Thousands of applications have been received for the government’s long-awaited Fair Deal scheme since it came into effect last year, yet concerns remain about the scheme’s effectiveness.
The scheme, which is officially called the Nursing Homes Support Scheme, was introduced by Minister for Health and Children Mary Harney in late October. It replaced the former subvention system for all new entrants to nursing homes.
The premise of the recently introduced scheme is that older people contribute towards the cost of their care, with the level of contribution depending on income and assets, with the state paying the balance. This applies whether the nursing home is public, private or voluntary.
Harney’s scheme proposed that no one would be forced to sell their home to pay for care, and guaranteed that the income and assets of adult children would not come within the scope of the scheme’s financial assessment.
However, just over four months after its introduction, the supposed panacea for the financial burden of nursing home costs has yet to convince groups representing older people.
‘‘Processing has been slow so far,” said Eamon Timmins, of Age Action. The latest formal figures from the Health Service Executive (HSE) showed that 6,231 applications had been made to the scheme by the end of January and so far, just 2,254 of these had been processed, with a decision issued to the applicant.
However, a spokeswoman for the HSE said that, while more up-to-date figures were yet to be formally collated, initial estimates indicated that applicant numbers had reached almost 7,000. ‘‘It is estimated that approximately 3,500 applications have been approved to date,” she said.
According to the HSE, the vast majority of applications were being approved. ‘‘Very few, probably less than 1 per cent, have been refused to date,” said the spokeswoman.
Aside from the pace of processing, concerns have also been raised about the scheme’s requirement that 80 per cent of a person’s income goes towards the cost of care. ‘‘It leaves people on low incomes with very little in their pocket,” Timmins said. In his view, this is especially pertinent, since the Fair Deal scheme covers such basic costs as bed and board in a nursing home, but does not cover certain additional costs, such as physiotherapy.
Mairead Hayes, chief executive of the Irish Senior Citizens Parliament (ISCP), said she was also concerned about this element of the scheme. ‘‘A lot of essential treatments are not being provided for,” she said.
Costs such as social programmes, physiotherapy, incontinence wear, transport and specialised wheelchairs are not covered by the scheme.
Hayes said that older people living in nursing homes needed to have a level of financial independence and, as well as being able to pay for essential services, also needed to have some ‘‘pocket money’’ to fund discretionary spending such as newspapers, a haircut or presents for family members.
In her view, a lower income person could find it hard to retain financial independence, and pay for additional services required with the 20 per cent of their income left under the scheme’s rules.
A budget of close to €1 billion has been set aside for the Fair Deal scheme. ‘‘The budget in the revised estimates for 2010 was €979.212million,which includes additional funding this year of €152 million over and above last year,” said the HSE’s spokeswoman. To date, more than €10 million of the total fund has been paid out.
Applying for support
Anyone who is ordinarily resident here – meaning they have lived in Ireland for at least a year – can apply for support under the scheme. There is no upper income threshold, but your income and accumulated assets will determine how much you contribute towards the cost of your care.
In the first stage of the application process, you must undergo a care needs assessment to decide whether you require nursing home care.
This will normally be undertaken by a nurse appointed by the HSE. It is designed to consider your ability to carry out basic activities – such as dressing, bathing and moving about. It will also take account of your wishes and the supports available to you.
In some cases, where an individual has a limited ability to make decisions, an application may be made on their behalf by a spouse, relative aged at least 18, a person with power of attorney or a care representative.
Under the Nursing Homes Support Scheme Act, the Circuit Court may appoint a care representative to act on behalf of an applicant of diminished mental capacity who wishes to avail of the nursing home loan option.
Next, you must complete a financial assessment to determine how much you will pay. This considers both your regular income and any assets you have accumulated.
You are required to contribute 80 per cent of your income and 5 per cent of the value of your assets per annum.
Your income is deemed to include any salary, pension or social welfare benefits, as well as rental income, dividends and interest from savings.
The first €36,000 of your assets for a single person, or €72,000 for a couple, are excluded from this calculation.
In terms of savings, shares and property will be assessed, as well as any assets that you disposed of in the five years before making your application.
For couples, when one partner requires nursing home care, the financial assessment will be based on half of the couple’s combined income and assets. Where adult children are looking after an elderly parent, the income and assets of the children are not included. The scheme is divided into two levels of support – basic state support and ancillary support.
The basic support relates to the state’s contribution towards the person’s nursing home costs, while the additional support relates to a deferred loan secured against the person’s principal private residence.
If the loan option is chosen, the person will have to complete a third stage in the application process.
Basic applications are currently taking between two and four weeks to approve, according to HSE statistics. However, applicants who wish to be considered for ancillary support in the form of a deferred loan can expect to wait up to six weeks for their application to be processed.
What you contribute
Individuals will contribute a maximum of 80 per cent of their assessable income, as determined by the financial assessment.
If you have any assets over the €36,000 to €72,000 threshold, you will also contribute 5 per cent of their value each year.
When your contribution does not meet the cost of care, the state steps in to meet any shortfall between the cost of care and your assessed contribution.
This means the state will pay nothing if the person’s own contribution covers the full weekly cost of care.
If your assets include land and property, the 5 per cent contribution can be deferred and collected from your estate.
To apply for this ancillary support, you must apply for what is called a nursing home loan. This will involve the HSE registering a simple type of mortgage against your house.
Your home will be included in the financial assessment only for the first three years that you spend in care, so a total of 15 per cent of the value of your home may be paid towards the cost of your care.
This cap applies regardless of whether you opt for the deferred loan or not.
‘‘We are opposed to the idea that people use a proportion of their house towards the cost of their care,” Hayes said. She said that her members are unhappy that the scheme considers the value of someone’s home in determining the total value of their asset, especially given that this applies for three years.
‘‘Their home is considered beyond the two-year average nursing home stay,” she said.