house, when they work out how much you have to pay. You can discuss this with your worker, or read the documents on this page.

Deprivation of Assets

It is against the law to dispose of your house or any other asset to avoid or reduce your contribution towards the cost of your care, which could mean you may be expected to pay the full cost of your care. To understand more about what Deprivation of Assets means, information is available in the related links section on this page.

Do I have to give my financial details?

You don't have to provide any details of your income or savings if you don't want to, but if you don't you will have to pay the full cost of your care.

Guidance for Placements into Residential or Nursing Homes – Personal Choice Contributions (Third Party Top Ups)

This guidance outlines the care fee ‘top-up’ arrangements for a person receiving care and support in a Registered residential or nursing care home. This is known as a Personal Choice Contribution (PCC) and is often referred to as a Third Party Top-Up Agreement.

Direct payments aim to give you more flexibility in how your services are provided. By giving you money instead of social care services, you have greater choice and control over your life and are able to make your own decisions about how your care and support is delivered.

With a direct payment, you can:

• Choose and hire your own care givers (personal assistants).
• Buy services from care agencies or community organisations.
• Purchase equipment for your home.

Who can get a direct payment?

To receive direct payments, you will have had an assessment which identifies that you are eligible to receive social care support. People who can receive direct payments include:

• Older adults needing community care.
• Carers aged 16 and over.
• People with disabilities (including parents of disabled children).

To get a direct payment, you must be able to:

• Manage your money and personal budget.
• Arrange and pay for your own care.

There are some things you cannot use direct payments for:

• Full-time residential or nursing care.
• Hiring family members living with you.
• Council-run care services.
• NHS services.
• Personal household items or housing costs.

There may be a charge for your care, depending on your income but we discuss your needs and help you to manage your direct payment.

We offer information, advice, and support to help you manage your direct payment. You can also use a payroll company to help with tasks like paying staff.

How do I apply for a direct payment?

We try to make direct payments as easy to manage as possible. If you do decide to opt for a direct payment, our direct payment team can provide information and advice around managing your direct payment. More Information Direct Payments Policy: Direct Payments (trixonline.co.uk)

What is the Deferred Payments Scheme?

The Deferred Payments Scheme is designed to help you if you have been assessed as having to pay the full cost of your residential care from the thirteenth week of permanent residence but cannot afford to pay the full weekly charge because most of your capital is tied up in your home.

Effectively the scheme offers you a loan from Stoke-on-Trent City Council using your home as security. It doesn’t work in exactly the same way as a conventional loan; the Local Authority doesn’t give you a fixed sum of money when you join the scheme but pays an agreed part of your weekly care and support bill for as long as is necessary.

You will pay a weekly contribution towards your care that you have been assessed as being able to pay from your income and other savings. From the thirteenth week, you are entitled to claim Attendance Allowance or have it reinstated. The council pays the part of your weekly charge that you can’t afford until the value of your home is realised.

The part the council pays is your ‘Deferred Payment’.

The deferred payment builds up as a debt – which is cleared when the money tied

up in your home is released. For many people this will be done by selling their home, either immediately or later on. You can also pay the debt back from another source if you want to.

However, you do not have to sell your home if you don’t want to. You may, for example, decide to keep your home for the rest of your life and repay out of your estate, or you may want to rent it out to generate income. If you do this, you will be expected to use the rental income to increase the amount you pay each week, thus reducing the weekly payments made by the Council, and minimising the eventual deferred payment debt. Your entitlement to claim Pension Credit may be affected if the property is not put on the market.

Charging interest

The loan will have interest charged on it in the same way a normal loan would be charged on money borrowed from a bank. The interest rate charged is fixed by the government, it is based on the cost of government borrowing and changes on 1 January and 1 July every year (you will be advised of the current interest rate at the time of your enquiry). The interest will be compounded on a 4 weekly basis and will apply from the day you enter into the Deferred Payment Scheme.

You will receive statements every 6 months advising you how your charge is being calculated and what the outstanding sum is on your deferred payment account.

