ANDREW CARRIGAN, trusts and estates solicitor with Ashfords, examines the world of means testing.
WHETHER you receive care in your home or a residential setting, the council's Financial Assessment and Benefits (FAB) team will perform a means test to decide what you should pay towards that support.
The first question they will ask is ‘Do you have savings over £23,250?’ What counts as savings is complex and some types of asset will be disregarded. Bank accounts and most forms of investment are definitely included but if you have more complex finances – for example if you run a business or own buy-to-let properties – you should seek advice.
The basic rule is that if you have assets worth more than £23,250 you will have to meet your own care costs (self-fund).
If your savings are between £14,250-£23,250 you will be assumed to have a weekly income of £1 for every £250 of savings in excess of £14,250. This ‘assumed’ income is added to any other regular payments you receive.
The treatment of income by the means test depends on whether you receive care at home or in a residential setting.
If you receive care at home the FAB team will ask for details of income/outgoings and calculate how much you can afford to pay toward the costs of your care.
If you are in residential care all your income is considered available to meet your care costs with the exception of £24.40 a week (the Personal Expense Allowance).
If you have other demands on your income, regulations set out how they should be taken into account. For example, the council has discretion to increase your Personal Expense Allowance so you can support dependants.
If you self-fund, you can make your own care arrangements and negotiate the price. However, if you receive financial support from the council they will not fund care at a higher price that they could obtain it. Each council sets a maximum weekly price for residential care in their area. Somerset has set that at £433.88 per week.
If you choose a home that costs more, but your savings are less that £23,250 someone will have to sign a Third Party Top Up agreement. This means a friend/family member agreeing to meet the difference between what the council will pay and the amount the home charges.
EXAMPLE – moving from self funding to council funding
YOU live in a residential home that charges £600 a week for an en suite room. Your savings have dropped below £23,250. Your income is £400 a week.
The local authority will not fund a room with a value of more than £433.88 a week. You will need to move to a smaller room, or another home, or identify a friend or relative willing to make up the ‘gap’.
There are ways to challenge this and the assessment process in general but that is beyond the scope of this feature. If you need advice, many voluntary organisations provide information and support on this topic. We also offer a fixed price assessment that will consider your circumstances and whether – and, crucially, for how long – you will be self-funding. Please do get in touch if you think we might be able to assist.