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Chapter P3: Hospitals, Similar Institutions and Care Homes

Hospitals and Similar Institutions
P3001:Definition of a hospital
P3002:A similar institution
P3005:Definition of a Hospice
Rules on Payability
P3013:Hospitals and similar institutions
P3016:Medical or other treatment
P3021:Similar Institution to a hospital
P3022:Care Homes
P3022:Definition of a care home
P3028:Qualifying Services
P3029:Community Care arrangements
P3032:Group homes - England and Wales only
P3034:Direct payments
P3042:People with homes to sell or who await release of funds
P3044:Background information

Chapter P3: Hospitals, Similar Institutions and Care Homes

Hospitals and Similar Institutions

P3001 Definition of a hospital

An NHS hospital (1) is
1. an institution for the reception and treatment of
persons suffering from illness
persons during convalescence
persons needing medical rehabilitation
2. a maternity home
3. in Scotland, any institution for dental treatment maintained in connection with
a dental school
4. a clinic, dispensary or out-patient department maintained in connection with
any of these homes or institutions.
1 NHS Act 77, s. 128; NHS (Scot) Act 78, s.108

P3002 A similar institution

Similar institution is not defined. If an institution does not satisfy the definition of
hospital, the DM should decide as a question of fact whether it is similar to a hospital
taking into account
1. the purpose of the institution and
2. the type of treatment provided and
3. the level of care offered.

P3003 P3021

To help determine if the establishment is a similar institution to a hospital, DMs must
determine whether the claimant receives on the premises medical or other
1 treatment
1. provided by doctors, qualified nurses or other health care professionals
employed or otherwise engaged at the establishment or
2. under the direct supervision of a qualified doctor, nurse or nurses at the
1 SSWP v Slavin [2011] EWCA Civ 1515; SS (PIP) Regs, reg 29(2)


P3005 Definition of a Hospice

hospice (1) is a hospital or other institution, whose primary function is to provide
palliative care for residents who have a progressive disease in its final stages.

SS (PIP) Regs, reg 30(4)


A hospital or other institution is not a hospice (1) if it is
1. a health service hospital in England (2) or
2. a hospital in Wales (3) vested in
2.1 and NHS trust or
2.2 a local Health Board or
2.3 the Welsh Ministers
3. a health service hospital in Scotland (4) or
4. a hospital maintained or administered by the Defence Council or
5. an institution similar to any of the preceding paragraphs (5).
1 SS (PIP) Regs, reg 30(4); 2 NHS Act 06, s 275(d);3 NHS (Wales) Act 06;
4 NHS (Scot) Act 78, s 108(1); 5 SS(PIP) Regs, reg 30(4)(e)


Rules on Payability

P3013 Hospitals and similar institutions P3014

No amount in respect of the daily living component or mobility component is payable
for any claimant who is an in-patient (1) at a hospital or similar institution, where any of
the costs are paid out of public funds. This is subject to the 28 day rule, see ADM
PIP Chapter 4.

1 WR Act 12, s.86(1); SS (PIP) Regs , reg. 29(1)


For the purposes of P3013 the costs of treatment, accommodation or any related
service are borne out of public funds if the claimant is undergoing the medical or
other treatment as an in-patient in
1. a hospital or similar institution under specified legislation (1) or
2. a hospital or similar institution maintained or administered by the Defence
Council (2)

1 WR Act 12, s 86(2); NHS Act 06; NHS (Wales) Act 06; NHS (Scot) Act 78; 2 SS (PIP) Regs, 29(2)


A claimant is treated as being maintained in a hospital or similar institution, where
costs are borne out of public funds (1) unless
1. accommodation and services are being provided for that person as a private
patient (1) or
2. the person is meeting the full cost of their maintenance as a private patient in
a private hospital.
1 NHS Act 77, s 65; NHS (Scot) Act 78, s 57 & Sch 7A, para 14; NHS & CC Act 90, Sch 2, para 14

P3016 Medical or other treatment

To be treated as a hospital in-patient a person must be receiving
1. medical treatment (for example surgical treatment or administration of drugs
and/or injections) or
2. other treatment which includes nursing services by professionally trained staff
in the form of observation, therapy, support appropriate to the person's needs,
advice and training in domestic and social skills.
It does not include straightforward personal care and attention by medically
unqualified staff.