If you decide to use the Deferred Payments Scheme, you enter into a legal agreement with the council by signing an agreement document. The council then places what is called a ‘legal charge’ on your property to safeguard the loan.

The agreement covers both the responsibilities of the council and your responsibilities, one of which is to make sure that your home is insured and maintained. If you incur expenses in maintaining your home while you are in residential or nursing care, these will be allowed for in the amount that you are assessed as contributing each week from your capital and income.

You can end the agreement at any time (for example if you sell your home) and the loan then becomes payable immediately.

Otherwise the agreement ends on your death and the loan becomes payable 90 days later.

The council cannot cancel the agreement without your consent.

Please note that a person will be unable to enter into a Deferred Payment Agreement if he/she lacks capacity. Any payments made by Stoke-on-Trent City Council to the provider will be invoiced to the person applying for deputyship and a letter of undertaking to pay the care fees must be signed by the person applying for the deputyship. Once the deputyship is obtained, the outstanding debt should be paid or resolved through a Deferred Payment Agreement.

Advantages of using the Deferred Payments Scheme

You should take independent financial and legal advice to help you decide which course of action will be financially better for you.

If there is an existing agreement for a third party ‘top up’, where a family member or other person puts additional money towards your placement, and you decide to take advantage of the Deferred Payments Scheme, you can add the cost of the ‘top up’ payments to your Deferred Payments Scheme loan if the council agrees that there is enough equity in your home.

The government’s rules say that ‘top ups’ for people not using the deferred payments scheme currently have to be paid for by somebody else – for example, a member of their family – so a deferred payment is currently the only way of paying the top up yourself without depending on a third party.

Costs associated with the Deferred Payments Scheme

There will be an administration charge of £229.

If other costs are incurred during the course of the agreement, there may be further one off charges; for example, a revaluation of a property.

Other options

You may choose to rent out your property, which could give you enough income to cover the full cost of your care. There are advantages to this as you will not accrue a debt, be liable for interest and administrative charges and your property will be occupied. Your tenant will be paying utilities and council tax which will reduce your outgoings.

There are also various equity release products which may be suitable for your personal circumstances.

You may also choose to pay the full cost of your care from your available income and savings/assets in order to reduce the deferred amount and interest charged. We would normally advise that you use your capital down to £3000. Alternatively, a family member may choose to pay some or all of this for you.

You should take independent financial and legal advice to help you decide which course of action will be financially better for you.

In order to apply for the Deferred Payment Scheme you must:

• have capital (excluding the property) of less than £23,250 
• be professionally assessed as requiring and be entering permanent residential /nursing care in a registered care home 
• own or have part legal ownership of a property, which is not benefitting from a property disregard, and ensure your property is registered with the Land Registry (if the property is not, you must arrange for it to be registered at your own expense) 
• have a year’s worth of funding in the property 
• have mental capacity to agree to a deferred payment agreement or have a legally appointed agent willing to agree this 
• Whilst in the agreement, you will also need to: 
• have a responsible person willing and able to ensure that necessary maintenance is carried out on the property to retain its value as you are liable for any such expenses 
• insure your property at your expense 
• pay any client contribution in a timely and regular manner; if you fail to pay the client contribution on a regular basis the council reserves the right to add this debt to the loan amount

There can be no other beneficial interests on the property, for example outstanding mortgages or equity release schemes, unless this is approved by Stoke-on-Trent City Council.

Please note: Acceptance of any application under the scheme is subject to you meeting the criteria for entering the scheme, and Stoke-on-Trent City Council being able to obtain security in your property.

Where you can get independent advice

If you require general advice you can contact the following:

Money Advice Service

www.moneyadviceservice.org.uk 
Telephone: 0300 500 5000

Which

www.which.co.uk/elderly-care
Telephone: 01992 822 800

Age UK

www.ageuk.org.uk 
Telephone: 0800 169 6565

If you require more specialist advice you should contact an independent financial advisor.