Dementia care funding.

The framing problem

Cancer treatment is free on the NHS. So is heart failure management, kidney disease care, and the management of every other major progressive illness. Dementia care is overwhelmingly not.

The reason is administrative rather than clinical. The NHS funds “healthcare”. Dementia care is mostly help with washing, dressing, eating, managing behaviour, and ensuring safety. Those tasks are classed as social care under the Care Act 2014, even though the underlying condition is medical and the person delivering the care is often a healthcare assistant.

This is the source of an enormous amount of distress. Families expect free NHS care, discover the system treats dementia as a social care problem, and find themselves paying £60,000 to £130,000 a year while watching the inheritance disappear.

Where NHS Continuing Healthcare applies to dementia

CHC eligibility is determined by the overall picture of need, not the diagnosis. Many people with dementia would qualify on need but do not on assessment because the documentation does not make the case strongly enough or because the local Integrated Care Board takes a narrow view.

The CHC case for dementia tends to be strongest where one or more of the following apply:

• Significant behavioural disturbance. Aggression, agitation, exit-seeking, or behaviours that risk harm to self or others. Behaviour is one of the 12 Decision Support Tool domains and can score Severe or Priority in advanced cases.
• Profound cognitive impairment with no ability to communicate basic needs, leading to high dependency on round-the-clock specialist care.
• Significant psychiatric symptoms such as delusional belief systems, persistent paranoia, or co-existing depression and anxiety requiring active specialist input.
• Complex physical needs alongside the dementia, particularly swallowing difficulties requiring modified diets or PEG feeding, frequent falls requiring two-person transfers, or complex medication regimens.
• Frequent crises where the person’s state can change rapidly and requires fast clinical response, including frequent hospital admissions.

Stable, calm late-stage dementia is harder to argue for CHC, even when the person is severely dependent. The Decision Support Tool rewards unpredictability and crisis, which can feel perverse from a family carer’s point of view.

The dementia premium on care home fees

Care homes typically charge a premium for specialist dementia placements. Reasons include higher staffing ratios, the cost of secure or EMI (elderly mentally infirm) units, more specialised training, higher staff turnover, and the need for purpose-built physical environments.

Typical dementia care home fees in 2024:

• Residential dementia care: £1,300 to £1,800 per week typical, £2,000+ in London
• Nursing dementia care: £1,500 to £2,200 per week typical, £2,500+ in London
• One-to-one supervision adds £400 to £1,000 per week on top where assessed needs require it

Annualised, a dementia nursing placement in the South East commonly sits at £100,000 to £130,000 per year. Care for the typical seven to ten years of progression after diagnosis often consumes the entire family home and savings.

What to ask about when looking at a placement

Beyond the standard care home questions, dementia-specific ones include:

• What is the staff turnover rate, particularly among care assistants who would build a relationship with the resident
• How are challenging behaviours managed without sedation
• What is the home’s policy on antipsychotic medication, given the evidence on overuse in dementia care
• Are there secure outdoor spaces and how often are residents supported to use them
• Are there activities specifically designed for people with cognitive impairment, including reminiscence and sensory activities
• What is the home’s relationship with the local NHS mental health team and the GP
• How is end-of-life care handled, given that most residents will die in the home

Funding routes for dementia care

The main routes, in priority order from a family finances point of view:

1. NHS Continuing Healthcare. Free if eligible. Worth pursuing properly even where the chance is uncertain because the upside is the entire bill being lifted. See what is CHC.
2. NHS-funded Nursing Care. £236.40 per week (April 2025 standard rate) contributed by the NHS toward any nursing placement, regardless of CHC. Automatic.
3. Means-tested social care. If assets are below £23,250 the council pays the assessed cost of care. Most families do not start here but reach it after years of self-funding.
4. Self-funding. From pensions, savings, property. The default for most families.
5. Deferred Payment Agreement. Council loans the fees against the property, recovers on sale. See the DPA page.
6. Equity release lifetime mortgage. Useful where a spouse continues to live in the property and a DPA is not available.
7. Immediate-needs annuity. Lump sum buys a guaranteed care fee income for life. Worth comparing where the lump sum is available.

If CHC is refused

Most people with dementia who are referred for full CHC assessment are not found eligible. The reasons given are usually that the needs are predominantly social rather than health, that the behavioural challenge is being safely managed by the existing placement, or that the overall picture does not meet the Nature, Intensity, Complexity and Unpredictability bar.

If you believe the decision is wrong, particularly if the Decision Support Tool was scored low on Behaviour or Cognition despite the family knowing otherwise, the appeal route is worth exploring. Free advice is available from Beacon CHC.

For the broader options after a refusal, see if you have been refused.

The Alzheimer’s Society and Dementia UK

Two national charities are the main starting points for non-financial advice on dementia care: the Alzheimer’s Society and Dementia UK. Both run helplines staffed by people who deal with this every day. Free, independent, and worth calling.