Health Insurance Fair Deal Scheme/Nursing Home Loan Scheme

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trojan

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Are there any figures available to indicate what percentage of Fair Deal clients have opted to avail of the Nursing Home Loan Scheme to pay that part of the cost of their stay in a Nursing Home.
 
trojan said:
Are there any figures available to indicate what percentage of Fair Deal clients have opted to avail of the Nursing Home Loan Scheme to pay that part of the cost of their stay in a Nursing Home.
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As a matter of interest i see in todays Farm Finance section of Irish Examiner that up to end of 2014 10% of nursing care residents availed of the Loan option to cover their cost with debts totalling 34.9m euroes to be collected from their estates. In view of the cost of nursing home care this would suggest 90% of residents must have substantial funds to meet the cost from their own resources.
 
trojan said:
In view of the cost of nursing home care this would suggest 90% of residents must have substantial funds to meet the cost from their own resources.
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I don’t think 90% necessarily have substantial funds, many might have modest savings that they opt to use to pay the 7.5% liability on their family home for 3 years, rather than have a charge put on the family home, to be collected after their passing.

I am personally aware of many cases where elderly couples have a family home worth say €200K, and one of the couple needs nursing home care.

7.5% of half the value for 3 years is €22,500, this is within the modest savings bracket of many at that stage of their lives, and would be the preferred option rather than put a charge against the family home.

I also believe not opting for the loan substantially speeds up Fair Deal applications.
 
twofor1 said:
I don’t think 90% necessarily have substantial funds, many might have modest savings that they opt to use to pay the 7.5% liability on their family home for 3 years, rather than have a charge put on the family home, to be collected after their passing.

I am personally aware of many cases where elderly couples have a family home worth say €200K, and one of the couple needs nursing home care.

7.5% of half the value for 3 years is €22,500, this is within the modest savings bracket of many at that stage of their lives, and would be the preferred option rather than put a charge against the family home.

I also believe not opting for the loan substantially speeds up Fair Deal applications.
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Thanks Twofor1. I agree that if the house is only valued at 200k euro then there is probably no need for a loan in most cases especially when tax relief is factored in. However with house prices rising and a stricter valuation regime this situation may not continue in the years ahead. Thanaks
 
You will find the financial profile of NHSS participants on pages 87 & 88 here;

http://health.gov.ie/wp-content/uploads/2015/07/Review-of-Nursing-Homes-Support-Scheme.pdf

I am surprised how little cash and other assets the majority have, bear in mind though, only a small percentage of the population end up in long term nursing home care under Fair Deal, suggesting the vast majority remain at home or with family, possibly with home supports, or fund their own nursing home costs themselves.
 
Hi twofor1,
Do you know the answer ? my mother is in the process of entering a nursing home, currently in hospital.Her house has been valued at 350k and she has a life loan from seniors money with a current balance of 130k. We are going through the process of applying for the fair deal through the hospital and also applying for the loan, should we as my mothers 4 adult children pay for the loan ourselves or should we go for the fair deal loan ?
Is the 7.5% for 3 years payable up front or yearly ?
Is the 7.5% on the 350k - 130k or on the full 350k ,
What's the interest rate on the fair deal loan ?
Is it like a seniors money loan which compounds up each year ?
thanks.
 
GDUFFY said:
should we as my mothers 4 adult children pay for the loan ourselves or should we go for the fair deal loan ?
.
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It depends, not opting for the loan would speed up your application and there would not be a further charge against the property when the time came to sell.

Assuming your mother is the sole owner and was assessed on the lower €230k it would be €17,250 annually or €1,437 monthly for three years, can you and your siblings afford this ? it is tax deductible.

Another consideration is who gets the house when your mother passes, if all four get equal shares, then no problem but it would not be seem fair if all four were to pay this charge and the house (Or whatever is left after Seniors Money are paid) is then left to say only one.
 
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GDUFFY said:
Is the 7.5% for 3 years payable up front or yearly ?
Is the 7.5% on the 350k - 130k or on the full 350k ,
What's the interest rate on the fair deal loan ?
Is it like a seniors money loan which compounds up each year ?
thanks.
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We did not opt for the loan and paid the contribution based on the home directly to the nursing home on a monthly basis for three years.

