What to do if money runs out to pay for elderly care?

If the money your parent has been using to pay for your long-term care is running out, what are your options?

Who can you turn to for financial support, and what could happen to you if you’re in a care home? Here’s what you need to know:

First steps – ask for an assessment

Before you do anything, arrange for a care assessment – you might find that your parent is now eligible for local authority support. The assessment could show that their care needs now mean they need a place in a care home. Alternatively, they might be offered a home care package, or a place in sheltered housing or similar accommodation

Next you’ll need to arrange a financial assessment to see whether your parent qualifies for funding. This will look at their income, savings and assets. It might show that they no longer need to fund their own care

Depending on the outcome of the assessments, your parent may still need to pay some of their care costs, so it’s important to make sure they’re getting all the benefits and tax credits they’re entitled to

Are you eligible for NHS Continuing Care?

This could cover accommodation costs if the care is provided in a care homeIf your parent is assessed as having a ‘primary health need’, they have a complex medical condition, or they have substantial and ongoing care needs, they might qualify for NHS Continuing Care funding. It covers personal care and healthcare costs, such as paying for specialist therapy or help with bathing or dressing. It may also include accommodation if the care is provided in a care home, or support for carers if you’re being looked after at homeIf your parent’s increased costs are due to worsening health or injury, they might now qualify for this free support. There’s also a chance that the eligibility criteria have changed since you were last assessed. You might not even have heard about this type of funding before. Either way, it’s definitely worth talking to your doctor, carer or social worker

Are you eligible for NHS Continuing Care funding?

Will your parent be able to stay in their care home?

No one wins if the money runs out. There are always options to keep them in a place that meets their needs

You first need to check the contract with the care home. Some care providers will let your parent stay while you apply for funding, and they might accept a lower rate from your local authority so your parent wouldn’t have to move out

These days, the amount local authorities pay is usually a lot less than care homes charge. If your parent can’t make up the shortfall in some way, such as getting friends or family to top up their contribution, they might have to move to a cheaper or shared room, or into another care home which accepts the local authority funding as full payment

If your parent does qualify for local authority funding, they’re not allowed to top up their care-home fees from their capital. The money must come from a third party

What if your parent owns property?

If your parent is a homeowner, moving to a smaller property could free up the money they need to pay for their care Moving somewhere better suited to their needs might also improve their quality of life and bring them closer to friends and relatives

Downsizing your home to fund your long-term care

Your parent can use the value of their home to help fund care in other ways too, for example through equity release, in which case they wouldn’t have to move at all

Will your parent be able to stay in their care home?

First check your contract with the care home. Some care providers will let you stay while you apply for funding, and they might accept a lower rate from your local authority so you wouldn’t have to move out.

These days, the amount local authorities pay is usually a lot less than care homes charge. If you can’t make up the shortfall in some way, such as getting friends or family to top up your contribution, you might have to move to a cheaper or shared room, or into another care home which accepts the local authority funding as full payment.

If you do qualify for local authority funding, you’re not allowed to top up your care home fees yourself from your capital. You will have been financially assessed to pay what you can afford.

If the local authority suggests a place that meets your needs and you still want to move into a more expensive home, you can ask a third party (usually a relative or friend) to pay the extra. This is called a ‘third party contribution’.

Call Turn2Us on 0808 802 2000 to find out about charities or benevolent funds that might be able to help with top-ups.

Are there any short-term solutions to the problem?

If family or friends are unable to top up parental payments and they still own a home which they’ve left empty, you could consider these options:

12-week Property Disregard

Their local authority might help with the first 12 weeks of care-home fees if:

• their capital, excluding property, comes to less than the capital threshold for long-term care, and
• income doesn’t meet the care-home fees

Deferred Payment Agreements

After the first 12 weeks, any financial assistance your parent’s local authority provides can be regarded as a loan against the value of their former home and repaid from its eventual sale

This article is provided by the Money Advice Service.