4.1.2 Personal Budgets

1. Introduction

This policy sets out how Lancashire County Council will meet its duties under the Care Act 2014, Section 26, in relation to personal budgets making them the norm for adults with care and support needs.

Personal budgets are a key part of a person-centred care and support system. Independent research shows that where implemented well personal budgets can improve outcomes and deliver better value for money.

2. Policy Aim

The policy aims to ensure that the process used to establish the personal budget is transparent so that people are clear how their budget was calculated. It is also essential that the method used is robust so that people have confidence that the personal budget allocation is correct and therefore is adequate to meet their care and support needs.

3. Principles

The following principles apply to both the indicative / upfront budget and the final signed off personal budget that forms part of the care and support plan.

3.1 Transparency

Lancashire County Council will make its allocation processes publicly available as part of its general information offer, or ideally provide this on a bespoke basis (in a format which is accessible to them) for each person they are supporting. This will ensure that people fully understand how the personal budget has been calculated, both in the indicative amount and the final personal budget allocation. Where a complex Resource Allocation System (RAS) process is used, Lancashire County Council will pay particular consideration to how it will meet this transparency principle, to ensure people are clear how the personal budget was calculated.

3.2 Timeliness

It is crucial when calculating the personal budget to arrive at an upfront allocation which can be used to inform the start of the care and support planning process. This is called an indicative budget and will enable the person to plan how their needs are met. After refinement during the planning process, this indicative amount is then adjusted to be the amount that is sufficient to meet the needs which Lancashire County Council is required to meet or decides to meet. This adjusted amount then forms the personal budget recorded in the care plan.

3.3 Sufficiency

The amount that Lancashire County Council calculates as the personal budget must be sufficient to meet the needs which it is required to meet or decides to meet, and must also take into account the person’s reasonable preferences for meeting these needs as detailed in the care and support plan, or support plan.

3.4 Costs

The personal budget must be an amount that is the cost to Lancashire County Council of meeting the person’s needs. In establishing the ‘cost to Lancashire County Council’, consideration should be given to local market intelligence and costs of local quality provision to ensure that the personal budget reflects local market conditions and that appropriate care that meets needs can be obtained for the amount specified in the budget.

To further aid the transparency principle, these cost assumptions should be shared with the person, so they are aware of how their personal budget was calculated. Consideration should also be given as to whether the personal budget is sufficient where needs will be met through the use of direct payments, especially around any other costs that may be required to meet needs or ensure people are complying with legal requirements associated with becoming an employer (see Direct Payments).

There may be concern that the ‘cost to Lancashire County Council’ results in the direct payment being a lesser amount than is required to purchase care and support from the local market due to Lancashire County Council bulk purchasing and block contract arrangements. However, by basing the personal budget on the cost of quality local provision, this concern should be allayed.

However, a request for needs to be met via a direct payment does not mean that there is no limit on the amount attributed to the personal budget. There may be cases where it is more appropriate to meet needs via directly provided care and support, rather than by making a direct payment. For example, where there is no local market for a particular kind of care and support that the person wishes to use the direct payment for, except for services provided by Lancashire County Council. It may also be the case where the costs of an alternate provider arranged through a direct payment would cost more than the same support arranged by Lancashire County Council whilst achieving the same outcomes for the individual.

In all circumstances, consideration will be given to the expected outcomes of each potential delivery route. It may be that by raising the personal budget to allow a direct payment from a particular provider, it is expected to deliver much better outcomes than Lancashire County Council delivered care and support, or there may be other dynamics such as the preferred option reducing the need for travel costs, or out of hours care. In addition, efficiencies to Lancashire County Council (for example through an individual making their own arrangements) will also be considered. Decisions should therefore be based on outcomes and value for money, rather than purely financially motivated.

In cases where making a direct payment is a more expensive option to meet needs, the care and support plan will be reviewed to ensure that it is accurate and that the personal budget allocation is correct.

Lancashire County Council will work with the person, their carer and independent advocate (if there is one) to agree on how best to meet their care and support needs. It may be that the person can take a mixture of direct payment and Lancashire County Council arranged care and support, or Lancashire County Council can work with the person to discuss alternate uses for the personal budget.

