Care homes will be given Treasury-funded "time-limited" insurance cover to encourage them to take more Covid patients discharged from hospitals.
It comes after the Government sparked concerns by updating its official guidance to allow "non-infectious" hospital patients to be discharged into care homes without needing a Covid test in the 48 hours prior.
In a written statement, Nadhim Zahawi, the vaccines minister, said on Tuesday that the Government "will introduce a targeted and time-limited indemnity offer to fill gaps in commercial cover" for care homes that are prepared to admit Covid-positive patients.
For months, providers have highlighted problems insuring themselves against claims of clinical negligence, amid calls for the sector to be given indemnity like the NHS.
Acknowledging that "obtaining sufficient insurance has been a barrier", Mr Zahawi said the cover would last for around eight weeks until mid-March. But the Government has not yet clarified when the scheme will launch or how providers can sign up for cover, or revealed the eligibility criteria.
Some have questioned whether the measure will adequately ease the NHS capacity crisis because care home owners are so reluctant to accept residents where there is a risk of introducing coronavirus.
The widely-criticised policy was blamed for care homes accounting for roughly half of all excess deaths – 25,374 – between March 7 and September 18, according to the Office for National Statistics.
Mike Padgham, the chairman of the Independent Care Group, said care providers would "need the insurance to last for longer" and questioned why it did not include business interruption cover. "If a care provider had an outbreak of Covid and has to close temporarily, indemnity insurance wouldn't cover the loss of income," he said.