The new Nursing Homes Support Scheme is now in operation, having replaced the Subvention Scheme, and is already causing headaches for applicants and their relatives.
In 2004, the Government announced that the means by which it had been charging long-stay patients in public nursing homes for the cost of their care was contrary to the law and had to be replaced. The Government attempted to address the problem by rushing the Health (Amendment) (No. 2) Bill 2004 through the Oireachtas and by providing retrospective validity for historical charges. The presence of “(No. 2)” in the title of a bill is generally an indicator that it was born out of crisis or mishap.
The President convened a meeting of the Council of State to consider the Bill and later referred it to the Supreme Court to test its constitutionality, with the result that the Court found the Bill unconstitutional. The Supreme Court decision left the State open to claims for the repayment of illegally deducted charges and the HSE Health Repayment Scheme was established to deal with such claims.
The Govermment then set about replacing the Subvention Scheme with what was first known as the Fair Deal Scheme, a loaded phrase with which not all might agree, and which is officially titled the Nursing Homes Support Scheme.
Overview of the Scheme
The main features of the Scheme are that both State and patient contribute to the cost of long term nursing home costs and that the patient can defer part of that payment by obtaining a loan from the HSE. In summary:
- The HSE carries out a financial assessment to establish the patient’s rate of contribution. This can range to a maximum of 80% of the applicant’s income and 5% of the applicant’s assets, both contributions arising on an annual basis. However, the 5% asset contribution only arises in the first three years of care (ie. it is capped at 15% of the applicant’s assets).
- The first €36,000 of an applicant’s assets is exempted from the financial assessment (€72,000 in the case of a couple).
- The HSE loan (the official term is Ancillary State Support) will most commonly be used where the applicant’s main or only asset is the principal private residence. Obviously, the Scheme should not require the applicant’s home to be sold to contribute the annual 5% contribution, so that element of the contribution is deferred and recouped from the sale of that property or from the applicant’s estate after death.
- Whatever the rate of contribution by the applicant, it will never exceed the actual cost of care and all applicants will retain at least 20% of their income.
The Department of Health was anxious to ensure that the Scheme be a lawyer free zone; an understandable concern given its previous experience with the legality of nursing home funding schemes operated by it.
There is, of course, no reason why a solicitor should be required in order to apply to a State agency for receipt of an entitlement but two legal issues arise:
- the implications of the Scheme for an applicant’s assets must be considered; and
- what happens if the applicant is not in a position, due to illness, to apply?
The first issue can only be considered in the context of the applicant’s assets and personal circumstances. The Scheme may have unintended consequences and must be borne in mind when when dealing with assets, family transfers of property, when making a will or when executing an enduring power of attorney. For example, the financial assessment will look at income or assets which the applicant has deprived him or herself within the five years leading up to the application.
The second question is a topical one for solicitors, as the Scheme began to operate in early January. If the HSE loan is not required, a specified person may make an application on behalf of the applicant. A specified person is one of the following:
- the Committee of a Ward of Court, duly authorised;
- a person appointed by a registered enduring power of attorney which does not prohibit the attorney from making such an application;
- a Care Representative (within the meaning of section 21);
- a spouse or partner (within the meaning of the rather awkwardly phrased section 4);
- a relative of the person who is not less than 18 years of age;
- a next friend appointed by a court;
- a legal representative of the person; or
- a registered medical practitioner, a registered nurse or registered social worker.
These categories of person are specified in decreasing order of priority. If the applicant has diminished mental capacity, the specified person can make the application for State support. However, if an application for a HSE loan is made and the contribution from the applican’t assets to be deferred, it can only be made by one of the first three categories of specified person. More often than not, this requires the appointment of a care representative.
The appointment of a care representative is a limited form of wardship and is, therefore, subject to court oversight. It must be done on notice of motion to the Circuit Court, grounded by an affidavit sworn by the proposed care representative and accompanied by two independent reports, in a specified form, from medical practitioners (a bare letter from the applicant’s GP stating that the applicant has diminished mental capacity, for example, will not suffice).
The procedure to be followed and forms required are set out in these Circuit Court Rules and, while they would benefit from clearer drafting, are not overly complicated. The procedure is a good deal more complicated if the proposed care representative is, for example, a grandchild of the applicant. The procedure requires that documents be stamped and filed and the proposed care representative make a Circuit Court application in person. Many will be happy to do so but many more will not relish the experience.
Of course, the forms include the disclaimer: “You should consider taking legal advice on this document.” This is certainly the case as, if nothing else, errors or complications with the application process could delay it considerably and result in unnecessary stress for both the applicant and his/her family.