The Nursing Homes Support Scheme (Amendment) Act 2021 was signed into law on 22 July 2021.  It introduces some significant changes in the way in which the scheme operates – see the official Press Release below and the links to the Act and the Explanatory Memorandum.  Please note that the Act shall come into operation 90 days after the date of its passing (ie approx. late October 2021).

Press release

Minister Butler welcomes signing into law of the Nursing Homes Support Scheme (Amendment) Bill 2021

From Department of Health, Published on 22 July 2021, Last updated on 26 July 2021

The Minister for Mental Health and Older People, Mary Butler TD, has today welcomed the signing into law of the Nursing Homes Support Scheme (Amendment) Bill 2021 by President Michael D. Higgins.

Minister Butler brought the Bill through the Houses of the Oireachtas and it successfully passed all stages of the Dáil and the Seanad last week with cross party support.

Minister Butler stated that:

“the new Act will amend the Nursing Homes Support Scheme, commonly known as Fair Deal, to enhance protections for family farms and businesses.”

This change to the Scheme will mean that after a period of 3 years, the value of family-owned farms and businesses will no longer be taken into account when calculating the cost of a person’s nursing home care. This will happen where a family successor commits to working the farm or business.

Minister Butler continued:

“This change is essential to the viability and sustainability of family farms and businesses. Ultimately, it seeks to alleviate any unnecessary financial pressures placed on these families by updating the current law. It will ensure that Fair Deal is fair for all, enhancing accessibility and affordability of the Scheme for more farm and business owning families.”

The new Act will also extend the existing 3 year cap on contributions to the cost of care to the proceeds of sale of a person’s principal residence. It is intended that this change will remove any disincentive for people who want to sell their vacant home while in Fair Deal.

Minister Butler concluded that:

“updating the Scheme, as quickly as possible, has been an absolute priority for me since I was appointed last July. Today marks a significant milestone with the signing into law of this hugely important piece of legislation. The changes will come into effect 90 days from today’s enactment and I am fully committed to ensuring its full and effective implementation.”

Notes

  • the Nursing Homes Support Scheme has been in operation since 2009
  • as of 31 December 2020, there were 22,755 people participating in the Scheme at an annual cost of just over €1 billion
  • participants in the Scheme contribute up to 80% of their assessable income and a maximum of 7.5% per annum of the value of assets held. In the case of a couple, the applicant’s means are assessed as 50% of the couple’s combined income and assets. The first €36,000 of an individual’s assets, or €72,000 in the case of a couple, is not counted at all in the financial assessment
  • the overall aim of the Nursing Homes Support Scheme is that participants contribute to the cost of their care according to their means, while the State pays the balance of the cost. Where an individual’s assessed weekly contribution is greater than the cost of care, they do not qualify for financial support. Therefore, applicants to the Scheme with substantial assets or incomes are unlikely to qualify for financial support
  • the capital value of an individual’s principal private residence is only included in the financial assessment for the scheme for the first 3 years of their time in care. This is known as the 3-year cap. Currently, this unqualified 3-year cap does not apply to productive assets such as farms and businesses, except in the case where a farmer or business owner suffers a sudden illness or disability and as a result requires nursing home care
  • this Bill seeks to address this issue by introducing additional safeguards in the Scheme to further protect the viability and sustainability of family farms and businesses that will be passed down to the next generation of the family
  • the proposed change is to cap financial contributions based on farm and business assets at three years, where a nominated family successor commits to working the productive asset for a period of 6 years
  • the Bill also extends the existing 3-year cap on contributions to the cost of care based on the value of a principal residence to the proceeds from the sale of that residence. As well as introducing further fairness – by treating the home and its proceeds in a similar way – in the context of the housing crisis, it removes a disincentive to selling a vacant home when someone moves to long-term care.