‘Fair Deal’ is a regular topic in the media since its announcement by Minister for Health, Mary Harney. The Nursing Homes Support Scheme Act 2009 (commonly referred to as ‘Fair Deal’) was signed into law on the 1st July 2009 and is expected to commence later this year, replacing the existing Nursing Home Subvention program.
The scheme is designed to remove real financial hardship for many individuals and their families who under the current system of Nursing Home Subvention, have to sell or re-mortgage homes to pay for the cost of nursing home care. Full details about this support scheme have not yet been finalised, however, the HSE have provided some details about this scheme on their website (www.hse.ie), a sample of which we will include below.
What are the main benefits of the new scheme?
- You will make a contribution to care costs, based on your means.
- The State will pay all the balance, in both public and private nursing homes.
- You will never have to sell or mortgage your home to pay for care.
- A spouse or dependent child will never have to sell or mortgage the home to pay for care.
- Family members will not have to provide cash from their own incomes to pay for care.
- The State will continue to pay for the majority of care costs overall.
How to calculate your new cost of care under the nursing homes support scheme:
The HSE website has provided some examples of how the scheme will affect people in a variety of circumstances. These examples are as follows:
Mr. Jones, Single, No Assets –Contribution to cost of Care= €175.20
Mr. Jones lives in a local authority house. His sole income is the State Pension (Non-Contributory), i.e. €219 per week. He owns no assets. Having being assessed by the HSE as needing nursing home care, he enters a private nursing home. Under the new scheme, as a new entrant to a nursing home, he will pay a maximum of 80% of his income, i.e. €175.20 per week, towards his cost of care. The HSE will pay the balance of the cost.
Ms. Byrne, Married, House – Weekly Contribution to cost of care = €176
Ms. Byrne lives with her husband in a house which they own. She now needs full-time nursing home care. They have a combined income of €440 per week. Their house is valued at €400,000. Under the new scheme, Ms. Byrne will pay €176 per week towards her cost of care. This is because half of the couple’s income is €220 and 80% of this is €176. The HSE will pay the balance of the cost.
A deferred contribution of €157.70 per week, for a maximum of three years, is payable from the estate after the death of both Ms Byrne and her husband. This is calculated as follows:
Value of house: €400,000
Less the Asset disregard for couple: € 72,000
Remaining Value: €328,000
50% of remaining value of couple’s house: €164,000
5% of 164,000 per annum: € 8,200
Divide by 52 to get weekly amount: € 157.70
If Ms. Byrne is still in nursing home care after three years, the principal residence would be discounted from the financial assessment.