How do top-up fees work?

Who calculates what I'm entitled to - and how?

Let’s assume you’ve had an assessment of care needs which has concluded you need a greater level of support than can be provided at home, and so you will have to move into a care home. In this instance your local authority will need to conduct a financial means test to determine whether you are entitled to local authority funding for care.

What is a ‘personal budget’?

If you do not have sufficient assets to be classified as a self-funder, your care fees will be paid by your local authority, who, following an assessment of your finances, will allocate a certain amount of money – known as your ‘personal budget’ to meet your needs.

You can challenge the sum allocated if you feel it to be unfair, but you will need to reference your care assessment and care plan to support your case.

It’s worth knowing that local authorities have been told by the government that they should not impose an arbitrary ceiling on care home funding which unfairly prevents people exercising genuine choice when considering different care homes. But in reality, it is very difficult to negotiate a larger personal budget from the local authority – their Care Home Selection team typically has a greater chance of success in negotiating reduced rates with care homes as they have many years’ experience and are familiar with many of the local homes. They often achieve substantial savings on behalf of the client.

Who manages my ‘personal budget’?

Once allocated to you, expenditure can either be managed by the local authority, by a third party (such as a care provider) or by you, if you are responsible for arranging and managing your own care providers. A family member or friend, assessed as suitable to manage your affairs, can be appointed to manage your personal budget under certain circumstances.

Direct payments are available to those who lack mental capacity, providing they have someone to manage them on their behalf – ie: someone with power of attorney and/or deputyship.

The amount of money in your personal budget is calculated according to your care needs assessment, a means-test, and the likely cost of your care needs. It can be reviewed if and when your needs change.

How does a top-up work?

As you might expect, relying on a personal budget calculated by the local authority, can create limitations in terms of choice of care home, but you can broaden your options if you have a relative or close friend who is prepared to contribute towards your care on an on-going basis. This is known as ‘topping up’.

You cannot make top-up payments yourself, nor can the care home request it, and there are always thorough checks made to ensure the efficacy of any payments by a third party. A top-up payment can make a considerable difference in the care home accommodation you receive; it needs to bridge the gap between the fees charged by the care home, and the sum that the local authority is prepared to pay.

Examples:

1. You want to live in a care home where the fees exceed what the local authority is prepared to pay – or you want a larger room, or additional extras which raise the weekly fee beyond what the LA will pay.
2. You want to ensure that you are living as close as possible to family and friends but there isn’t a care home option within the area with fees within the local authority’s limit.
3. You particularly want to be within a care home that reflects your cultural or religious needs and there is not one within the fee limit set by the local authority.
4. You are looking for a care home that meets very particular medical needs.

Having been self-funding, you are now eligible for local authority funding, but you don’t want to move from the care home where you are living, and where the fees are higher that the LA will pay.

Decisions, implications and contracts

Any decision made by a third party to provide top-up fees has to be voluntary – there is no legal obligation to do so. However, the person providing the top-up will need to demonstrate that they are financially able to pay the difference in the fees charged and the rate offered by the local authority.

They should also be aware that when the care home increases its rates – usually annually – the local authority may not increase its contribution.

In addition, they will need to enter into a contractual agreement with the local authority, and will most likely pay the top-fees to them, rather than directly to the care home.

Any written agreement between the benefactor and the local authority should cover the following points:

• Confirmation of the sum involved – how much the regular top-up will be
• Frequency of review (typically annually)
• Allocation of costs in the event that the care home raises its fees
• What should happen if the person paying for the top-up is no longer able to do so.

Depending on the needs of the potential resident, the care home could appeal to the local authority and request a reassessment of needs on the grounds that the cost of care is going to increase and the council should be responsible for paying at least some of the increase.