Summary: The Council was at fault for not providing Mrs X with required information about financial arrangements when her relative, Mr Y, moved to a care home in another council area. This caused Mrs X uncertainty and distress as she could not pay the requested top-up, placing Mr Y’s placement at risk. The Council has agreed to reduce the third party top-up to enable Mr Y to remain in the care home. The Council has also agreed to apologise to Mrs X, reimburse her for the top up she initially paid and make service improvements to prevent similar situations in the future.

The complaint

1. Mrs X complained the Council did not properly explain to her the details of the third party top-up when her relative, Mr Y, moved to a new care home. Mrs X says she was unable to afford the contribution, putting Mr Y’s place in the care home at risk and causing her distress.

Back to top

The Ombudsman’s role and powers

2. We may investigate complaints from the person affected by the complaint issues, or from someone else if they have given their consent. If the person affected cannot give their consent, we may investigate a complaint from a person we decide is a suitable representative. (section 26A or 34C, Local Government Act 1974)
3. We investigate complaints about ‘maladministration’ and ‘service failure’. In this statement, I have used the word fault to refer to these. We must also consider whether any fault has had an adverse impact on the person making the complaint. I refer to this as ‘injustice’. If there has been fault which has caused significant injustice, or that could cause injustice to others in the future we may suggest a remedy. (Local Government Act 1974, sections 26(1) and 26A(1), as amended)
4. If we are satisfied with an organisation’s actions or proposed actions, we can complete our investigation and issue a decision statement. (Local Government Act 1974, section 30(1B) and 34H(1), as amended)

Back to top

How I considered this complaint

5. I considered evidence provided by Mrs X and the Council as well as relevant law, policy and guidance.
6. Mrs X and the Council had an opportunity to comment on my draft decision. I considered any comments received before making a final decision.

Back to top

What I found

Relevant law and guidance

Choice of care homes

7. The Care and Support and Aftercare (Choice of Accommodation) Regulations 2014 set out what people should expect from a council when it arranges a care home place for them. Where the care planning process has determined a person’s needs are best met in a care home, the council must provide for the person’s preferred choice of accommodation, subject to certain conditions. This also extends to shared lives, supported living and extra care housing settings.
8. The council must ensure:

• the person has a genuine choice of accommodation;
• at least one accommodation option is available and affordable within the person’s personal budget; and,
• there is more than one of those options.

9. However, a person must also be able to choose alternative options, including a more expensive setting, where a third party or, in certain circumstances, the resident is willing and able to pay the additional cost. This is called a ‘top-up’. But a top-up payment must always be optional and never the result of commissioning failures leading to a lack of choice.

Top-up payment

10. If no suitable accommodation is available at the amount identified in the personal budget, the council must arrange care in a more expensive setting and adjust the budget to ensure it meets the person’s needs. In such circumstances, the council must not ask anyone to pay a ‘top-up’ fee. A top-up fee is the difference between the personal budget and the cost of a home.
11. However, if a person chooses to go into a home that costs more than the personal budget, and the council can show that it can meet the person’s needs in a less expensive home within the personal budget, it can still arrange a place at the home if:

• the person can find someone else (a ‘third party’) to pay the top-up; or
• the resident has entered a deferred payment scheme with the council and is willing to pay the top-up fee themself.

12. In such circumstances, the council needs to ensure the person paying the top-up enters a written agreement with the council and can meet the extra costs for the likely duration of the agreement.

Charging for permanent residential care

13. The Care Act 2014 (section 14 and 17) provides a legal framework for charging for care and support. It enables a council to decide whether to charge a person when it is arranging to meet their care and support needs, or a carer’s support needs. The charging rules for residential care are set out in the Care and Support (Charging and Assessment of Resources) Regulations 2014 and councils should have regard to the Care and Support Statutory Guidance.
14. When the Council arranges a care home placement, it must follow the regulations when undertaking a financial assessment to decide how much a person must pay towards the cost of their residential care.
15. The financial limit, known as the ‘upper capital limit’, exists for the purposes of the financial assessment. This sets out at what point a person can get council support to meet their eligible needs. People who have over the upper capital limit must pay the full cost of their residential care home fees. Once their capital has reduced to less than the upper capital limit, they only have to pay an assessed contribution towards their fees. Where a person’s resources are below the lower capital limit they will not need to contribute to the cost of their care and support from their capital but will still contribute most of their income.