4. The Legal Framework

A personal budget, in conjunction with the care and support plan, or support plan (see Care and Support Planning policy), enables the adult, and their advocate if they have one, to exercise more choice and control over how their care and support needs are met. It means:

• before care and support planning begins, having an estimate of how much money will be available to meet the adult’s assessed needs and, in the final personal budget, having clear information about the total amount of the budget, including the amount Lancashire County Council will pay, and what amount (if any) the person will pay.
• being able to choose how the money is managed from a range of options, including direct payments, Lancashire County Council managing the budget and a provider or third party managing the budget on the adult’s behalf) or a combination of these approaches.
• having a choice over who is involved in developing the care and support plan for how the personal budget will be spent, including family or friends.
• having greater choice and control over the way the personal budget is used to purchase care and support and from whom it is purchased.

It is vital that the process used to establish the personal budget is transparent so that people are clear how their budget was calculated. It is also essential that the method used is robust so that people have confidence that the personal budget allocation is correct and therefore is adequate to meet their care and support needs. The allocation of a clear upfront indicative allocation at the start of the planning process will help people to develop the plan and make appropriate choices over how their needs are met.

The process of allocating the personal budget should be completed in a timely manner, proportionate to the needs of the adult to be met. At all times the person should be informed where they are in the care planning process, what will happen next and the likely timeframes.

4.1 What services must be excluded from a personal budget?

Intermediate care and reablement services, for which Lancashire County Council cannot or chooses not to make a charge, must be excluded from the personal budget. This will mean that where either intermediate care or reablement is being provided to meet needs (for example, under section 18, 19 or 20 of the Care Act) the cost of this must not be included in the personal budget.

Lancashire County Council will not include additional elements that would not normally be classified as intermediate care or reablement into this exclusion. Indeed, the Act restricts the regulations into specifying only care and support which Lancashire County Council cannot charge for or chooses not to charge for. This ensures that long-term care and support will always be part of the personal budget, and in future, count towards the cap on care costs. Also, broader rehabilitation services could be included to meet identified health needs as part of a joint personal budget across health and social care.

In some circumstances, Lancashire County Council may choose to combine either service with aspects of care and support to meet eligible or ongoing needs, which would require a personal budget to be developed. Removing the cost of provision of intermediate care/reablement from the personal budget in these scenarios ensures that the allocation of both services is applied uniformly across all local authorities, and in future people progress towards the cap on care costs in a fair and consistent way.

In cases where intermediate care/ reablement is provided to meet needs under section 18 or 20(1) or under section 19(1) or 20(6), either in isolation or combined with longer-term care and support, the plan should describe what the package consists of and how long it will last. This will help you understand what is being provided to meet your needs. However, you will not receive a personal budget, unless there are other forms of care and support being provided under these sections. In these cases, the personal budget amount must not include the cost of intermediate care/reablement which are provided free of charge.

5. The Personal Budget

Everyone whose needs are met by Lancashire County Council, whether those needs are eligible (see Eligibility chapter) or where Lancashire County Council chosen to meet other needs, will be allocated a personal budget as part of the care and support plan, or support plan.

The personal budget should you clear information regarding the money that has been allocated to meet your needs identified in their assessment and recorded in your plan.

An indicative amount will be shared with you, and anybody else involved, at the start of the planning process, with the final amount being confirmed through this process. The detail of how the personal budget will be used will be set out in the finished plan. The detail of how the personal budget will be used is set out in the care and support plan, or support plan.

At all times, your wishes will be considered and respected. For example, you should not be forced to accept specific options, such as moving into a care home against your will because it is the cheapest.

6. Personal Budget Options

There are 3 main ways in which a personal budget can be provided. You, and anybody else that you want to assist you, can make informed decisions about how your personal budget operates, including:

• you can choose for the personal budget allocation to remain with Lancashire County Council to spend on their behalf, in line with your wishes.
• or be taken as a direct payment (see Direct Payments).
• you may prefer a combination of approaches. For example, some of your needs may be met by a direct payment, with the remainder of the personal budget used to meet needs through Lancashire County Council.

There may also be cases where mixed package of care and support is preferred. For example, this may be a direct payment to the you for some of your needs, with the remainder of the personal budget used to meet needs through Lancashire County Council or third-party provision, or any combination of the above. The method of allocating the personal budget will be decided and agreed during the care and support planning process (see Care and Support Planning). It is important that these arrangements can be subsequently adjusted if you wish, with the minimum of procedure. The process for allocating and agreeing the personal budget through the planning process will be as straightforward and as timely as possible so that you can access the budget without significant delay.

7. Elements of the Personal Budget

The personal budget must always be sufficient to meet your care and support needs and must include the cost to Lancashire County Council of meeting your needs which it is under a duty to meet or has exercised its power to do so. This overall cost must then be broken down into the amount you must pay, following the financial assessment, and the remainder of the budget that Lancashire County Council will pay.

