Care home payment rules reviewed to avoid ‘bad debt’ risk to council

“Significant” levels of unpaid care home fees in Newport have prompted the city council to bring in new rules reducing its liability for debts.

A new report shows the issue is “particularly” problematic in some cases involving ‘self-funders’ – people who have assets worth more than a £50,000 threshold for subsidies.

Currently in Newport, it is the council that pays fees to care home providers and then asks to be reimbursed by the resident.

But this approach has increased the council’s risk of “exposure to non-payment” and can also “cause confusion about who holds responsibility for contracting and payment”.

The local authority plans to change the system so ‘self-funders’ are required to deal directly with their care home and pay the provider themselves, if they are willing and able to do so.

The council argues this will reduce its exposure to “bad debt” and will also make clear who is responsible for payments.

Separately, the council said some care homes may charge more than the council’s agreed payment rate, and the report notes the potential for “confusion” for families who are unsure whether it is their responsibility – or the council’s – to make up the difference.

A new change here will make clear that it is the resident or their relatives who are responsible for those extra payments.

If a payment is missed, the council may step in on a temporary basis to cover the costs until a “sustainable” solution is found, however.