Background

16. Mr Y has a neurological disorder. In May 2025 he was admitted to hospital. In July 2025 Mr Y was ready for discharge. He lacked the mental capacity to make his own decisions about his care and discharge arrangements. His relative, Mrs X, holds lasting power of attorney for health and welfare and finance decisions (which gives her the power to make decisions on his behalf).
17. Mrs X and the Council agreed it was in Mr Y’s best interests to go to a care home and he was discharged to a care home in the Council’s area in August 2025 under discharge to assess arrangements. Once these arrangements ended Mr Y remained in the care home. The care home charged above the Council’s rate and a top up was required at the care home.

What happened

18. The following is a summary of key events relevant to this investigation.
19. When he moved to the care home Mr Y was unsettled and did not leave his room. Mrs X had concerns about his care and support. Within two weeks of him moving there Mrs X also told the Council she was concerned about the top-up as Mr Y was paying a top-up he could not sustain.
20. The Council and Mrs X began to consider alternative care homes for Mr Y’s long-term care. The Council identified possible care homes within its area. Mrs X began to look at care homes closer to where she lived.
21. In August 2025 Mrs X found a suitable care home closer to her. The cost of the care home was above the Council’s local rate. The Council’s case notes record it advised Mrs X it would only pay the agreed local rate for a care home and the difference would require a third party top up. Mrs X found a potential care home and asked the Council about funding. The notes record it said it would ask Mr Y to pay the top up and if he could not pay then family would be asked to pay. Mrs X told the Council Mr Y may be able to pay this from his private pension. It advised Mrs X to speak with the social worker.
22. Later in August 2025 Mr Y’s social worker told Mrs X the top up would need to be paid by a third party. Mrs X said she would pay the top up.
23. At the end of August the Council agreed the new care home placement.
24. Mr Y moved to the new care home in September 2025.
25. A few days after moving Mrs X asked the Council if Mr Y’s care and support could transfer to the new council. The Council said this would not be possible and it also said it would not match the funding rate of the new council.
26. In October 2025 the Council emailed Mrs X documents regarding Mr Y’s move to the new Care Home including a letter, a Care Plan, a financial assessment form and a factsheet about residential and nursing care.
27. The letter was addressed to Mrs X but written to Mr Y. The letter outlined the care charges and said:
• A top up charge must be paid directly to the home.
• The Council will complete a financial assessment.
• Mr Y should pay a provisional weekly contribution.
28. The factsheet explained:
• If someone moves to a care home in another council area it will only pay its local contracted rate.
• The Council will only arrange a care home for people who do not have resources over the capital limit or who lack the mental capacity to make their own arrangements.
• The resident will be responsible for making a weekly contribution from the date of admission. A financial assessment will determine the contribution and the resident will be asked to pay a provisional contribution until the assessment is complete.
• Any amount over the Council’s contracted rate is a ‘top-up’. It said the resident should clarify the top-up with the care home.
• A person can only pay their own top-up in certain circumstances and the person, or the person paying their top-up, will be asked to sign a written agreement.
• If top-up payments are not paid a person may be required to move to an alternative home.
29. On the same day the Council also sent Mrs X a third party top up agreement to sign and return. The agreement was dated from September 2025, the date Mr X moved to the new care home. The agreement said the Care Home fee was £900.93, the personal budget for the placement was £735.93 per week and the top up payment required was £165 per week.
30. Mrs X contacted the Council to advise she could not afford to pay a top up of £165. She said understood her third party top up would be £36. She told the Council she was very stressed about the situation.
31. In October 2025 Mrs X made a complaint to the Council. She said:
