Going into hospital - money matters

Going into hospital can be very upsetting and money may be the last thing on your mind. But if you don’t have a plan to deal with your money when you are in hospital, you could have debts to deal with when you leave.

Overview

  • Disability Living Allowance, Personal Independence Allowance and Attendance Allowance stop if you are in hospital for 28 days.
  • You can continue to get Housing Benefit for up to 52 weeks.
  • Universal Credit will not usually be affected for 6 months.
  • If you get benefits, tell the Department of Work and Pensions (DWP) and your local authority if you go into hospital.
  • If you don’t tell the DWP that you are in hospital, they will continue to pay you the same amount. This means you may not be getting the right amount and you may have to pay some money back.
  • You could make a plan with a relative or friend so they know what to do if you have to go into hospital.
  • They could help with your finances while you are in hospital.
  • You should continue to pay your essential bills (such as rent, council tax, fuel and insurance). You could do this by direct debit.
  • If you cannot make financial decisions for yourself, someone may need to manage your finances for you.

Going into hospital

What happens to my money when I go into hospital?

Going into hospital can affect your money in a number of ways. You may find that:

  • your income will drop,
  • you can’t afford all of your bills and you fall into debt,
  • your benefit entitlement changes, or
  • your doctor thinks that you cannot make money decisions for yourself. This is called not having ‘mental capacity’. If you can’t make decisions, someone else might have to do this for you.

Should I tell anyone that I have gone into hospital?

Department for Work and Pensions (DWP)

It is important to tell the Department for Work and Pensions (DWP) if you go into hospital. If you are too unwell to tell them, ask your carer or a relative to do it for you.

You could also ask a health care professional, like a nurse, doctor or social worker to do it for you. Some hospitals wards have regular visits from benefits advisers who can give you advice and ensure the DWP knows you have gone into hospital.

You can tell the DWP by telephone, but it is better to write to them. Keep a copy of the letter and get a certificate of postage from the post office. These are usually free of charge. This way you can prove that you have told the DWP of your change in circumstances.

If you don’t, the DWP will continue to pay your benefits in the normal way. This might mean that you get money you aren’t entitled to. If this happens, it is called being ‘overpaid’.

If you are overpaid, the DWP are likely to ask you for the money back. If you can’t pay it back in one lump sum, they will usually deduct money from your benefits. This means you will get a smaller amount of benefit each week; but you will still have to pay for all your usual living expenses like your food, gas, electricity and travel costs.

Local authority

If you are claiming Housing Benefit, you need to tell your local authority that you have gone into hospital. Your Housing Benefit can be paid for 52 weeks while you are in hospital. But the local authority needs to know when you went there to avoid an overpayment.

You should also tell the local council so your property can be exempt from council tax,1 or so you can get extra help to pay your council tax. You can read more about this below. 

Your landlord

If you rent from a private landlord or housing association you should normally tell them that you have gone into hospital. This is so they do not think you have abandoned your home.

Your bank

You can ask your bank to send your bank statements to the hospital ward. Or you can ask them to be sent to a friend or relative that you trust. This will help you manage your money while you are in hospital.

Her Majesty’s Revenue and Customs (HMRC)

If you are receiving tax credits, you should tell Her Majesty’s Revenue and Customs (HMRC) about the change in your income as they may change your award. The Tax Credits Helpline number is 0345 300 3900.

I was working when I went into hospital. What happens to my pay?

If you work but you have to take time off because you are unwell, you could be entitled to sick pay. Your employment contract may say how much your employer will pay you and for how long. This is called ‘contractual sick pay’. You might need to give your employers a ‘fit note’ from a doctor to prove that you are unable to work. You can speak to your doctor if you need a fit note.

If your contract does not mention contractual sick pay, you may still be entitled to Statutory Sick Pay (SSP). SSP is the minimum amount your employer must pay you if you are unable to work due to sickness. SSP is paid for up to 28 weeks. If you are in hospital for more than 28 weeks you can make a claim for Employment and Support Allowance (ESA).

If your sick pay is less than your normal income, you may be entitled to tax credits and more benefits such as Income Support, depending on your circumstances.

You might be entitled to Housing Benefit (HB) if you rent your home, as well as Council Tax Support. You should contact your local authority about these benefits.

In some areas, you might claim Universal Credit (UC) instead of ESA and HB. The rules about benefits can be complicated. You can use a benefit calculator to see what you might be able to claim. There is a link to a benefit calculator further down this page. 

I was claiming benefits when I went into hospital. What will happen to them?

As we mentioned earlier it is important that you tell the DWP if you go into hospital. This is because some benefits stop after you have been in hospital for a certain amount of time.

Stage 1 – from day 1

Normally your benefits are not affected during your first 28 days in hospital. But if you were in hospital at any time in the 28 days before your current stay, then these stays will be linked. This means that the different times in hospital are linked together and count as one period.

Employment Support Allowance

While you are in hospital you will automatically meet the basic health criteria for claiming Employment and Support Allowance (ESA). If you are not claiming this benefit, and are not getting sick pay, you could think about making a claim.

Council Tax

If you are going into hospital for a long time and your property is empty it may be exempt from council tax. Or if your stay is more short-term you may get a reduction on your council tax. You need to let your local council know so that they charge you the right amount of council tax.

