NHS CHC vs LA-Funded Care vs Self-Funder

Who pays for care turns on two separate questions asked in a particular order. First, are the person's needs primarily health needs? If so, NHS Continuing Healthcare covers the full cost, free and without any means test, including accommodation in a care home. Only if that answer is no does the second question arise: how much capital do they have, and does the council fund the care or does the family pay it all? Getting the order right matters enormously. This comparison sets out all three routes.

Tip: scroll the table sideways to see all columns →

Feature	NHS CHC	LA-Funded	Self-Funder
Who qualifies	Primary need is health-related (intense, complex, unpredictable, unstable)	Eligible needs under Care Act 2014 + capital below £23,250	Capital above £23,250
Means test	No — full free care	Yes — capital and income	N/A — pay all costs
Who pays	NHS (free)	Council plus contribution from your income	You pay full cost
Typical weekly cost to you	£0 (free)	Income contribution less PEA (£31.80/week)	£900-£1,500 residential / £1,100-£2,000 nursing
Choice of provider	NHS commissions; you have input	Council standard rate + top-up option	Full choice but pay any rate
Assessment	Checklist + Decision Support Tool (DST)	Care Act needs assessment	Self-arranged
Appeal route if refused	Local Resolution → NHS England Independent Review	Council complaint → LGSCO	N/A
Includes accommodation cost	Yes (free)	Yes (income contribution)	Yes (you pay)

CHC eligibility is much wider than commonly assumed. Many self-funders should be CHC-funded but never had an assessment. Always request a CHC checklist if the cared-for person has complex or rapidly changing health needs. Deferred Payment Agreements bridge the gap for property-rich, cash-poor self-funders.

Ask about NHS funding before anything else

Continuing Healthcare is the route families most often miss, and it is the only one that is genuinely free. It is not about a diagnosis or a label — it turns on whether the person's primary need is a health need, judged by how intense, complex, unpredictable and unstable their needs are. Plenty of people paying full care home fees from their savings would qualify, and have simply never been screened. Anyone can ask for a Continuing Healthcare checklist, and you do not need permission from a care home or a social worker to request one.

Complex, rapidly changing or unstable health needs? Request a checklist in writing before agreeing to fund anything privately.
Needs are social rather than clinical, with modest savings? Ask the council for a Care Act needs assessment and then a financial assessment.
Capital above the threshold? You will pay, but still get the council assessment — it records the eligible needs and starts the clock for when funding may begin later.

The costliest mistake is self-funding without ever being assessed. Councils are not obliged to fund an expensive placement you chose while paying privately, and Continuing Healthcare is rarely awarded retrospectively without a fight. Ask for both assessments first, even if you expect to fail the means test.

If a decision goes against you, both routes have appeals. Continuing Healthcare refusals go to local resolution and then independent review; council decisions go through the complaints process and then the Local Government and Social Care Ombudsman.

Frequently asked questions

How do I challenge a refusal of NHS Continuing Healthcare?

Ask for the full Decision Support Tool documentation and the reasons in writing, then request local resolution with the integrated care board. If that fails, apply to NHS England for an independent review. Focus your challenge on the four key characteristics — nature, intensity, complexity and unpredictability of need — rather than on the diagnosis, and give concrete examples from daily records. Many refusals are overturned. Charities specialising in this area can help you frame the argument.

Can the council make us sell the house?

Not for care at home, where the property is disregarded entirely. For a permanent care home move the value may be counted, but not while a partner, a relative aged 60 or over, or a dependent child still lives there. Where it does count, a deferred payment agreement lets the council pay the fees and recover them from the property later, avoiding a forced sale during the person's lifetime. Ask about deferred payments as part of the financial assessment rather than afterwards.

What is a top-up fee and who can pay it?

Where a council funds a placement, it pays a set rate for that type of care. If the family chooses a home charging more, someone must meet the difference — a third-party top-up, usually paid by a relative. The resident cannot normally top up from their own income or capital. Get the arrangement in writing, understand that fee increases apply to the top-up too, and be realistic about affording it for years, because the council must find a suitable alternative if it fails.

What happens when a self-funder's money runs out?

Contact the council about three months before capital reaches the threshold, not after. If the person qualifies, the council takes over funding at its usual rate for that care, and if the home charges more a top-up may be required or a move may be proposed. Approaching the council early gives time to negotiate with the home and avoids a rushed move. Keep records of the capital position, because the council will ask how the money was spent.

Related guides

NHS Continuing Healthcare

NHS Continuing Healthcare (CHC) is a package of ongoing care fully funded by the NHS for adults whose primary need for care arises from a health condition rather than social care needs. If you qualify, the NHS pays for all your care — including care home fees — with no means test. Eligibility is often misunderstood and many eligible people are never assessed. If the person you are asking about has a rapidly deteriorating condition that may be entering a terminal phase, the separate <a href="/care-later-life/chc-fast-track">CHC Fast Track pathway</a> bypasses this assessment and must be decided within 48 hours.

10 min

Care Needs Assessment Basics

A care needs assessment is a free evaluation carried out by your local council to find out what help you need with daily living. Anyone who appears to need care and support has the legal right to ask for one under the Care Act 2014, regardless of their financial situation.

6 min

Care Home Fees Overview

Care home fees vary widely across England, typically ranging from £700 to over £2,000 per week depending on the type of care, location, and quality of the home. Understanding what the fees cover, how council-funded rates compare to self-funder rates, and what top-up fees are can help you make informed choices.

7 min

The £86,000 Care Cap: What Happened and What Applies Now

The £86,000 lifetime cap on personal care costs was the centrepiece of the 2021 social care reform. It was legislated for, deferred twice, and then abandoned in July 2024 without ever coming into force. This guide explains what was planned, what actually happened, and — more importantly — the means-test rules that govern what you pay today.

9 min

Deferred Payment Agreement: How the Council Pays Care Costs Until You Sell

A Deferred Payment Agreement (DPA) is a loan from the local council that pays your care home fees while you keep your home — and is recovered from the eventual sale or your estate. It removes the pressure to sell a family home quickly under duress. DPAs are available to most homeowners in residential care. This guide explains who qualifies, the interest rate, and the alternatives.

9 min

Disclaimer

The information on this page was correct at the time of writing. Amounts, thresholds, and rules may change. Always check the latest official guidance.