Long term care funding cap - change in the care fee rules

The government is set to announce a funding cap on the amount we will have to pay for social care.

Current care funding rules

The current rules are largely based upon a means-tested system. If an individual requires social care and they have over £23,250 in capital assets then they have to privately fund the cost of residing in a care home. Those with capital assets of between £14,250 and £23,250 have to contribute towards their care and only those with less than £14,250 in capital assets receive state funding to pay for their care.

There is currently no lifetime limit on the amount an individual can pay for care. Capital assets include the value of any property (including your main home) and many families have had to take the unfortunate step of selling a home to fund the cost of care.

Proposed changes

It has been widely reported that those rules are set to change with a funding cap expected to be put in place. Plans for a funding cap of £75,000 are due to be announced although the exact details have yet to be released. In addition to the funding cap it is likely the capital asset limit of £23,250 will be increased to £123,000.

Jon Gould, Associate in the Private Client team at DWF comments: "The expected change is a step in the right direction although there is doubt as to whether or not the change has gone far enough. It is likely the £75,000 funding cap will only cover the cost of nursing care and not cover accommodation and food. Such costs can be in the region of £10,000 per annum alone and therefore the cost of care will still be a serious issue to many families. I would still urge families to seek specialist legal and financial advice and review all of their options. The Private Client Team at DWF are experts in long-term care fees and associated issues. We are members of Solicitors for the Elderly and STEP (The Society of Trust and Estate Practitioners) and will be able to advise fully in relation to the forthcoming changes".