• She would like to challenge the third party top-up request for Mr Y’s first care home as the quality of care he received was below expected levels.
• When she looked for a care home close to her there were no places available within the Council’s rate and all required a top-up.
• When Mr Y moved she was unaware the Council would consider the difference in the two Council’s care home rates to be a top-up requirement.
• She was not aware Mr Y’s assessed financial contribution would be deducted from the amount the Council paid for his care.
• She was not aware it was illegal for Mr Y to pay his own top-up.
• She did not know the amount of the third party top-up expected from her when Mr Y moved or that he would be at risk of losing his placement.
• There was no best interests meeting, and communication from the Council was not clear or transparent.
• There was a lack of support and guidance.
• She would like the Council to match the council rate for the new council area, therefore reducing the third party top up.
• The Council should ensure it holds a best interests meeting in similar situations to ensure families fully understood the financial implications of any move.
• If Mr Y had to move away from the new care home it would impact his right to a family life.
32. The Council completed Mr Y’s financial assessment in October 2025.
33. In December 2025 Mr Y’s social worker arranged and carried out a review of his care and support. There were no concerns about his care other than the ongoing concern about funding arrangements.
34. The Council responded to Mrs X’s complaint in December 2025. It said:
• It apologised for the delay in the complaint response and addressed the concerns about the quality of care at the first care home.
• Mrs X was aware of the requirement for a third party top-up at Mr Y’s first care home.
• Mr Y’s social worker had advised her that if Mr Y moved to a new council area it would only pay its own local funding rate.
• Mrs X had agreed to pay the difference between the two funding rates.
• The Council could not find a case note about Mr Y’s personal contribution prior to his move to the new placement.
• It issued a third party top up agreement to Mrs X in September 2025. This included information about who can pay the top up and the consequences for Mr Y if the payment was not made.
• The Council had written to Mrs X in October 2025 to advise her of Mr Y’s client contribution.
• The top up of £165 is the difference between the maximum amount the Council will pay and the cost of the placement.
• Mrs X made the decision to move Mr Y to a new council area and as she has LPA for health and welfare decisions so no best interests meeting was held.
• Mrs X received adequate communication about the financial implications of Mr Y moving to the new care home.
• As a gesture of goodwill the Council said it would waive the third party top up requirement for the duration of Mr Y’s stay at his first care home.
• Mr Y’s social worker would support Mrs X to negotiate with the current care provider or to source an alternative care home.
35. Mrs X made a complaint to us in January 2026.
36. Mrs X paid the third party top-up from September 2025 to January 2026. But in January 2026 she told Mr Y’s social worker she could not pay the required top-up. She said she felt it was in his best interests to remain close to her and did not want to view any other care homes. The social worker asked for the details of any areas Mrs X would be willing to consider for them to do some research.
37. In February 2026 the Council advised Mrs X it would not increase the amount it paid towards the cost of Mr Y’s care home and it would therefore look for a new placement. In March 2026 the social worker began to look for alternative placements.
38. In March 2026 Mrs X contacted the Council to ask for an update and for advice on what the next steps would be.
39. At the beginning of April 2026 Mr Y’s care home gave 4 weeks notice as the full care home fees had not been paid.
40. Mrs X contacted the Council several times during April to ask for a meeting and for advice about how to resolve the situation.
41. Later in April 2026 the Council decided it would increase the amount it paid for Mr Y’s care at his current care home. It said it would pay the outstanding top-up owed for January 2026 to May 2026 and from then Mrs X would pay a lower third party top up and the Council would pay the difference. The care home then removed the notice to end Mr Y’s placement.
42. Mrs X said she would arrange payment of the third party top-up with the care home.

