Adult social care charging changes consultation

Proposed residential care changes to adult social care charging policy

Consultation closed: Monday, 20 April 2020

Deferred payment agreement (DPA)

What happens at the moment

  • when someone goes into a care home, we can agree a deferred payment, which means we will get the costs back for the person being in a care home, once the person’s property has been sold
  • if a person chooses not to sell their property, they can delay the cost of paying for their care by entering into a loan (DPA) with us. When the property is sold, they then repay the money
  • a deferred payment agreement cannot be made if:
    • the person has lost capacity and has no legal representative
    • the property is not registered
    • the property is in the process of being sold and there is no other short-term arrangement to cover the care home fees
  • in any of these situations, we will support a person, so their care home placement is not a risk however this generates a cost for us

What is being proposed and why

  • the proposal is to introduce an interim funding agreement for those people who are in the process of arranging a deferred payment agreement, but have not yet been able to make this
  • this agreement will include a set up charge, annual fee and interest charges, which are currently:
    • set up fee: £642.20
    • annual admin fee: £105.90
    • rate of interest: 1.45% (set by central government)
  • people who enter into an interim funding agreement will not incur a second set up charge when the deferred payment agreement is finalised
  • introducing these charges will help us to recover some of our costs and make the process fairer for those people who have already entered a deferred payment agreement

The 12-week property disregard period

What happens at the moment

  • if someone moves into a care home permanently and has less than £23,250 in savings, we must not include the value of their home in their financial assessment for 12 weeks (this is called the 12-week property disregard period)
  • during this time, we will pay for a person’s care home fees unless their property sells within that time (the person may still be asked to contribute towards care fees based on their income and savings)
  • this gives a person time to get their finances in order and arrange the sale of their property or for it to be rented

What is being proposed and why

  • the revised policy proposes to apply the 12-week disregard when someone first goes into a care home on a permanent basis, rather than when they ask us for support to pay their care fees
  • this will affect a self-funder who may have been permanently living at a care home for some time, but can no longer pay the full cost of their care from their income and savings (the new proposals would mean they are not eligible for the 12-week disregard period)
  • generally, people in this situation have had long enough to arrange the sale of their house, or for it to be rented and should not need a period of disregard
  • in addition, people who have additional properties that are not their main residence will not be entitled to a 12-week disregard for the additional properties

What will not change under the new proposals 

  • we will continue to provide services to carers directly to meet their identified needs and will not introduce a charge for this
  • those in employment will not have their wages taken into account during their financial assessments, only the benefits they receive
  • we will continue to honour our support of ex-armed forces personnel and will not be taking into account war pensions in financial assessments

Everyone’s situation is different, so it is not possible to precisely calculate and share during the consultation stage the exact impact of the proposed changes for each person. However, appendix B and appendix C provide some detail of how the proposal to change the minimum income guarantee and disability-related expenditure could affect people.

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