Understanding Who Pays for Dementia Care
Many assume that because dementia is a medical condition, the NHS will cover all associated care costs. However, in the UK, the funding responsibility for long-term care is split between the NHS (health needs) and local authorities (social care needs), and only certain circumstances lead to fully funded care. This article clarifies the different routes to funding and explains when and why a person with dementia may have to contribute to or fully pay for their care home fees.
The Importance of the Care Needs and Financial Assessments
The first step to determining who pays for care is a needs assessment by the local council. A social worker or another professional will evaluate the individual's needs to confirm that a care home is the most suitable option. If this is the case, a financial assessment (or means test) will follow to establish how much the individual can afford to pay.
Navigating the Local Authority Means Test
The financial assessment conducted by the local council is a crucial step for most people requiring social care. It looks at income and capital, such as savings, property, and pensions, to determine eligibility for funding.
- England's thresholds (for 2024/25):
- Capital over £23,250: The individual is a 'self-funder' and must pay for their care in full.
- Capital between £14,250 and £23,250: The individual receives partial funding, contributing an assumed 'tariff income' from their capital towards fees.
- Capital under £14,250: The individual will receive maximum support from the council, only paying what they can afford from their income.
It is important to note that these thresholds vary across the different nations of the UK and can change over time. The value of a person's home is generally included in the assessment, unless a spouse or dependent relative still lives there. Local authorities can also investigate deliberate deprivation of assets, where an individual has intentionally given away assets to avoid paying for care.
NHS Continuing Healthcare (CHC): A Route to Fully Funded Care
For some individuals with complex, ongoing health needs, the NHS may cover all care costs through NHS Continuing Healthcare (CHC). Unlike local authority funding, CHC is not means-tested and is free at the point of use.
Eligibility for CHC is based on having a “primary health need”, meaning the majority of a person’s care is required to address a health need rather than social care. The assessment focuses on the nature, intensity, complexity, and unpredictability of the individual's needs. Crucially, a diagnosis of dementia alone does not guarantee eligibility. A person must demonstrate that their condition leads to a significant and complex healthcare need.
NHS-Funded Nursing Care (FNC): A Partial NHS Contribution
If an individual resides in a nursing home and requires care from a registered nurse, but does not qualify for the full CHC funding package, they may still be eligible for NHS-Funded Nursing Care (FNC). FNC is a weekly, non-means-tested contribution from the NHS paid directly to the nursing home towards the cost of the nursing care component of the fees.
A Comparison of Funding Routes
| Feature | Local Authority Funding | NHS Continuing Healthcare (CHC) | NHS-Funded Nursing Care (FNC) |
|---|---|---|---|
| Funding Source | Local Council | NHS | NHS |
| Eligibility Basis | A person's financial situation (means-tested) AND social care needs. | A 'primary health need' based on care needs assessment. | Need for care from a registered nurse in a nursing home. |
| Means-Tested? | Yes. | No. | No. |
| What is Covered? | Partial or full cost of social/personal care (e.g., washing, dressing), depending on means test. | Full cost of care, including accommodation, personal and nursing care. | A set weekly contribution towards the cost of nursing care. |
| Accommodation Costs? | Can be covered, but subject to means test. | Included in the full package if care is in a residential setting. | Does not cover accommodation costs. |
The Impact of Dementia on Care Costs
Dementia is a progressive condition, and the level of care required often increases over time. Because of this, dementia care can be more expensive than standard residential care due to the need for specialist support and enhanced supervision. This can be a shock for families, and it is vital to understand the potential for rising costs during care planning. For more in-depth information, the Alzheimer's Society website is an excellent resource.
Planning for Future Care
Given the complexities and potential costs, proactive financial planning is essential. Seeking advice from a qualified financial advisor, particularly one specializing in later life care, can help families understand their options. Establishing a Power of Attorney early is also crucial, enabling a trusted person to make decisions on behalf of the individual with dementia if they lose the capacity to do so themselves.
Conclusion: A Summary of Your Funding Options
In summary, it is incorrect to assume that dementia care home fees are automatically covered by the NHS in the UK. The situation is complex and depends heavily on the individual's financial resources and the precise nature of their care needs, as assessed by health and social care professionals. While some may qualify for full NHS funding (CHC) or partial NHS contributions (FNC), many will find themselves subject to a means test by the local authority and required to contribute to or self-fund their care. Understanding these different pathways is the first step towards securing the appropriate care without facing unexpected financial burdens.
