How much will I have to pay for care? The Health and Social Care Plan explained

Many people are now asking themselves, “How much will I have to pay for care?” and it’s only natural to wonder what care will cost – whether it’s for yourself or your loved ones.

To help you get to grips with the now not so new Health and Social Care Plan, we’ve put together this explanatory post.

What is the proposed Health and Social Care Plan for? 

The proposed Health and Social Care Plan aims to do a number of things. They include:

• Supporting the NHS and reducing waiting lists
• Reforming social care
• Integrating health and social care more closely
• Protecting people against excessive care costs

You can read the full policy paper here for more detail.

What are the Health and Social Care proposals?

Firstly, from October 2025 (this was delayed from its original planned implementation date of October 2023 in the 2022 Autumn Statement), no eligible person starting adult social care will have to pay more than £86,000 for their personal care during their lifetime.

From the same time, no-one with assets worth under £20,000 will have to contribute to care costs from their savings or value of their home. The current cap is £23,250. However, people will be expected to make contributions from their income.

People with assets worth between £20,000 and £100,000 will be able to claim means-tested support. If the amount they can contribute out of income is deemed to be insufficient, they may have to contribute up to 20% of their chargeable assets annually. This will stop when the value of their assets drops below £20,000.

Anyone with assets worth over £100,000 will have to pay the full cost of their care. This continues until their remaining assets drop under £100,000, when the means-test kicks in.

It’s important to note though, that this reform has already been delayed once and may well be delayed again. The government seems to be making a habit of promising this change but then, just when we all think it’s finally happening, pushing it further out at the 11th hour. Will it actually ever arrive? One seriously has to wonder.

What else do I need to know?

The new plan covers personal care costs, but not living costs such as accommodation, food and cleaning.

The government also plans to unfreeze the Minimum Income Guarantee for people who receive care in their own homes. It will do the same for the Personal Expenses Allowance for people who live in care homes. Both of these rise in line with inflation.

Under the new system, you can still opt for a more expensive care service by topping up the difference in cost.

One flaw in the plan is that demand for care is likely to skyrocket after the £86,000 contributions cap is introduced in October 2025. This may lead some care providers – especially smaller ones – struggling until that point.

It’s also worth noting that, even under the new plan, it remains as important as ever to plan for your retirement and for passing on your assets to the next generation. If you would like any help with wills, trusts or legacy planning, do get in touch. We’d be delighted to help you.