- What is charging and financial assessment??
- What are the main principles?
- Who is involved?
- What are capital limits?
- What are the different types of financial assessment?
Under the Care Act 2014 there is a framework – or structure – for charging for care and support services. This allows the local council to decide whether or not it should charge a person for care and support services that they need, or that a carer needs. A financial assessment is carried out to find out who should pay toward their care and who should receive free services. This depends on their income and financial assets, such as savings or owning a house.
The financial assessment will decide whether the council must arrange someone’s care and support free of charge, or if the person has to pay for the services they receive. This applies whether the council is delivering the care and support directly itself, or through another provider.
The main principle which guide the decisions around charging and financial assessments is that people should only have to pay what they can afford.
But charging and financial assessments should also take into account a number of other principles. These include:
- being clear and transparent, so people know what they will be charged;
- promoting people’s wellbeing, social inclusion, individual choice, independence, and control;
- supporting carers to look after their own health and wellbeing and care effectively and safely;
- being person-focused and reflecting the different care options available to meet a person’s needs;
- making sure that people with similar needs are treated the same and reducing the differences between care settings;
- encouraging and enabling those who wish to stay in or take up employment, education or training to do so.
The following people will be involved in a financial assessment:
- the adult who is needing care and support services;
- a family member, friend or unpaid carer, to support the person;
- a social worker or finance team officer who will carry out the assessment.
If a person does not have mental capacity to take part in the assessment and therefore does not understand the issues being discussed, the council must find out if there is:
- someone with power of attorney for the person;
- someone who has been appointed a deputy for the person by the Court of Protection; or
- any other person dealing with the person’s affairs.
When carrying out a financial assessment, there are two types of capital limit: upper limit and lower limit.
The upper capital limit is currently set at £23,250. If a person has capital below this level (in either money or assets, such as a house), the council can do a financial assessment and make a charge for services based on what they can afford to pay. If the person has above the upper capital limit, they have to pay for all the care and support services they receive.
Where a person’s cash and assets are below the ‘lower capital limit’ of £14,250 they will not need to contribute to the cost of their care and support. However, for adults receiving care and support somewhere other than in a care home (such as from a care provider in their own home) the council can set its own capital limits, within guidelines.
Please note that these limits are set to change in October 2023, known as the ‘cap on care costs’.
There are two different types of financial assessment that the council can carry out so that it knows whether a person can afford, and will be able to continue to afford, any charges they may have to pay. These are 1) a light touch assessment and 2) a full assessment.
A light touch assessment involves gathering enough financial information for the council to prove that the person or carer:
- meets the criteria (known as being eligible) to receive financial support from the council; or
- does not meet the criteria (not eligible) for full financial support from the council.
It does not involve gathering a lot of information, usually because someone’s finances are quite straightforward and only come from a few sources.
A full financial assessment involves gathering more detailed information about the person’s or carer’s capital and income. Examples of when a full assessment may be required include:
- when the person or carer is not clear about their level of income and capital;
- if the council thinks that a person is not declaring all their resources (that they are hiding some with relatives for example);
- where the level of their capital is between the upper and lower capital limits, a full financial assessment is needed to be sure about whether they are eligible to receive financial support from the council.