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Care home top-up fees

A top-up fee can enable someone to live in the best care home for their needs, even if the local authority is not willing to meet the full cost of the chosen home.

In this article
What is a care home top-up fee? When can top-up fees be used? What you need to know before agreeing to pay a care home top-up
What are the rules for care home top-ups? NHS Continuing Healthcare and top-up fees What are the alternatives to top-up fees?

What is a care home top-up fee?

In some cases a local authority may agree to pay for a care home, but they’re not prepared to cover the full cost of your preferred home. A care home top-up fee is an extra payment that makes up the difference between what the council will pay and the full cost of your chosen care home.

The top-up is usually paid by a relative, friend or another third party. It’s sometimes called a third-party care home top-up.

When can top-up fees be used?

Residents usually can’t pay their own top-up fees (they shouldn’t be able to afford this if they’ve qualified for local authority funding), so it’s normally a relative, friend or, occasionally, a charitable organisation who might pay.

One of the few instances where a resident may be able to pay their own top-up fee is when they’ve entered into a deferred payment agreement.

The decision to pay a top-up fee is a voluntary one. There is no legal requirement for family members, friends or anybody else to meet this cost.

Here are some circumstances when a top-up fee could be appropriate:

  • You would prefer to live in a care home that costs more than the council is prepared to pay.
  • You want extra facilities, or a larger room or one with a better view, and the council funding does not cover this.
  • You’d prefer to live in a more expensive area to be closer to family or friends, but this wasn’t identified in your needs assessment.
  • You were previously self-funding, but subsequently become eligible for council funding. You want to stay in the same home, but the local authority believes your needs could be met in a less expensive care home.

Whoever agrees to pay the top-up fee will need to demonstrate they are able to pay the difference between the local authority budget and the care home’s actual fees.

What you need to know before agreeing to pay a care home top-up

Before agreeing to pay a care home top-up fee for a loved one, consider carefully whether you can afford the payment on an ongoing basis. Think about what would happen if your own circumstances were to change in future. Might this result in you being unable to afford the top-up?

Once you agree to pay the top-up, you’ll sign a contract and will then be legally obliged to make the payments at the agreed times.

Be aware of annual fee increases

If you’re considering paying a top-up, it’s important to be aware that when the care home increases its fees (usually annually), the local authority will not necessarily increase its standard rate by the same amount. This means the top-up fee could become more expensive.

What to do if you can no longer afford the payment

If you find you can no longer afford the top-up, either due to a change in your financial circumstances or because of rising fees at the care home, contact the local authority and the care home manager as soon as possible. The council should have set out in the contract (see below) how they would respond to a change in the funding of the top-up and what your responsibilities are in terms of letting them know of any change in circumstances.

What will happen if you stop paying the top-up?

If you stop paying the top-up fee, the local authority is not obliged to maintain your relative’s place in the more expensive care home. However, they may try to reach an agreement with the care home that would allow your relative to continue living there at a cost that fits the council’s standard budget. This could include moving to a less expensive room in the same home. If it’s not possible to come to such an arrangement, your loved one may have to move to an alternative home.

Before deciding what to do, the local authority should carry out a new needs assessment. As a part of this, the impact of moving your loved one to a new home – if this is necessary – will be taken into consideration. Until a decision is made, the local authority is responsible for paying the fees.

What are the rules for care home top-ups?

Whoever is paying the top-up fee will need to sign a written agreement with the local authority. This should include:

  • how much the top-up payment will be and when it is due
  • how often the payment will be reviewed
  • how the costs will be shared if the care home puts up its fees in the future
  • what will happen if the person paying the top-up fees can no longer afford it.

A top-up fee should always be agreed with the local authority. A care home should not demand that relatives pay a top-up fee. If they believe a top-up is required they must go first to the local authority.

If a top-up is agreed, it may be possible for the fees to be paid directly to the care home, but the council remains legally responsible for the full costs.

If a care home asks you to pay a top-up fee, ask them why they are doing this and then talk to the local authority. It’s the duty of the council to reassess a person’s needs and if the cost of care is going to increase, then the council should pay unless they can argue that the needs can be met elsewhere.

NHS Continuing Healthcare and top-up fees

There have been cases of care home providers requesting top-up fees for residents who are funded through NHS Continuing Healthcare (CHC). This practice is controversial. CHC packages should be sufficient to meet a person’s assessed needs in full. Therefore NHS-funded residents should not be asked to make additional payments to meet their their essential care needs.

Care homes may, however, charge for providing additional services outside of the resident’s care plan.

This issue has resulted in legal action against at least one major care home provider.

What are the alternatives to top-up fees?

A top-up fee is paid when the budget provided by a local authority is not sufficient to pay the fees of your preferred care home. If you believe this shortfall in funding is because essential care needs have not been included in your care plan, you should contact the local authority and request a new needs assessment

You will need to provide a reason to support your request. This might be that:

  • your circumstances have changed since the last assessment, or
  • you don’t accept the outcome of the assessment and you wish to challenge it.

Alternatively, if you think the personal budget set by the local authority is inadequate to meet your care needs, you can challenge this by making a complaint.

If you wish to challenge a local authority decision about your care needs or the funding available to meet those needs, read our article for guidance on your next steps.