Wayne Barnett FCA | MIPW | STEP Affiliate
England's Social Care Cap Explained
Updated: Mar 15
British Prime Minister Boris Johnson announced a hike in National Insurance to invest more in health and social care. As well as boosting NHS spending, the money will be used to pay for a cap on the costs people face if they require social care in England. This includes help at home or a move into a care home.
The plan is that from 2023 no-one will pay more than £86,000 for the care they need. The Government says 'no longer will people rack up "catastrophic" costs'. However, much will depend on your individual circumstances, which Maplebrook Services is happy to review and advise how you may best protect your assets.
Is the social care cap smoke and mirrors?
The daily living costs in a care home, those associated with food, energy bills and accommodation, will not count towards the cap. This can be in the region of £36,000 + per annum which is not covered.
It has been suggested by previous incarnations of the cap that people's contribution to these living costs should be fixed at £12,000 a year. In many ways, this is understandable, they would be liable for living costs if they remained in their own home. But based on the average care home cost of £36,000 a year, only £24,000 of the spending counts towards the cap once those £12,000 living costs are removed. The problem is, it would take the average care home resident more than three and a half years to hit the cap but not many residents live that long with three-quarters not seeing past three years. Not forgetting that care you receive in your own home will count towards the cap yet this tends to cost much less and therefore people would normally need to be in receipt of that care for many years to hit the cap.
Furthermore, only the very frailest of people normally qualify for eligibility by the local councils after assessment. Councils worry the money being raised by the National Insurance hike will be largely swallowed up covering the cost of the cap and funding the NHS.
To find out how Maplebrook Services may be able to help you protect your assets from future care home costs contact Wayne Barnett on email@example.com, by phone on 99 147650 or by submitting the contact form at the bottom of this page.