The personal budget may also set out other amounts of public money that you are receiving, such as money provided through a personal health budget. Lancashire County Council will consider requests from you to present your personal budget in this way.

Where Lancashire County Council is meeting your eligible needs and your financial resources are above the financial limit, but you have requested that Lancashire County Council meet your needs, Lancashire County Council may make a charge for putting in place the necessary arrangements to meet your needs. Where this occurs, Lancashire County Council will consider how best to set this information out to you in an accessible format. This fee is not part of the personal budget, since it does not relate directly to meeting needs, but it may be presented alongside the budget to help you understand the total charges to be paid. For example, Lancashire County Council may wish to specify this in both the plan and the personal budget, so all parties are clear on how costs are allocated.

Similarly, there will be cases where you or a third party is making an additional payment (or a top up) on your behalf so you can secure the care and support of your choice, where this costs more than Lancashire County Council would pay for such a type of care. In these cases, the additional payment does not form part of the personal budget, since the budget must reflect the costs to Lancashire County Council of meeting identified needs. However, Lancashire County Council will consider how best to present this information, so that the total amount of charges paid is clear, and the link to the personal budget amount is understood.

8. Self-funders and Personal Budgets

See also Self-Funders chapter

Where Lancashire County Council is meeting your eligible needs (see Eligibility policy) and your financial resources are above the limit, but you have requested that Lancashire County Council meets your needs, a charge may be made for putting in place the arrangements to meet needs. When this occurs, the information will be set out in an accessible format. This fee is not part of the personal budget, because it does not relate directly to meeting needs, but it will be presented alongside the budget to help you understand the total charges to be paid. To ensure everyone is clear about how costs are allocated, this fee will be included in both the plan and the personal budget.

9. Independent Personal Budgets

Following assessment, if you have eligible needs that Lancashire County Council is not under a duty to meet (either because you do not qualify for financial assistance or do not want it to meet your needs) you can request an independent personal budget, setting out what Lancashire County Council would spend on meeting your eligible needs. This would enable you to qualify for state funding when your accrued costs reach the cap.

As with actual personal budgets, Lancashire County Council must keep independent personal budgets under review. It must also reassess you on independent personal budgets if they feel your circumstances have changed and revise the budget accordingly.

10. Top Up Payments

Where the you or a third party, such as a relative, is making an additional payment (or a ‘top up’) on your behalf so you can secure the care and support of your choice when this costs more than Lancashire County Council would pay, the additional payment should not form part of the personal budget because the budget indicates the costs to Lancashire County Council of meeting the needs. However, the information about the additional payment will be presented so that the total amount of charges being paid is clear and the link to the personal budget amount is understood.

11. Exclusions from the Personal Budget: Intermediate Care and Reablement

Regulations set out the cases or circumstances where the costs of meeting the needs of care and support do not have to be incorporated into the personal budget.

The Care and Support (Personal Budget Exclusion of Costs) Regulations 2014 set out that the provision of intermediate care and reablement services, for which Lancashire County Council cannot or chooses not to make a charge must be excluded from the personal budget. This will mean that where either intermediate care or reablement is being provided to meet needs, the cost of this must not be included in the personal budget.

Intermediate care services are usually provided to patients, often older people, after leaving hospital or when they are at risk of being admitted to hospital. The services are a link between places such as hospitals and people’s homes and between different areas of the health and social care system – community services, hospitals, GPs and social care.

Lancashire County Council will not include additional elements that would not normally be classified as intermediate care or reablement into this exclusion. In fact, the Care Act restricts the regulations into specifying only care and support which Lancashire County Council cannot charge for, or chooses not to charge for. This ensures that long term care and support will always be part of the personal budget. Also, broader rehabilitation services could be included to you to meet identified health needs as part of a joint personal budget across health and social care.

Intermediate care / reablement is usually provided as a free, universal service under the Act, and therefore would not contribute to the personal budget amount. However, in some circumstances, Lancashire County Council may choose to combine either service with aspects of care and support to meet eligible or ongoing needs, which would require a personal budget to be developed. Removing the cost of provision of intermediate care / reablement from the personal budget in these scenarios ensures that the allocation of both services is applied uniformly across all local authorities.

In cases where intermediate care / reablement is provided to meet needs, either in isolation or combined with longer term care and support, the plan will describe what the package consists of and how long it will last. This will help you understand what is being provided to meet your needs. However, you will not have a personal budget, unless there are other forms of care and support being provided. In these cases, the personal budget amount does not include the cost of intermediate care / reablement, which should be provided free of charge.

