Historically, local authorities had wide discretion around charging and there were a minimum of national rules. Prior to 1994, the only information from government to go on, in structuring a policy was to be found in a letter of advice from the SSI stretching to a few paragraphs which were not even clear in themselves. In January 2001, the DoH issued a piece of draft guidance relating to charging policies for non-residential social services, aimed at helping authorities ensure that charging policies are fair as between all client groups and that the promotion of independence and social inclusion of service users is not undermined by poorly designed charging policies.
The Care Act 2014 has further developed the framework around charging for social care services.
Rather than “reasonableness”, the legal rule is now that “When choosing to charge, a local authority must not charge more than the cost that it incurs in meeting the assessed needs of the person.” (Guidance 8.15 reflecting s.14 & 17 Care Act). So the charge MUST NOT exceed the actual cost.
There remains some degree of local discretion however. Options include:
• Increasing Minimum Income Guarantee or Charging a percentage of disposable income
• Charging Carers
• Disregarding additional income (e.g. disability benefits or spending on prevention)
• Setting maximum charges
In setting policies local authorities should consider:
• Not charging more than it is reasonably practicable for people to pay;
• Minimising variation
• Transparency
• Promoting wellbeing, social inclusion, personalisation, independence, choice
• Supporting carers
• Sustainability for local authority
Guidance 8.45
Some consideration is still given to the impact on of the charge on the person, however this is weaker than the previous ‘reasonableness’. “The overarching principle is that people should only be required to pay what they can afford.” Guidance 8.2
The intention of this discretion is to provide opportunities to promote wellbeing, improve prevention and other policy priorities: ““local authorities … may choose to disregard additional sources of income, set maximum charges, or charge a person a percentage of their disposable income. This will help support local authorities to take account of local circumstances and promote integration and innovation.” Guidance 8.43 (also see 8.47 & 8.48)
Caution is needed on the idea of setting charges on the basis of percentage of disposable income without safeguards – but the maximum LA’s are allowed to charge is the actual cost!
The guidance does emphasise that aftercare services provided under s117 MHA 1983 may not be charged for and that advice about services, advocacy and assessment and care planning themselves, are not chargeable functions.
Only services provided to meet needs (eligible or not) can be charged for under s.14. Charges are subject to financial assessment of the person’s means. For non-res, an individual’s income must not be reduced below the Minimum Income Guarantee (generally speaking Income Support + 25%). However, this can be exceeded for “non-care related support”
“Where a local authority provides non-care related support for the adult concerned the minimum income guaranteed amount in relation to that adult is the amount … less an amount equal to the cost the local authority incurs in providing that non-care related support for the adult concerned.”
“non-care related support” includes support which consists of services or activities such as the provision of meals on wheels, shopping or transport services or recreational activities.Reg. 7
The policy intent here is to ensure that adults with needs for care and support are not being provided for free with things that others would normally pay for (e.g. food or transport). However, councils should seek to ensure that those with particular types of needs are not forced to pay significantly more for such costs than those without needs for care and support would be paying. (with an eye to the Public Sector Equality Duty).
Preventive services may also be charged for (under s.2) Only actual cost incurred (so if you haven’t spent any money – you can’t charge). One cannot charge for exempt services ie 6-week reablement and equipment. Financial assessment is NOT necessary for these charges as they are assumed to be nominal charges. Whether to charge for preventive services is a policy decision and the pros and cons need to be weighed carefully with an eye to the impact on the likelihood of increasing costs elsewhere in the system if charges are too high.
If care and support are to the adult, the carer MUST NOT be charged – s14(3) and Guidance 8.49
Carer may be charged for support provided for their own life eg childcare for their children, housework to allow them to keep their own home ‘habitable’, as well as support in their caring role
However the guidance does point out the potential downsides to charging carers for support:
“Local authorities are not required to charge a carer for support and indeed in many cases it would be a false economy to do so. “
“It may be that there are circumstances where a nominal charge may be appropriate, for example to provide for a service which is subsidised but for which the carer may still pay a small charge, such as a gym class. Ultimately, a local authority should ensure that any charges do not negatively impact on a carer’s ability to look after their own health and wellbeing and to care effectively and safely.” Guidance 8.50
The guidance is, in most areas, broadly in line with previous policy in encouraging:
• Charges for meals at home or in day-care – on the basis that everyone has to eat
• Keeping users’ incomes above basic income support levels and having regard to the level of disposable income after the charge
• Setting a buffer of 25% or more above income support personal allowances and premiums to provide a safeguard in ensuring incomes are not reduced below basic levels
• Ensuring that charging policies do not deter choice by creating perverse financial incentives in favour of particular forms of care (e.g. care homes)
· Excluding earnings from financial assessment to avoid deterring employment
• Consultation with users and carers on charging policies
Financial assessment
A financial assessment MUST be carried out before charges can be imposed under s.14 (s.17 Care Act). And a financial assessment can only be carried out where an adult has been assessed as needing chargable services.
However, a ‘light touch’ financial assessment (Charging reg. 10 Guidance 8.23, 8.27) is possible where:
· the adult consents (so must have capacity or legally empowered person) and confirms they are willings to pay resulting charges
· For services with nominal fees which are affordable (where it would be disproportionate)
· Where clearly under the limit e.g. means tested benefits
· Where adult accepts over the limit and doesn’t want to go through assessment
And preventive services with nominal charges can be charged for without a financial assessment (s.2).