You may also be permanently exempt from paying council tax if you get certain benefits and a doctor confirms you have ‘severe mental impairment’.9 Speak to your local authority about this.

Stage 2 – after 28 days

Some benefits stop once you have been in hospital for 28 days. These are:

  • Disability Living Allowance (DLA)
  • Personal Independence Payment (PIP)
  • Attendance Allowance (AA)

If these benefits stop, your Income Support, Employment and Support Allowance (ESA), Universal Credit or Pension Credit may also be reduced. This is because some premiums depend on your entitlement to disability benefits.

When this happens, you or someone you know should tell your local authority. This is so they can look at your entitlement to Housing Benefit or Council Tax Support.

If your carer gets Carer’s Allowance, or the carer’s element of Universal Credit, their entitlement to this will stop when your DLA, PIP or AA stops

Stage 3 - after 52 weeks

Some benefits stop once you have been in hospital for 52 weeks. These are:

  • Housing Benefit
  • Support for Mortgage Interest

This means you would have to pay the full rent or mortgage payments on your home. If you do not pay the rent or mortgage you could be evicted.

If at any time in the 52-week period you spend one night at home the 52-week period will start again. This means you could receive HB for another 52 weeks

If you live with someone else, they may be able to claim these benefits if they also have to pay the rent or mortgage payments.

If you are concerned about losing your home you should speak to your local authority or mortgage provider.

Premiums

Sometimes if you are claiming benefits you get extra money added to your claim if you meet certain criteria. These are known as premiums. For example, the Severe Disability Premium is a premium you can claim on your ESA if you live alone and you are disabled.

Some premiums can still be paid for 52 weeks if you go into hospital. After this time, they will stop. This could mean that your benefit drops after you have been in hospital for 52 weeks, even if you are still eligible to receive benefits.

Couples

If you have a partner you will still be treated as a couple for benefits purposes for 52 weeks. After this time both of you will be treated as single claimants and you may need to reapply for benefits. Get advice from a welfare rights specialist if this applies to you, so you can understand what you need to do to make new claims for benefits. Your local Citizens Advice Bureau usually has a welfare rights specialist. Or they can let you know of other organisations that can help.

Income Support, Income-related ESA and Pension Credit

If you receive Income Support, income-related ESA or Pension Credit, this continues to be paid to you even if you are in hospital for over 52 weeks. However, after this you will lose any disability premiums. This means the amount you get will be less.

I claim Universal Credit (UC). How will this be affected?

Your UC is normally unaffected until you have been in hospital for more than six months. At present there is no information about what happens after 6 months. Get advice from a welfare rights specialist, or your local Job Centre, if this applies to you, so you can understand what you need to do.

Couples

You and your partner continue to count as a couple for UC for 6 months. After this time both of you will be treated as single claimants and you may need to reapply for benefits.21 This means that:

  • you can no longer make a joint claim for UC,
  • the calculation of your benefit no longer includes amounts for your partner, and
  • you should notify the DWP as you may have to reclaim UC as a single person.

How can I pay my bills if I am in hospital?

You can give someone else the right to access the money in your bank or building society account. To do this you need to ask your bank or building society for a ‘third party mandate’. You will need to sign this form. The person you want to be able to access your bank account will also need to sign the form. You then need to give this form to your bank or building society. This would allow a friend or relative to withdraw money from your account. They could then pay for certain bills for you. If you use a Post Office card account, a second card can be issued to the person who collects your benefit.

There are some payments you make each month which are more important than others. Priority payments include rent, mortgage, council tax, gas, electricity, TV licence, Magistrate’s court fines and hire purchase agreements. They are priorities because if you don’t pay them, you could lose something important. For example, if you don’t pay your rent you could lose your home.

Payments to credit cards, unsecured loans, catalogues, overdrafts and store cards are non-priorities. If you can’t afford to pay them your credit rating will be affected, but usually nothing will be taken from you.
It is generally possible to pay for most goods or services by direct debit or standing order. This is where money is taken directly from your bank account and sent straight to whoever you need to pay, usually around the same time every week or month. If you go into hospital, as long as you have the money in your account, then these payments will continue to be made automatically.

If you can’t afford your non-essential bills, you or a relative should write to the companies and explain why. Cancel any non-essential payments that are due to go out of your bank account.

Debt & Problems

Dealing with debt can be stressful. If you don’t feel well enough to manage this, you could give permission to your carer to deal with your debts for you. To do this, write a letter to your lender to confirm that you give your authority for someone else to deal with your affairs. There is a sample letter that you can use on our ‘Options for dealing with someone else’s financial affairs’ page. 

Some organisations provide free and confidential advice about debt. You can find more information about organisations that can help in the Useful Contacts section of the downloadable version of this page. 

Sometimes if you go into hospital, your mental capacity may be assessed. Your mental capacity is your ability to make decisions for yourself. If doctors think you lack mental capacity you will not be able to make decisions about your finances.

If you lose mental capacity for financial decisions you will not be able to agree repayments, make benefit applications or withdraw money from your bank account. You can find out more about mental capacity by visiting our mental capacity page.

 

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