Funding for Dementia Care: Everything You Need to Know

Funding for dementia care is an important consideration for many families as care needs begin to increase.

Dementia care is not free, and the costs can vary depending on the type of support needed. Understanding how care is funded, what support is available, and what you may be expected to pay can help you plan with more confidence.

Who pays for dementia care?

In England, who pays for dementia care depends on a combination of care needs and financial circumstances.

After an assessment, there are generally three possible outcomes:

The local authority pays for all of the care
The cost is shared between you and the local authority
You pay for all of your care, known as being a self funder

Most people will contribute towards their care costs, with the amount based on a financial assessment.

Care needs assessment

The first step in accessing funding for dementia care is usually a care needs assessment from your local authority.

This assessment looks at:

What support is needed day to day
How dementia is affecting daily life
What level of care would be most appropriate

If the person is found to have eligible care needs, the local authority will create a care and support plan. This plan outlines what help should be provided and forms the basis for deciding how care will be funded.

Financial assessment

Once care needs have been established, a financial assessment will determine how much you need to pay.

This looks at:

Income, such as pensions
Savings and investments
Property and other assets

Based on this assessment, the local authority will decide whether you qualify for funding and how much you are expected to contribute. Some people will receive full funding, while others may need to pay part or all of the costs.

Types of funding available

There are different types of funding that may help with dementia care costs.

Local authority funding

If you meet eligibility criteria, your local council may contribute towards the cost of care.

This is usually means tested and depends on both your financial situation and care needs.

NHS funding

In some cases, care may be funded by the NHS.

This includes NHS Continuing Healthcare, which is available to people with more complex or long term health needs. Unlike local authority funding, this is not means tested.

Benefits and allowances

You may also be entitled to financial support through benefits, such as:

Attendance Allowance
Personal Independence Payment

These benefits are not means tested, which means they are based on care needs rather than income or savings. This makes them an important source of financial support for many families.

What care is free?

Some types of care and support are provided free of charge, regardless of financial circumstances.

These can include:

NHS services
Small home adaptations under a certain value
Short term reablement care following illness or hospital discharge
Aftercare provided under specific mental health legislation

Understanding what is available at no cost can help reduce overall expenses. The NHS offers a helpful guide to get you started.

Do you have to sell your home to pay for care?

This is a common concern for many families.

Whether a home is included in a financial assessment depends on the type of care being received and individual circumstances. In some cases, particularly with care at home, the property may not be included in the assessment.

It is important to seek advice to understand how this may apply to your situation.

Planning ahead for dementia care

Dementia is a progressive condition, which means care needs are likely to increase over time.

Planning ahead can help you feel more prepared and give you greater control over future decisions. It also allows you to explore options at your own pace, rather than making choices during a time of stress or urgency.

Planning early can help you:

Understand potential future care costs
Explore funding options and financial support
Make informed decisions about care at home or other settings
Involve your loved one in decisions while they are still able to express their preferences

It can also be helpful to consider practical steps such as organising finances, discussing wishes with family members, and looking into legal arrangements.

Having these conversations early can make the process less overwhelming and help ensure that care decisions reflect what is most important to your loved one.