I don’t know in your case if you will be assesed on €350K or €230K, ring your local NHSS office, I always found them very helpful.

There should be no interest if repayment is made within the specified timeframe.


Nursing Home Loan

The legislation underpinning the Scheme sets out specific timeframes for repayment of the loan (depending on what has caused the repayment to arise). As long as the repayment is made within the specified timeframes (that is, 12 months where repayment arises because the person in the nursing home has passed away and 6 months if the property is sold or transferred), interest does not have to be paid. If, however, repayment is not made within the specified timeframes, interest applies and the HSE will apply the Consumer Price Index to the loan to take account of the time value of money (that is, inflation or deflation) since the loan was made. The Revenue Commissioners notify people in advance of the deadlines of the need to pay on time so as to avoid paying interest


[broken link removed]
 
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twofor1 said:
I don’t know in your case if you will be assesed on €350K or €230K, ring your local NHSS office, I always found them very helpful.
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Meant to add the financial assessment will also look at assets that your mother has deprived herself of since applying for State support or in the 5 years before the application.

If the senior’s money loan was within the past five years then I think she will definitely be assessed on the higher €350K.
 
If the dependent has a few children that are paying tax at the top rate then it would be more prudent for them to pay it on their behalf as they get full tax relief. The cost can be split between any amount of children afaik.
My understanding of the scheme is that you will be liable for the first three years yourselves and after that up to 7.5% of the assets can be recovered by the HSE up to a max of three years after death. So you are liable for three years and then they can charge only to a max of three further years regardless of how many years they live for after this. Are you guys saying that after three years of paying themselves the HSE can recover nothing from the assets after death ? Sorry for going slightly off topic but I think this should be cleared up as part of the thread.
 
elcato said:
If the dependent has a few children that are paying tax at the top rate then it would be more prudent for them to pay it on their behalf as they get full tax relief. The cost can be split between any amount of children afaik.
My understanding of the scheme is that you will be liable for the first three years yourselves and after that up to 7.5% of the assets can be recovered by the HSE up to a max of three years after death. So you are liable for three years and then they can charge only to a max of three further years regardless of how many years they live for after this. Are you guys saying that after three years of paying themselves the HSE can recover nothing from the assets after death ? Sorry for going slightly off topic but I think this should be cleared up as part of the thread.
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My understanding is the reference to the 3 years is that the family home is only included for 3 years..thereafter if there are other assets then the relative rate will apply.
 
elcato said:
Are you guys saying that after three years of paying themselves the HSE can recover nothing from the assets after death ?
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Yes,

Your principal residence will only be included in the financial assessment for the first 3 years of your time in care, whether you apply for the loan or not, any other assets will be included in the assessment for your entire stay.

If you don’t apply for the loan you will be paying this part of your assessed contribution as you go along, and there will be no further liability when you pass away.

If you do apply for the loan, the HSE will pay this portion of your contribution for three years, and will recoup a maximum of 22.5% (3 years @ 7.5%) regardless of the length of time you spend in nursing home care, from the sale of your property after you pass away. Should you die after 2 years they will only recoup 15% etc.

You will find all the details in the Financial Assessment and Your Contribution To Care sections Here:

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Some examples of how it works can be found on pages 12-14 here;

http://health.gov.ie/wp-content/uploads/2014/03/AssessmentCapacity_FullGuidance.pdf
 
twofor1 said:
Yes,

Your principal residence will only be included in the financial assessment for the first 3 years of your time in care, whether you apply for the loan or not, any other assets will be included in the assessment for your entire stay.

If you don’t apply for the loan you will be paying this part of your assessed contribution as you go along, and there will be no further liability when you pass away.

If you do apply for the loan, the HSE will pay this portion of your contribution for three years, and will recoup a maximum of 22.5% (3 years @ 7.5%) regardless of the length of time you spend in nursing home care, from the sale of your property after you pass away. Should you die after 2 years they will only recoup 15% etc.

You will find all the details in the Financial Assessment and Your Contribution To Care sections Here:

[broken link removed]

Some examples of how it works can be found on pages 12-14 here;

http://health.gov.ie/wp-content/uploads/2014/03/AssessmentCapacity_FullGuidance.pdf
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Do You Know whether your financial assessment can change at any stage or once you enter into the Fair Deal Agreement is that the agreement you stick with (minus the house liability for three years) for your entire time in the nursing home. For instance what would happen if the wife /husband won the Lotto or inherited money, or had to spend a major amount of money to remedy some major problem in the house etc.
 