Findings

43. When the Council and Mrs X began to look for new care homes for Mr Y the Council did identify options within its area that did not require a top up. I find no evidence of fault here.
44. The Council said no best interests meeting was required for Mr Y’s move as Mrs X had Lasting Power of Attorney for Health and Welfare decisions and made the decision on his behalf. Although Mrs X was able to make the decision, the Council failed to ensure it gave her sufficient information to make a fully informed choice. The Council should have ensured it carried out the financial assessment or at least given Mrs X all the required information and checked her understanding before Mr Y moved to the new care home. The Council was at fault.
45. Before Mr Y moved to the new care home the Council advised Mrs X it would only pay its agreed local rate and anything more expensive would require a top-up. It said it would ask Mr Y to pay the top up and if he could not pay then family would be asked to pay. There are very limited circumstances in which an individual can pay their own top up. There is no evidence to show the Council explained this to Mrs X or told her the circumstances when Mr Y would be able to pay his own top up before he moved.
46. There is no evidence to show the Council provided Mrs X with information about Mr Y’s possible financial contribution before his move to the care home. This is fault and caused uncertainty to Mrs X acting on Mr Y’s behalf.
47. The Council sent the factsheet giving information about funding for residential and nursing care to Mrs X four weeks after Mr Y moved to the new care home. The factsheet detailed the actions the Council would take when someone was considering a care home. The delay is fault and meant Mrs X was not aware of the financial expectations for her and Mr Y before he moved.
48. In any case, the factsheet and cover letter say a person will be offered a financial assessment to work out how much to contribute towards the cost of their care. It says a provisional charge will be made until the assessment is completed and the person will be asked to pay this to the care home. This is unclear. It does not clearly explain that the individual’s contribution reduces the amount the Council pays towards the cost of care. This is fault and caused uncertainty to Mrs X.
49. The Council sent the third party agreement to Mrs X four weeks after Mr Y had moved. This delay is fault and led to uncertainty and distress for Mrs X as the top-up was higher than Mrs X thought it would be.
50. In its complaint response the Council said Mrs X was aware of the third party requirement as Mr X had paid a top-up in the first care home. But the comment from Mrs X in her contact with the Council suggests Mrs X thought Mr Y paid his own top-up. She signed no third party agreement agreeing to pay a top up for Mr Y’s first care home.
51. In its complaint response in December 2025 the Council said it would work with Mrs X to negotiate with the care home about the top-up requirement or to find an alternative care home. There is evidence to show Mr Y’s social worker continued to work to resolve the issue or to find a new care home placement during the early months of 2026. This did not resolve the problem, but there is evidence to show the social worker did contact other care homes and had some contact with Mrs X. I find no fault here.
52. I have seen no evidence of fault in the Council’s decision about the rate it said it would pay for Mr Y’s care, the top-up requirements or the calculations for the financial assessment. There was fault in the way the Council communicated the information to Mrs X and in the delay in providing with her information she needed. This led to misunderstanding as the Council believed she had agreed to pay a top up she was unable to pay.
53. Mrs X paid the third party top-up to the care home between September 2025 and January 2026. She then told the Council she could no longer afford to pay it.
54. In April 2026 the care home gave notice to Mr Y as his fees were not being paid. There was delay in the Council responding to Mrs X’s contact about the notice. This delay is fault and caused anxiety and uncertainty to Mrs X.
55. Later in April 2026 the Council decided it would pay the outstanding third party top-up amount from January to May 2026. The care home removed the notice.
56. The Council made an arrangement with Mrs X for her to pay a third party top-up she was able to afford from May 2026 onwards. The Council agreed to pay the difference between the two amounts. This is a suitable remedy for part of the injustice caused to Mrs X and Mr Y by the Council’s faults.
57. In its response to our enquiries the Council said it had reflected and will ensure that in future personal budgets for out of area placements are set with explicit reference to host authorities’ costs at the outset. This is an appropriate service improvement so help to prevent similar situations.
58. In June 2026 Mrs X said the care home took payment from her for the third party top-up from January to May 2026, when the Council had said it would pay this. This is fault but I cannot be certain whether this is the fault of the Council or the care home. The Council said this was resolved the same day and the care home arranged to reimburse Mrs X.

Back to top

Agreed Action

59. Within one month of this decision the Council has agreed to:
• Apologise to Mrs X for the uncertainty and stress caused to her by its delay and poor communication about the funding arrangements for Mr Y’s care.
• Reimburse Mrs X the difference between the top-up she paid and the top-up amount she has agreed to pay between September 2025 and January 2026, this is £129 per week.
60. Within five months of this decision the Council has agreed to:
1. Review its factsheet about Residential and Nursing Home care to ensure it includes clear information about the:
1. the personal contribution;
2. the personal budget and that this is the maximum amount the Council will pay, inclusive of the personal contribution; and
3. third party top-ups.
2. Ensure its factsheet is provided at the same time as the Council carries out a needs assessment for residential care so that people are made aware of the potential charges as soon as possible.
3. Review its process for referring people for a financial assessment. It will explain how it will ensure, whenever possible, that people have the necessary information about the contribution they will be expected to pay towards their care before they need to make decisions about the care they want.
61. The Council should provide us with evidence it has complied with the above actions.

Back to top

Decision

62. I find fault causing injustice which the Council has agreed to remedy.

Investigator’s decision on behalf of the Ombudsman

Back to top

Investigator's decision on behalf of the Ombudsman