Paying for care: funding, means tests and NHS CHC
How a care home is paid for depends on savings, assets, and the type of needs involved. This guide explains the system in England as it stands in 2026 — who pays, when the council helps, and the two routes to fully funded care that many families miss.
The capital thresholds
When someone needs residential care, the council carries out a financial assessment (means test) that looks at income and capital (savings, investments, and usually the value of a home). In England, two thresholds decide who pays:
| Capital | Who pays |
|---|---|
| Above £23,250 | You pay the full fee (a “self-funder”) |
| £14,250 – £23,250 | The council contributes; you pay a tariff from your capital |
| Below £14,250 | The council pays, keeping most of your income towards the cost |
Around half of care home residents are self-funders. These thresholds have been frozen for several years; a planned reform (including an £86,000 lifetime cap on care costs) was announced but has been delayed, so the figures above are what currently applies. Always confirm the latest position with your council.
Is the home counted?
The value of the person's home is included in the means test for permanent residential care — but not if a partner, or certain other dependent relatives, still lives there. A 12-week property disregard also means the home's value is ignored for the first 12 weeks of a permanent stay, and a deferred payment agreement can let you delay selling the home by letting the council place a charge on it instead.
Get a needs assessment first — it's free and separate
The care needs assessment (what care is needed) is separate from the financial assessment (who pays), and it's free to everyone regardless of wealth. Always get it, even as a self-funder: it defines the care required and can unlock council or NHS support you didn't know you qualified for.
NHS Continuing Healthcare — the route most people miss
If someone has significant ongoing health needs (not just personal care), they may qualify for NHS Continuing Healthcare (CHC). This is fully funded by the NHS — it covers the entire care home fee, and crucially it is not means-tested. Eligibility hinges on having a “primary health need”, assessed through a checklist and then a full multidisciplinary assessment.
CHC is significantly underclaimed. If health needs are complex, deteriorating, or unpredictable, ask the GP or hospital discharge team to arrange a CHC checklist assessment. Being turned down at the checklist stage can be challenged.
Funded Nursing Care
If someone in a nursing home doesn't qualify for full CHC but needs care from a registered nurse, the NHS pays a flat weekly Funded Nursing Care (FNC) contribution towards the nursing element of the fee. It's paid directly to the home.
What it costs before funding
Knowing the fees helps you plan. Our care home costs guide covers typical weekly fees in the North East and how they vary by area, and you can compare individual homes by browsing by town.