Funding Care Home Places: How Local Authorities Support Costs

With over 400,000 elderly and disabled people living in care homes across the UK, local authorities play a vital role in funding places for residents unable to pay full fees themselves. Care home funding represents one of the largest expenses for adult social care budgets. Local authorities use various methods to fund or supplement the costs based on stringent assessment criteria.

Assessing Eligibility for Funded Care Local authorities have a legal duty to arrange care for eligible residents if they have assets below £23,250. First, a needs assessment determines if a care home is appropriate based on physical, mental and medical needs. Financial assessments are then used to evaluate if the resident qualifies for local authority support. Income from pensions and most benefits is excluded, but savings and property values are considered except for the home residence if a partner still lives there. These assessments decide what level of funding, if any, will be provided.

Fully Funded Residential Care If a resident has assets below £14,250, the local authority must fully fund a standard care home to meet the individual's assessed needs. This means the authority covers the entire weekly fee for the duration of their stay. Food, utilities, accommodation, personal care and nursing are included, but extras like hairdressing are not covered. The eligible care home is usually selected from the framework of contracted providers, subject to availability.

Shared Funding Arrangements If capital assets are between £14,250 - £23,250, the resident will qualify for part-funding. Here, the local authority contributes a portion of the fees based on what the individual can afford to pay from their income and capital. This is known as a "top-up" arrangement. Third parties, like relatives, often help bridge the gap too. The residents must cover the remainder themselves from pensions, benefits or savings. Reviews adjust funding levels if financial circumstances change.

Short-Term & Emergency Funding Short-term, temporary funding may be granted to allow hospital discharge to a care home for recovery or assessment. This is usually for up to 12 weeks, maximum. In emergencies like illness, local authorities can also fund short-term placements of up to 8 weeks to avoid hospitalisation. Applications must provide evidence why existing home arrangements cannot meet urgent needs. Strict eligibility and time limits apply.

Personal Budgets and Direct Payments Instead of directly commissioning care, some local authorities allocate eligible individuals a personal budget to arrange their own care. The person receives direct payments equal to their budget amount to pay providers themselves. This allows more choice over care settings that meet cultural or religious needs, for example. Strict rules govern what payments cover and monitoring ensures accountability.

Third-Party Top-Ups If someone chooses a more expensive care home than the local authority would usually fund for their needs, the additional fees are called a third-party top-up. This is paid privately by the individual, family or charity. Local authorities must ensure third parties understand they will need to cover the top-up fees long-term and sign an agreement accordingly. Top-ups enable the choice of preferred, more costly care settings.

Ongoing Fee Negotiations Local authorities negotiate contractual rates with independent care homes to agree on annual fee increases for state-funded residents. Rates are set based on benchmarks of local care costs. However, if homes undergo existential crises from underfunding, authorities must increase rates to sustainable levels, ensuring market stability. This delicate balance affects funding levels and care availability.

Supporting Working-Age Adults While most funding is for older people, working-age adults with eligible needs can receive financial assistance for residential care, such as those with severe disabilities. Assessments take employment status and the ability to self-fund into account. Support aims to maximise independence where feasible.

Challenges & Shortfalls With demand rising but budgets tightening, local authorities make difficult decisions on allocating finite resources. Tighter eligibility criteria mean some borderline cases fall through the cracks. Families often end up privately funding care once assets deplete to avoid authority funding delays. Pressures on social care funding across the UK continues to mount.

In summary, needs and means testing determine if individuals qualify for fully or partially council-funded care home places. Strict eligibility criteria apply, but support aims to ensure the affordability of appropriate accommodation. However, limited budgets strain the system as costs and demand rise. Sustainable funding solutions remain a major issue.