P3021 Similar Institution to a hospital

When considering whether a claimant is in a care home or in a similar institution to a
hospital it is necessary for the DM to consider whether the claimant's medical and
other treatment (P3002 - P3003), and whether the accommodation is fully funded by
the Health Authority. Prior to the Tribunal of Commissioners decision (1), where
funding was made available to a LA from a Health Authority, the LA would pass on
that funding (2) and the claimant would be treated as being in a care home. The
Tribunal of Commissioners determined, however, that the LA were merely acting as
a go-between for the funds and the Health Authority continued to be responsible for
those claimants. The DM will need to consider all the information on the
arrangements and funding of the claimant's stay, including whether there has been
an assessment of the claimant's care needs. If it was determined that the claimant
was in a similar institution to a hospital then any amount of PIP would not be payable
if the claimant was residing in that accommodation at date of entitlement or following
the first 28 days of their stay.
1 R(DLA) 2/06; 2 NA Act 48, Part III


John is a 35-year-old man with severe learning difficulties, requiring 24-hour support.
He has been in a long stay hospital since 1999 and has been assessed as requiring
NHS continuing health care. Arrangements are being made to move him to a care
home. John requires regular medical or other treatment on the premises of the care
home, and the NHS will continue to be responsible for fully funding his care and
accommodation. The DM obtains all the facts and determines the claimant is in a
similar institution to a hospital. The claimant is entitled to PIP but it remains not
Care Homes

P3022 Definition of a care home P3027

In England and Wales residential and nursing homes are now simply registered as
care homes. A care home is an establishment that provides accommodation
together with nursing or personal care (1), for people who
1. are or have been ill or
2. have or have had a mental disorder or
3. are disabled or infirm or
4. are or have been dependent on alcohol or drugs.
An establishment is not a care home if it is a hospital, an independent clinic or a
children's home (2).

1 WR Act 12, s.85(3); 2 Care Standards Act 2000


In Scotland the term `care home' is not used. However, a person who provides a
care service, which includes home services, must be registered (1). Claimants over
pensionable age are entitled to claim free personal care (2) either in their own homes
or in a `care home'.

1 RC (Scot) Act 01, s.7; 2 CC & H (Scotland) Act 02, s.1


In Scotland a care home is a service (1) which provides accommodation, together with
nursing, personal care or personal support, for persons by reason of their
vulnerability or need; but this does not include
1. a hospital or
2. an independent health care service or
3. a service excepted from this definition by regulations.

1 Regulation of Care (Scotland) Act 2001, s.2(1)(b) & 2(3)


The nursing or personal care (1) may be provided or subsidised in whole or in part from
public or local funds under specified enactments (2) for qualifying services, such
legislation is used by
1. LAs
2. LEAs and
3. the Education Funding Agency. Note: Please refer to P3026.

1 WR Act 12, s. 85(3); 2 The Apprenticeships, Skills, Children and Learning Act 2009, parts 2 & 3.

P3026 P3025 P3034 P3038

The daily living component is not payable where the claimant is resident in a care
home and any of the costs of qualifying services (see P3028) provided for the
claimant are met out of public or local funds (1) by virtue of specified enactments (2).
1 WR Act 12, s 85(2); 2 NA Act 48, Part III; SW (Scot) Act 68; MH (C&T)(Scot) Act 02;

CC&H (Scot) Act 02; MH Act 83; SS (PIP) Regs, reg 28(2)


Where a claimant is in accommodation funded from public or local funds, the DM
needs to establish if there is any LA involvement and how the claimant's stay in the
home is funded. If it is determined that a claimant is in a care home in accordance
with P3022, then any PIP daily living component will not be payable if the claimant
was residing in that accommodation at the date of claim or following the first 28 days
of their stay (1) (see P4016).
1 SS (PIP) Regs, reg 30 (1)

P3028 Qualifying Services P3026 P3038

services (1) for the purposes of P3033 are
1. accommodation and
2. board and
3. personal care and
4. such other services as may be prescribed.
Note: There are no other services prescribed at present.
1 WR Act 12, s.85(4)

P3029 Community Care arrangements P3044

Under the community care arrangements the social services or social work
department of the LA is responsible for
1. assessing the care needs of people who approach them and
2. making arrangements to meet care needs where appropriate.

