.svg)
What You Need to Know About Dementia Care Costs
What you need to know about dementia care costs
- Does everyone with dementia pay care home fees? No. Funding depends on health needs and financial circumstances.
- Can the NHS cover all costs? Yes, via NHS Continuing Healthcare if the primary need is healthcare rather than social care.
- What is the means-test threshold? £23,250 in capital. Below this, local authority support may apply.
- Is the family responsible for the fees? No, unless they have signed a contract agreeing to pay.
- What if private funds run out? The local authority steps in following a new financial assessment.
- Does the home count as an asset? Not if a spouse or dependent relative still lives there.
How Much Does Dementia Care Cost in the UK?
Dementia care in a UK care home typically costs between £1,000 and £3,000 per week, depending on the level of care required, the type of home, and the location.
The two main care settings for people with dementia are:
- Residential care covers accommodation, meals, and support with daily living. Fees typically start from around £1,000 per week.
- Nursing care includes 24-hour supervision from qualified nurses alongside personal care. Fees typically start from around £1,200 per week.
Care costs are generally higher in London and the South East and lower in the Midlands, the North, and Wales. Always ask care homes for a full written breakdown of fees, including any additional charges for specialist dementia services, one-to-one support, or continence provision.
For a broader overview of what care home fees cover and how they are structured, see our guide to understanding care home fees and your finances.
NHS Continuing Healthcare: When the NHS Pays Everything
NHS Continuing Healthcare (CHC) is a package of care fully funded by the NHS for people whose primary need is healthcare rather than social care. It covers all costs, including accommodation, with no means test applied.
Many people with advanced dementia qualify for CHC, particularly when they develop additional conditions such as epilepsy, swallowing difficulties, or require constant clinical supervision. Eligibility is assessed by a multidisciplinary team across twelve care domains including cognition, behaviour, nutrition, continence, and medication management.
If CHC is awarded, the NHS pays the care home directly. The individual and their family pay nothing.
Fast-Track CHC for End-of-Life Dementia Care
People with dementia who are approaching the end of life may qualify for fast-track CHC. A healthcare professional completes a fast-track tool, and the Integrated Care Board must arrange funding within 48 hours. This bypasses the standard 28-day assessment process entirely.
"Families are often unaware that CHC funding exists until it is almost too late to apply. If your loved one's dementia has progressed significantly, or they have developed additional health conditions alongside it, request a CHC assessment as early as possible. It can make an enormous difference."
For a full explanation of the CHC assessment process, see our guide to NHS Continuing Healthcare for care home residents.
NHS-Funded Nursing Care
Even if someone does not qualify for full CHC, they may still receive NHS-Funded Nursing Care (FNC) if they are living in a nursing home. This is a contribution paid directly to the nursing home to cover the cost of registered nursing input.
The current FNC rate is £235.88 per week (2024/25, England). It is not means-tested and is paid regardless of whether the individual self-funds the remainder of their fees. For more detail, see our article on navigating NHS nursing care funding.
Will the Local Authority Help Pay for Dementia Care?
If your loved one does not qualify for CHC or FNC, the local authority carries out two separate assessments.
Step 1: Care Needs Assessment
A social care professional visits to assess the level of care required and whether a care home is the most appropriate setting. You can arrange this through your local council. This assessment is free and does not depend on finances.
Step 2: Financial Assessment (Means Test)
Once a care home is confirmed as the right option, the local authority assesses your loved one's income and capital to determine their contribution.
The upper capital threshold in England is £23,250. Above this level, the individual funds their own care. Below it, the local authority contributes on a sliding scale.
Key points about the means test:
- The family home is excluded from the assessment if a spouse, civil partner, or dependent relative still lives there.
- Income such as pension payments is included in the assessment, though individuals retain a Personal Expenses Allowance (currently £30.15 per week in England).
- Savings and investments count toward the capital threshold.
- If capital falls below the threshold during the course of care, the local authority steps in automatically following a reassessment.
For more detail on how the financial assessment works, our guide to paying for care home fees covers the process in full.
Self-Funding Dementia Care
If your loved one's capital exceeds £23,250, they will initially need to self-fund. When researching care homes, ask for written confirmation of:
- The full weekly fee and what it includes
- Any charges that sit outside the standard fee
- The policy on annual fee increases
- What happens if funds fall to the threshold level during the placement
It is also worth understanding the difference between residential and nursing homes before committing, as the level of care provided and the associated costs differ significantly. Our article on the difference between care homes and nursing homes explains this in plain terms.
Top-Up Fees
If your loved one prefers a care home that costs more than the local authority's standard rate, a family member or third party can pay the difference as a top-up fee. The local authority continues to fund its portion, and the top-up covers the gap. For a full explanation, see our article on care home top-up fees explained.
Benefits That May Help With Dementia Care Costs
Several benefits may be available to people with dementia, regardless of whether they are self-funding or receiving council support:
- Attendance Allowance for those aged 65 and over who need help with personal care or supervision due to a physical or mental disability, including dementia.
- Personal Independence Payment (PIP) for those under 65 with a long-term condition affecting daily living or mobility.
- Pension Credit to supplement weekly income for those over State Pension age.
- Carer's Allowance for family members providing at least 35 hours of care per week.
Our article on benefits you can claim as a self-funder sets out what is available and how to apply.
What Counts as Deprivation of Assets?
Deprivation of assets occurs when someone deliberately transfers or spends money or property to reduce the amount counted in a care funding assessment. Local authorities can treat the asset as still owned and assess accordingly. There is no time limit on how far back they can look.
This includes gifting property to family members, making large cash transfers, or spending savings in ways that appear designed to reduce assessable capital ahead of a care needs assessment. The rule sometimes referred to as the "7-year rule" applies to inheritance tax, not care fees. There is no equivalent safe period for care funding purposes.
For a full explanation, see our dedicated article on deprivation of assets and the separate guide on what is the 7-year rule for care home fees.
"One of the most common misconceptions we hear from families is that transferring a property seven years before entering care makes it safe from assessment. That applies to inheritance tax, not care fees. The rules are quite different, and the consequences of getting it wrong are significant."
When Care Needs Change
Dementia is progressive, and care needs typically increase over time. A person who initially needs residential care may later require nursing care. Each transition requires a fresh assessment of both care needs and funding eligibility.
If someone's condition deteriorates significantly, they may become newly eligible for NHS Continuing Healthcare even if they were not eligible at the point of first assessment. It is worth requesting a reassessment whenever there is a meaningful change in health or behaviour.
For guidance on what to expect as dementia progresses, see how quickly does dementia progress and our article on moving care homes for someone with dementia.
Frequently Asked Questions
Are family members responsible for dementia care home fees?
No. Family members have no legal obligation to pay care home fees unless they have signed a contract agreeing to do so. The financial assessment is carried out on the person with dementia, not their relatives.
Does owning a home affect dementia care funding?
The property is excluded from the financial assessment if a spouse, civil partner, or dependent relative still lives there. If the property is empty, it will typically be included as a capital asset after a 12-week disregard period. See our article on can my daughter continue to live in my house if I go into care for more detail.
What happens when self-funding runs out?
The local authority carries out a new financial assessment and begins contributing once capital falls below £23,250. Most people in established placements continue in the same home while funding transitions. Our guide to what happens when self-funding for a care home runs out explains the process step by step.
When should someone with dementia move into a care home?
There is no single answer, but our guide on when someone with dementia should go into a care home sets out the signs to look for and how to have the conversation with your loved one.
Where do I start in arranging dementia care?
The first step is a care needs assessment from your local authority, which is free and determines what level of care is required. Our guide on where to start in arranging care walks through the process from the beginning.