Where a capacitated adult refuses a financial assessment or refuses to co-operate an authority is to be treated as having carried out a financial assessment (reg.10)
The LA does not have the power to assess partners and so must only assess financial resources of the individual themselves Guidance 8.8 This resolves the previous confusing and ambiguous situation.
A written record of the financial assessment must be provided S.17
Must ignore:
– Earnings (Charging reg. 14)
– housing costs – Charging reg. 27 & 28 (in schedule 1)
– disability-related costs if disability benefits taken into account – Charging reg. 29 (in schedule 1)
– Disability related costs include community alarm systems, privately arranged care and specialist items. The term ‘include’ means that these are not LIMITED to those items. Charging and Assessment of Resources reg. 29
– “where a person receives benefits to meet their disability needs that do not meet the eligibility criteria for local authority care and support, the charging arrangements should ensure that they keep enough money to cover the cost of meeting these disability- related costs.” Guidance 8.42
The case law on DRE will still be valid
In R (Stephenson) v Stockton-on-Tees Borough Council [2004] court considered policy where money paid to family carers was disallowed as DRE and treated as still possessed by the service.
The court found that the POLICY was NOT irrational or perverse because (in this case) Mrs Stephenson’s expenditure was something she chose to incur, instead of absolutely needing to pay, in order to get the care she wanted, so it was not an expenditure of the sort envisaged by the guidance. That meant councils could have this kind of a policy, in theory.
BUT the court of appeal found that Stockton had treated its policy as a rule, and never genuinely considered whether this was an exceptional case. The Court of Appeal thought it was exceptional, on the facts.
Cornwall – another case of use to service users and families
B had moderate learning disability and a history of challenging behaviour. He came off CHC and was assessed for social care. Initially his contribution was assessed as nil. But a paper review of inconsistent application of DREs led to his contribution being reassessed to £68.50 per week.
The court found that baldly refusing to accept certain heads of expenditure as DRE, was unlawful.
The court also found that “the authority could not, on the one hand, identify care needs within the care plan then, on the other, determine that because of a lack of evidence available these needs would not be met, if they had also failed to offer B and his parents the opportunity to provide the necessary evidence. It was the Local Authority’s duty (under s47 NHSCCA) to fully assess a person’s needs and this responsibility could not be transferred to the applicant requiring him to provide evidence of his need.”
Key messages from these two cases
It’s fine to have a policy but it must not become an absolute rule. Don’t fetter discretion.
Councils can’t expect service users to take responsibility for fulfilling the council’s statutory duty to assess.
Need to have some sort of internal review or appeal system to make it possible for people to make a case that you should make an exception to the policy.
Must look for and properly consider needs which a service user may be meeting by means of DRE (including evidence of this in the Care Plan itself!)
The recommended list in the guidance (Annex C) extends beyond that which would be identified on the care plan (eg above-average heating costs) as a need. It mentions payment for community alarm systems, privately arranged care services, including respite care, special costs caused by the disability such as laundry, dietary products, clothing, footwear, wear and tear, the cost of domestic help, if necessitated by the disability and not met by social services, and the cost of equipment, including equipment or transport needed to remain in work.
In setting the actual level of the charge, the guidance says “must not charge more than the cost that it incurs in meeting the assessed needs of the person.” (8.15). This is welcome clarification from the previous uncertain position. However it does create some new difficulties.
This could make a real difference to those who live half way up a fell-side or those for whom nobody wishes to accept a contract for services.
In real life, a person who has a carer to supply night sitting for free will have a broader range of options open to them than the client who has no-one. The cost of meeting the latter’s needs at home will be greater than for the former. But this is because the existence of the carer has gone towards reducing the size of the care package, before the charge is even calculated.
However, where someone lives further away than is normal, or lives on a rough estate where LA staff are only allowed to go in pairs after dark, or someone’s weight requires 2 to lift rather than one, we do not think that it is consistent with equitable care planning to do the cost comparison taking those additional costs into account – the needs remain the same. If a client makes it cost more than it need, by refusing to accept reasonable means of delivering the service, and insisting on something more expensive than is reasonable, however, that might be different. It is our view that whatever is required by way of lawfully meeting the need, including the cost of meeting duties to staff in terms of manual handling or risk management, should be regarded as the authority’s financial problem, and not the client’s – but there is no case law on this point as yet on this issue.
The new basis for charging clarifies that local authorities cannot charge people more than the service is costing the authority. Thus a client cannot be charged, if the authority has been put fully or partly in funds with which to purchase the service, by another body.
So those (sterile?) arguments about what is a health bath and what is a social care bath will still have to be thrashed out, if local authorities are going to continue to charge at all, for things commissioned from pooled budgets.
The bit we like most is the recognition in s.9 that The duty to carry out a needs assessment applies regardless of the authority’s view of the level of the adult’s financial resources. Financial assessment can be done alongside support planning but must not influence care planning decisions.
In theory, this should put a stop to the self-rationing urges of particularly the elderly client group who are encouraged to say that they will not accept the services being discussed as potentially needed, once they have been told how much they are likely to cost. The Hambidge case stressed that it is not good practice to offer re-assessment to clients in the context of reducing the cost of services, without at least pointing out that the authority has a duty to meet ‘assessed need’ in any event. The refusal of a service, once it is offered, discharges the authority from a duty to provide it, but fear of that cost in advance, should not be allowed to obstruct the proper and full assessment of need in the first place.