1 NHS & CC, Act 90, s 47 & 55


The LA can provide or make arrangements for services to enable people to continue
to live in their own homes where practicable. Such services may be respite care and
day and home care. The LA can also provide or make arrangements for care

P3031 P3034

If the LA decides that a person needs care in a care home, the LA will
1. make a placement under relevant legislation (1) in
a care home they own or
a privately owned care home and
2. calculate the costs of any qualifying services (2) and
3. assess, by a means test the person's ability to pay those costs (3).
Note: Care homes or care services in Scotland must be registered (4).
1 NA Act 48, Part III, s 21 & 26; SW (Scot) Act 68, Parts II & IV; MH (Scot) Act 84, s 7;
2 SW (Scot) Act 68, s 87; 3 NA (AR) Regs;4 Care Standards Act 2000;
Public Services Reform (Scotland) Act 2010, s.47(1)(2) & Sch 12

P3032 Group homes - England and Wales only

As part of community care arrangements, the LA may provide accommodation in
group homes rather than registered care homes. These are usually houses where
residents learn the necessary skills for independent living. They may have been paid
HB in the past but now may qualify for the Housing Costs Element in an award of

P3033 P3028

If the resident is paying all the costs of all the qualifying services provided in the
home from their income (including benefits) PIP will be payable.

P3034 Direct payments

The LA may make payments for care needs, including residential care, directly to the
disabled person (1). The person uses the payments to make their own arrangements
for care services. Direct payment may not be made
1. to people aged 65 or over (unless a payment was made in the twelve months
before reaching age 652)
2. where care services are provided by any of the person's family living in the
same household (3)
3. for periods in residential care exceeding four weeks in twelve months (4).
Where a person has made their own arrangements for entering a care home using a
direct payment, then this is treated as being borne out of public or local funds.
1 Community Care (Direct Payments) Act 96, s 1; SW (Scot) Act 68, s 12B;
2 Community Care (Direct Payments) Regs & Community Care
(Direct Payments) (Scotland) Regs, reg 2(2)(a);3 reg 3; 4 reg 4


Sophia is a 45 year old blind woman who, despite Social Services help, is unable to
manage alone at home. She is in receipt of PIP at the enhanced rate of mobility
component and standard rate daily living component. She is to move into a care
home for the blind. She is in receipt of UC and the LA has arranged the placement
and will be funding her stay under Part III accommodation. PIP daily living
component will not be payable after the first 28 days but the mobility component will
continue to be paid.
P3035 P3026
does not apply in circumstances where any of the costs of the qualifying
services are borne wholly or partly out of public or local funds by virtue of specified
legislation (1).
1 SS(PIP)Regs, reg 28(3); Ed Act 96, s.485; Ed Act 02, s.14; Ed (Scot) Act 80, s49 or 73;
F&HE Act 92, s.65; F&HE (Scot) Act 05, s.4 & 11; T&HE Act 08, s.22
P3037 P3031
1. does not apply during any period which the local authority looking after the
person 1 places that person
1. in a private dwelling with a family or
2. a relative of the person or
3. with some other suitable person.

1 SS (PIP) Regs, reg 28(4)


The PIP daily living component is payable if
1. a disabled student
1.1 receives a student grant or loan and
1.2 lives in halls of residence and
2. the cost of any qualifying services is met wholly or partly out of public or local
funds for (1)
2.1 grants in aid of educational services (2) or
2.2 awards by LEAs for degree courses and further education and awards
by the Secretary of State for Education for teacher training or
postgraduate courses (3) or
2.3 grants to institutions by the University Funding Council and the
Polytechnics and Colleges Funding Council (4) or
2.4 student loan (5) or
3. the accommodation is not provided under the powers in P3026.
See P3028 for the meaning of qualifying services.
1 SS (PIP) Regs, reg 28(3); 2 Education Act 44, s 100; Education (Scotland) Act 80, s 75;
3 Education Act 62, s 1, 2 & 3; Education (Scotland) Act, s 49 & 78;
4 Education Reform Act 88, s 131(6) & 132(7); Further & Higher Education (Scotland) Act 92,
s 4 & 40; 5 Education (Student Loans) Act 90, s 1




P3041 Self-funders

PIP daily living component and the mobility component will be payable for any period
during which the whole costs of all the qualifying services are met
1. out of the resources of the person for whom the qualifying services are
provided or
2. partly out of that person's own resources and partly with the assistance from
another person or charity or
3. on that behalf by another person or a charity (1).
1 SS (PIP) Regs, reg 30(5)

P3042 People with homes to sell or who await other release of funds

People who enter a care home for the first time may have a home to sell, or other
capital assets. The available assets or value of a property are taken into account by
the LA when assessing payment of care home fees.

P3043 P3048

When a person first enters a care home the DM is required to establish who is
funding their stay and will this change. This information should be obtained from the
Payment should be suspended until all reasonable enquiries are made. Every
effort should be made to resolve the issue as soon as possible and the benefit put
into payment or a payability decision made.

