Deciding to move a loved one into a care home is a significant decision that involves careful planning and consideration, especially when it comes to finances.

Understanding the concept of a care home fees cap can alleviate some of the stress associated with this process. 

In this guide, we'll walk you through what the care home fees cap entails, how it works, and what it means for you and your loved ones.
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What is the Care Home Fees Cap?
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The care home fees cap is a limit set by the government on the amount individuals have to pay for their eligible care costs over their lifetime. The idea is to prevent people from facing unlimited care costs, which can be financially devastating.
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How Does the Care Home Fees Cap Work?

Here’s a breakdown of how the care home fees cap is structured:

Eligible Care Costs

Only certain types of care costs count towards the cap. These are typically the costs necessary to meet your loved one's eligible care needs, as assessed by your local authority. 

Costs not related to direct care, such as accommodation and food, generally do not count towards the cap.

Lifetime Cap Amount

The lifetime cap amount is the total amount an individual will have to pay for their eligible care costs before the government steps in to cover the remaining costs. As of now, the proposed cap in England is set at £86,000.

Local Authority Assessments

To benefit from the care home fees cap, your loved one will need to undergo an assessment of care needs by the local authority to determine their care needs and the associated eligible costs. 

This assessment ensures that only the necessary care costs are counted towards the cap.
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What Happens When the Cap is Reached?

When your loved one reaches the care home fees cap, the local authority will start to pay for the eligible care costs. 

However, it's important to note that individuals may still need to contribute towards their living costs, such as accommodation and daily living expenses.
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When is the Care Home Fees Cap Coming Into Place?

The care home fees cap is set to be introduced in October 2025 after being delayed by two years . This timeline provides some opportunity to plan and prepare for the upcoming changes.
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Understanding the Financial Impact

The introduction of a care home fees cap aims to protect individuals from the risk of catastrophic care costs, but it's essential to understand its limitations and plan accordingly.

Costs Not Covered by the Cap

While the cap covers eligible care costs, it does not cover accommodation, food, or other personal expenses. These costs can still be substantial, so it’s crucial to consider them in your financial planning.
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Means-Tested Support

In addition to the care home fees cap, means-tested support may be available for those with limited financial resources. This support is determined by a financial assessment conducted by the local authority and can help cover both care costs and some living expenses.
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Planning for Care Costs

Given the complexities of care home fees and the cap, it's essential to plan ahead. Here are some steps to help you prepare financially:
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Evaluate Your Loved One's Needs

Understand the level of care your loved one requires and whether their needs are likely to change over time. This will help you estimate future costs more accurately.
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Explore Financial Products

Consider financial products designed to help cover care costs, such as care annuities, equity release, and long-term care insurance. These products can provide additional financial support and peace of mind.
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Seek Professional Advice

Consulting with a financial advisor who specialises in care planning can provide valuable insights and help you make informed decisions about funding care. There may also be benefits you can claim as self-funders.
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Monitor Policy Changes

Stay informed about any changes to care funding policies and the care home fees cap. Government policies can evolve, and staying up-to-date ensures you are aware of the latest information and support available.

Dealing with the financial aspects of care home fees can be challenging, but understanding the care home fees cap is a crucial step in planning for your loved one's future. 

By knowing how the cap works, what costs are covered, and how to prepare financially, you can make more informed decisions and ensure your loved one receives the care they need without facing overwhelming financial burdens.

For more personalised guidance, our team at Ashberry Care Homes is here to help. Get in touch today to learn more about our services and how we can support you in this important journey.

Sources

1. Gov.uk - Overview of the Care Cap
2. https://www.careuk.com/where-do-i-start/what-affects-cost/what-the-care-home-fees-cap-means-for-you

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