The Government cap on care "does not include the cost of board and lodging", the care minister Norman Lamb told Daybreak.
Instead, the Government will set a cap on "the care that you need", such as "help with washing", the Lib Dem MP explained.
"Of course you would want to go further in having the cap lower - I understand that, we all want to do that, but it has to be sustainable.
"And the problem is we are all living longer and the costs of care keep escalating."
He added: "It's a bit rich for Labour to criticise it because over 13 years, they did absolutely nothing."
Caps on the cost of care in old age could be more than double what was expected in new measures proposed by the Government, according to Labour figures.
Calculations produced by the Labour Party show that pensioners could have to spend over £150,000 on care.
The Coalition has promised to set a legal limit of £72,000 on the sums that residents can be charged for care, saying the cap will prevent people having to raise funds by selling their homes.
But Labour say some costs such as accommodation and food won't be covered by the cap, leading to higher overall costs of care.
The British Medical Association has warned against amendments added to the Government's Care Bill, saying they would allow the Health Secretary to "force changes through the back door".
Referring to ministers' recent defeat over attempts to cut A&E and maternity services at Lewisham Hospital, Dr Mark Porter, chair of the BMA Council, said:
"As we saw with Lewisham Hospital any attempt to use the failure of a hospital to force through change at neighbouring trusts can result in unnecessary strain on services, patient uncertainty and a huge cost to the taxpayer.
Government plans to overhaul care are to be debated in the House of Commons today, amid criticism from doctors about certain aspects being "rushed through".
The Care Bill includes plans to give greater powers to a trust special administrator (TSA) and cap the cost of care to stop people having to sell their homes.
But the British Medical Association said TSAs will be empowered to also make changes in neighbouring trusts without consulting patients, clinicians, or the public.
The British Medical Association (BMA) said a proposal to make the wilful neglect of patients a criminal offence alone "will not help change to a culture of care within the NHS".
Dr Paul Flynn, chair of the BMA's consultant committee, said:
Plans to extend charges on migrants and short term visitors using the NHS is "impractical, uneconomic and inefficient", according to the British Medical Association (BMA).
Chair of the trade union, Dr Mark Porter, warned the NHS did not have the infrastructure or resources to implement the policy.
Government's proposals for an extended charging system for migrants and short-term visitors attempting to access healthcare in the UK could cause unintended damage to NHS services, the British Medical Association (BMA) has warned.
The group said there is no evidence that income from charging short-term visitors or migrants would be sufficient to cover the significant cost of the increased bureaucracy necessary to run the system.
The BMA has also warned that registering migrants at GP practices would increase the paperwork burden on already overstretched services.
Earlier this year, health officials revealed plans to charge foreigners who come to the UK hundreds of pounds a year to access NHS treatment.
The British Medical Association has warned that the NHS non emergency 111 number is being introduced to the public "too quickly".
Speaking to Daybreak, Laurence Buckman from the BMA said: "If you're not going to [run the service] properly, you don't have doctors and nurses at the centre of it, it won't work."
He added: "It's going to be dangerous, and somebody somewhere is going to be harmed as a result."
Health experts have asked Sir David Nicholson to delay the launch of the new telephone triage system NHS 111, as they say the crisis affecting the system will put patient safety at risk.
The phone number, designed to direct people with non threatening conditions to the right part of the NHS, will be launched nationwide on Monday.
But the British Medical Association said problems had occurred during the trialling of the number.
They added that in some areas, switchboards could not cope with the volume of calls, which had also been affected by severe IT failures.
In a statement, the NHS said: "We are confident that measures now in place will ensure resolution of these early problems."