Example 1

Jim was receiving the enhanced rates of both the daily living and mobility
components. His representative informed the DM that he had entered a care home
and would not be coming home. The DM ascertained that the LA were at present
funding Jim, and there was no indication that there would be any change to this
arrangement. Jim's PIP was paid for the first 28 days in the care home, and then
suspended until these reasonable enquiries had been made. The suspension was
then lifted and a payability decision was given ceasing payment of the daily living
component, but payment of the mobility component continued.

Example 2

Hannah was in a care home but her daughter still lived in the family home. When the
DM made enquiries to the LA, although there was a property involved, there was
some dispute over ownership. As such the LA had not yet decided if Hannah had
any assets to fund her own stay and they continued to fund in the meantime. The
DM decided that as the LA were funding, Hannah was entitled to the enhanced rate
of the daily living component and standard rate of the mobility component. The daily
living component was not payable however, whilst she is in the care home. At the
same time they put a 12 month case control in place to assess the situation at a later
stage. On activation of the case control the DM made enquires to the LA who
informed him that it had been decided that Hannah did have property and that they
had placed a charge on it from the date of her arrival at the home. The DM decided
that as Hannah has been self-funding the original decision should be revised, as it
had been made with incomplete evidence, and made payment of arrears of the daily
living component from the date she had been charged for. As the DM is aware that
Hannah's funding is not indefinite a further case control is set for 24 months to check
on the funding status at that time.

Example 3

Damien was placed in a care home and the DM made enquiries as to the nature of
the funding of his care home fees. Whilst these enquiries were being made the
payment of his enhanced rates of daily living and mobility components of PIP were
paid for the first 28 days, and then his daily living component of PIP was suspended.
On enquiries being made it was established that the LA were paying for Damien's
stay and were not considering self-funding. On these findings the DM decided that
the claimant could not be a self-funder and therefore the payment of his enhanced
rate of daily living component was ceased from the date of the suspension, but his
mobility component continued to be paid. Two years later Damien received an
inheritance of a property from his great aunt. The DM was not informed immediately
and it was only on a review of the benefit that it was established that Damien was
now paying his own care home fees, as the property had been sold and the LA had
entered into an agreement with Damien's representative. On this information the
date the care home fees were being paid to the LA from was established and
regulation provisions were used to supersede. As there had been a change of
circumstances with the inheritance it could not be said that the original decision was
made with incomplete evidence.

P3044 Background information

If there is a property involved the full market value of the property is taken into
account in the assessment, less 10% for selling costs and any mortgage or loan
secured on it (1) where
1. a person is the sole owner of a property and
2. the LA carry out the assessment in P3029.
Note: The LA will make this calculation and advise of the amount of repayment

1 NA (AR) Regs, reg 23(1)

P3045 P3047 P3047 P3049

Until the property is sold the person will probably not be able to meet all the
assessed liability to pay for the accommodation. The LA may put a charge on the
property (1). Once it is sold, the debt owing to the LA is repaid. Where
1. a claimant is in a care home being funded by the LA pending the sale of a
property or other release of funds and
2. the fees will be repaid to the LA out of the proceeds of the sale of the property
or release of funds
benefits should be paid unless and until the point is reached where there is a real
risk that the proceeds are inadequate to make full repayment. For periods before
6.10.03 the person should not be entitled to IS, HB or JSA(IB) for the period which
they eventually repay the LA funding.

1 HASSASSA Act 83, s 22(1)

P3046 P3050

From 9.4.01 the value of the property is disregarded by the LA for the first twelve
weeks from when permanent admission commences.


For the first twelve weeks of any such arrangement the condition in P3045 2. will not
be satisfied as the LA will disregard the value of the property as in P3045 and the
person will not have to repay the LA. If the LA is funding during this period payment
of PIP daily living component should be removed from the appropriate date.


For the purposes of P3043, conditions for payment of benefit will be satisfied if any
evidence exists of an agreement to repay the LA from the sale proceeds or release
of funds. However, for the purposes of community care law there is no need for a
prior agreement to repay fees to the LA.
In cases of uncertainty as to the entitlement to benefit, the benefit should be


In cases where sales arrangements become prolonged a risk may arise that the sale
proceeds will not cover the accrued debt to LA. Once such a point is reached P3045
2. is no longer satisfied. In such circumstances the benefit award must be
superseded to remove payability.


The effective date of the decision to remove payment of benefit is the date of
change (1). That date will be the point at which the accrued debt to the LA becomes
greater than the value of the property as calculated in P3046. PIP daily living
component may however remain payable for the first 28 days of LA funding in
accordance with P4016, ADM chapter 4.
1 UC, PIP, JSA & ESA (D&A) Regs, Sch 12, part 2, para 12.