Who Pays for Care Home Fees? A Plain-English Guide (2026)

Working out who pays for a care home is usually the first question families ask — and the one that causes the most worry. The answer depends on two things: how much money and property you have, and whether your care needs are mainly personal or mainly health-related. This guide sets out the three routes to funding, how the means test works, and what to do next.

What are the three ways care home fees get paid?

Almost every care home fee in England is paid through one of these routes, or a combination:

• Self-funding — you pay the fees yourself, usually because your savings, investments or property put you over the council's means-test threshold.
• Local authority (council) funding — after a financial assessment, the council pays some or all of the cost, and you contribute from your income and, in some cases, your capital.
• NHS funding — the NHS contributes towards, or fully covers, care where your needs are primarily health-related. This isn't means-tested.

Most people move between these over time. You might self-fund at first, then apply to the council once your savings fall towards the threshold. Or you might self-fund for personal care while the NHS pays a contribution towards nursing costs. See the NHS social care and support guide for an overview of how the system fits together.

How does the council means test decide who pays?

In England, the council looks at your capital (savings, investments and, in most cases, the value of your home) against two thresholds. These figures have been frozen since 2010, so always check the current amounts on GOV.UK before you plan around them.

Whatever your income and savings, the council must leave you a minimum weekly amount for personal spending, called the Personal Expenses Allowance. Scotland, Wales and Northern Ireland run their own systems with different thresholds and rules, so check with your own council or health board if you live outside England.

What counts as capital?

Capital includes savings, ISAs, shares, and — usually — the value of your home. But your home is disregarded from the means test if it's still occupied by your spouse or civil partner, a partner, a relative aged 60 or over, an incapacitated relative, or a child of yours under 18. There's also a temporary 12-week property disregard that applies while the council works out your longer-term situation, even if none of those exceptions apply.

How do I get a needs and financial assessment?

You don't have to work this out alone. The council must offer two free assessments if you ask for them:

1. Contact adult social services at your council and ask for a care needs assessment — you can also apply for a care needs assessment on GOV.UK.
2. Needs assessment — a social worker looks at what care and support you actually need, regardless of your finances.
3. Financial assessment (means test) — if you're found to need care, the council assesses what you can afford to contribute.
4. Outcome — you'll be told whether you're self-funded, part-funded or fully funded, and how much the council will pay towards an appropriately priced home.

Self-funding vs council-funded — what actually changes?

The route you're on affects your choice of home, what you pay, and what you need to arrange yourself.

Self-funders often pay more per week than the rate a council negotiates with the same home, because councils buy in bulk across many residents. It's worth checking a home's CQC rating and asking directly what a self-funder's rate would be compared with the council rate for the same room.

What is NHS Continuing Healthcare, and when does the NHS pay?

NHS Continuing Healthcare (CHC) is a package of care that's arranged and fully funded by the NHS, for people whose primary need is health-related rather than social. It isn't means-tested — eligibility depends entirely on the level and complexity of your needs, assessed using a national checklist and then a full Decision Support Tool. Ask your GP, hospital discharge team or the council to start a CHC checklist if health needs — not just personal care needs — are significant. See the NHS social care and support guide for how this fits alongside council funding.

If you don't qualify for full CHC but you live in a care home with nursing and need registered nursing care, you may still get NHS-funded Nursing Care (FNC) — a fixed weekly contribution paid directly to the home towards nursing costs. This is separate from, and smaller than, full CHC, and it's paid regardless of your means.

Will I have to sell my home to pay for care?

Not necessarily, and not immediately. Your home is disregarded from the means test while a spouse, partner, or certain relatives still live there. Even without that, the council must offer a 12-week property disregard from your first assessment, so the value of your home isn't counted for at least that long.

After that, if your home is counted as capital, the council can offer a Deferred Payment Agreement (DPA). This lets the council pay towards your care now and recover the money later — usually from the sale of your home after you no longer need it, or from your estate — so you don't have to sell in a hurry. Ask the council about a DPA before agreeing to sell anything.

What benefits and support can help with care costs?

A few benefits and legal arrangements are worth checking early, whichever funding route applies:

• Attendance Allowance — for people over State Pension age with care needs, whether or not you have a carer. It isn't means-tested and can be used towards care home fees.
• Pension Credit — tops up low income for pensioners and can open the door to other help.
• Lasting power of attorney (LPA) — set up for property and financial affairs, and for health and welfare, while the person can still make decisions. Without one, family members may need to apply to the Court of Protection to manage finances, which takes longer and costs more.
• Regulated financial advice — a SOLLA-accredited adviser can model how long savings will last and whether products like an immediate needs annuity make sense. MoneyHelper offers free, impartial guidance to start with.

What if my savings run out while I'm in a care home?

If you started as a self-funder and your capital falls close to £23,250, contact the council for a financial assessment before your funds run out completely. If you're assessed as eligible, the council will step in to fund your care going forward, though you may need to move to a home at their agreed rate if your current one costs more and no one can pay a top-up. Planning this conversation early — rather than waiting until money has gone — gives you more options and avoids a forced move under pressure.