12. Calculating the Personal Budget

It is important to have a consistent method for calculating personal budgets that provides an early indication of the appropriate amount to meet the identified needs to be used at the beginning of the planning process. The method used for calculating the personal budget should produce impartial outcomes to ensure fairness in care and support packages regardless of the environment in which care and support takes place, for example, in a care home or someone’s own home. Lancashire County Council will not apply arbitrary ceilings to personal budgets, as that could result in you being forced to accept to move into care homes against your will.

There are many variations of systems used to arrive at personal budget amounts, ranging from complex resource allocation systems (RAS), to more ‘ready-reckoner’ approaches. Complex RAS models of allocation may not work for all people, especially where people have multiple complex needs, or where needs are comparatively costly to meet, such as in the case of deafblind people. It is important that these factors are taken into account, and that a ‘one size fits all’ approach to resource allocation is not taken. If a RAS model is being used, Lancashire County Council will consider alternative approaches where the process may be more suitable to particular people to ensure that the personal budget is an appropriate amount to meet needs.

Regardless of the process used, the most important principles in setting the personal budget are transparency, timeliness and sufficiency. This will ensure that you, your carer, and your independent advocate (if you have one) are  fully aware of how the budget was calculated, that you know the amount at a stage which enables you to effectively engage in care and support planning, and that you can be confident that the amount includes all relevant costs that will be sufficient to meet your identified needs in the way set out in the plan. Lancashire County Council will also explain that the initial indicative allowance can be increased or decreased depending on the decisions made during the development of the plan. This should prevent disputes from arising, but it must also be possible for you, your carer or independent advocate to challenge Lancashire County Council on the sufficiency of the final amount. These principles apply to both the indicative upfront budget and the final signed off personal budget that forms part of the care and support plan.

13. Use of the Personal Budget

See also Lancashire County Council’s Policy on Brokerage (to follow).

You will have the maximum possible range of options for managing the personal budget, including how it is spent and how it is utilised. There are two main ways in which a personal budget can be deployed:

1. a managed account held by Lancashire County Council with support provided in line with your wishes.
2. a direct payment (see also Direct Payments).

In addition, you may choose a ‘mixed package’ that includes elements of some or all three of the approaches above. Lancashire County Council must ensure that whatever way the personal budget is used, the decision is recorded in the plan, and you are given as much flexibility and choice as is reasonably practicable in how your needs are met. The mixed package approach can be a useful option for people who are moving to direct payments for the first time. This allows a phased introduction of the direct payment, giving you time to adapt to the direct payment arrangements.

14. Pooling Personal Budgets

Lancashire County Council will also give consideration to how choice could be increased by you pooling your budgets together. For example, this may include pooling budgets of people living in the same household such as an adult and carer, or pooling budgets of people within a community with similar care and support needs, or aspirations. Pooling budgets in circumstances such as this may deliver increased choice, especially where managed budgets are concerned. Developing networks of ‘budget poolers’ could help create dynamic groups of people working together to meet needs.

Evidence suggests that in most cases people need to know the amount of their budget, be able to choose how it is managed, and have maximum flexibility in how it is used to achieve the best outcomes. Lancashire County Council will aim to develop a range of means to enable you to make good use of direct payments and where you choose other options, will ensure local practice that maximises choice and control. Lancashire County Council will also take care not to inadvertently limit options and choices. For example, ‘pre-paid cards’ can be a good option for some people using direct payment, but must not be used to constrain choice or be only available for use with a restricted list of providers.

15. Use of a Carer’s Personal Budget: Where the Person being Cared for has Eligible Needs

15.1 Charges

A carer’s need for support can be met by providing care to you. However, decisions on whom a particular service is to be provided to affect whether the service is chargeable and who is liable to pay any charges.  It is important that it is clear to all individuals involved:

• whose needs are intended to be met by a particular type of support.
• to whom the support will be provided directly and therefore who pays any charges due.

Where a service is provided directly to you, even if it is provided to meet a carer’s needs, you are liable to pay any charge and have to agree to do so. Where the needs are met by providing care and support direct to you, the charge cannot be imposed on the carer.

Decisions about which services are provided to meet carers’ needs, and which are provided to meet your needs, will therefore impact on which individual’s personal budget includes the costs of meeting those needs. These decisions should be made as part of the care planning process (see Care and Support Planning policy), in discussion with the individuals concerned, and this includes consideration of whether joint plans (and therefore joint personal budgets) for the two individuals may be of benefit.

Lancashire County Council will consider how to align personal budgets where they are meeting the needs of both you and your carer concurrently. Where you have eligible needs for care and support and have a personal budget and a care and support plan in your own right, and your carer’s needs can be met, in part or in full, by the provision of care and support to you, then this kind of provision is incorporated into your plan and personal budget, as well as being detailed in the support plan for your carer.

16. Short Breaks

Short breaks may be needed to enable your carer to look after their own health and wellbeing alongside caring responsibilities and to take a break from caring. For example, this may enable them to attend their own health appointments or go shopping or pursue other recreational activities. It might be that regular replacement care overnight is needed so that your carer can catch up on their own sleep. In other circumstances, longer periods of replacement care may be needed, for example, to enable your carer to have a longer break from caring responsibilities or to balance caring with education or paid employment. In these circumstances, where the form of the replacement care is essentially a homecare service provided you that enables your carer to take a break, it should be considered a service provided to you, and must be charged to you, not your carer.

Your carer’s personal budget should be an amount that enables your carer to meet their needs to continue to fulfil their caring role and takes into account the outcomes that your carer wishes to achieve in their day to day life. This includes their wishes and / or aspirations concerning paid employment, education, training or recreation if the provision of support can contribute to the achievement of those outcomes. The manner in which the personal budget is used to meet your carer’s needs should be agreed as part of the planning process.

Lancashire County Council must have regard to the wellbeing principle, as it may be the case that your carer needs a break from caring responsibilities to look after their own physical / mental health and emotional wellbeing, social and economic wellbeing and to spend time with other members of the family and personal relationships (see Wellbeing Principle and Preventing, Reducing or Delaying Needs chapters). Whether or not there is a need for replacement care, your carer may need support to help them to look after their own wellbeing. This may be a course of relaxation classes, training on stress management, gym or leisure centre membership, adult learning, development of new work skills or refreshing existing skills (so that they might be able to stay in paid employment alongside caring or return to paid work) or pursuit of hobbies such as the purchase of a garden shed, or purchase of a laptop so they can stay in touch with family and friends.

17. Use of a Carer’s Personal Budgets: Where the Adult Being Cared for Does Not Have Eligible Needs

Lancashire County Council is able to meet your carer’s needs by providing a service directly to you.  However, there may be instances where you do not have eligible needs and so do not have your own personal budget or care and support plan. In these cases, your carer must still receive a support plan that covers their needs and how they will be met. This would specify how your carer’s needs are going to be met (for example, through the provision of replacement care) and the personal budget should be for the cost of meeting the carer’s needs.

Where you need care but you do not receive a personal budget or care plan because no matter what the service is in practice, it is designed to meet your carer’s needs, it is still essential that you are involved in the decision making process and agree with the intended course of action.

In situations such as these, your carer could request a direct payment and use that to purchase replacement care from an agency, rather than using an arranged service from Lancashire County Council or a third party. Lancashire County Council will take steps to ensure that your wishes are taken into account during these decisions. For example, you may not want to receive replacement care in this manner.

If this type of replacement care is charged for (and it may not be), then it would be you that would pay, not your carer, because they are the direct recipient of the service. This is, in part, why it is important that you agree to receiving that type of care.

The decisions taken by you and your carer and the charging implications should be agreed and recorded in the support plan.

If a dispute arises and you refuse to pay the charge, Lancashire County Council must, as far as it is feasible, identify some other way of supporting your carer.

For the purposes of charging, the personal budget that your carer receives specifies the costs to Lancashire County Council and the costs to you based on the charging guidance (see Charging and Financial Assessment: Principles). In this case, ‘the adult’ refers to your carer, because they are the adult whose needs are being met. However, in instances where replacement care is being provided, your carer should not be charged; if charges are due to be paid then these have to be met by you. Any such charges should not be recorded in your personal budget but set out clearly and agreed by those concerned.

18. Limiting Disputes

Lancashire County Council will take all reasonable steps to limit disputes regarding the personal budget allocation. This will include through effective care and support planning, and transparency in the personal budget allocation process. Additionally, many disputes may be avoided by informing people of the timescales that are likely to be involved in different stages of the process. Keeping people informed how their case is progressing may help limit the number of disputes.

19. Further Reading

19.1 Relevant chapters

Personalisation

Residential Care Charging Policy

Non-Residential Care Charging Policy

Direct Payments

19.2 Relevant information

Chapter 11, Personal Budgets, Care and Support Statutory Guidance (Department of Health and Social Care)

Quality Statement 2: Empowering People to Manage their Personal Budget (NICE)

See also Personal Budgets, in Case Studies, Resources