Page 1 on the application:

If my circumstances change?

You must advise the HSE within 10 working days if you or your partner’s circumstances change, as your financial support may be affected e.g. if your spouse/partner dies or you or your spouse/partner sell your property. Failure to advise the HSE may result in an overpayment of State support which must be repaid to the HSE. If a person does not notify the HSE of a change in circumstances, he/she is guilty of an offence and is liable for a summary conviction to a fine not exceeding €1,000.

http://www.hse.ie/eng/services/list/4/olderpeople/nhss/AppForm.pdf

It does not specifically mention the Lotto or big inheritances, but I would guess either would be notifiable changes and you would be reassessed.

Equally as savings lowered as a result of not opting for the loan, medical expenses, new car etc, I applied to have our contribution reassessed each year and it was never an issue, just sent in current bank statements and a rough explanation, our contribution was then reassessed on the now lower savings and we were then advised of our new lower contribution.
 
Hi two for one.
i didn't know you could reapply on a yearly basis. Parent in nursing home now almost three years and other parent paying over 2500 each month as that was assessed contribution including value of house payment. Naturally as paying almost 30,000 per year savings are diminishing but understood that was the agreed bill for the nursing home. When you reapplied are you now assessed at 15% rather than the original 10%. Must actually contact the Fair Deal Office to check it all out. Thanks
twofor1 said:
Page 1 on the application:

If my circumstances change?

You must advise the HSE within 10 working days if you or your partner’s circumstances change, as your financial support may be affected e.g. if your spouse/partner dies or you or your spouse/partner sell your property. Failure to advise the HSE may result in an overpayment of State support which must be repaid to the HSE. If a person does not notify the HSE of a change in circumstances, he/she is guilty of an offence and is liable for a summary conviction to a fine not exceeding €1,000.

http://www.hse.ie/eng/services/list/4/olderpeople/nhss/AppForm.pdf

It does not specifically mention the Lotto or big inheritances, but I would guess either would be notifiable changes and you would be reassessed.

Equally as savings lowered as a result of not opting for the loan, medical expenses, new car etc, I applied to have our contribution reassessed each year and it was never an issue, just sent in current bank statements and a rough explanation, our contribution was then reassessed on the now lower savings and we were then advised of our new lower contribution.
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twofor1 said:
Page 1 on the application:

If my circumstances change?

You must advise the HSE within 10 working days if you or your partner’s circumstances change, as your financial support may be affected e.g. if your spouse/partner dies or you or your spouse/partner sell your property. Failure to advise the HSE may result in an overpayment of State support which must be repaid to the HSE. If a person does not notify the HSE of a change in circumstances, he/she is guilty of an offence and is liable for a summary conviction to a fine not exceeding €1,000.

http://www.hse.ie/eng/services/list/4/olderpeople/nhss/AppForm.pdf

It does not specifically mention the Lotto or big inheritances, but I would guess either would be notifiable changes and you would be reassessed.

Equally as savings lowered as a result of not opting for the loan, medical expenses, new car etc, I applied to have our contribution reassessed each year and it was never an issue, just sent in current bank statements and a rough explanation, our contribution was then reassessed on the now lower savings and we were then advised of our new lower contribution.
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Do they reassess the price of the family home ? If so it could have increased rather dramatically.
 
Meath Lady said:
When you reapplied are you now assessed at 15% rather than the original 10%.
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Not sure what you mean by this.

My family member is in long term care under Fair Deal since late 09, so their contribution on the family home and other assets was 5% annually, with the family home disregarded after 3 years.

The last time I applied to be reassessed was January 2013; at that point their home was disregarded and their savings were below the threshold, so from then on the assessment was on 80% of income only, this is before the contribution was raised to 7.5% for new applicants (July 2013), so I cannot answer your question for certain but my understanding from others is if your original application was assessed at 5%, any future reassessments will be at 5%.

As you say, your Parent /s savings are dropping substantially each year, you should apply to be reassessed, 5% of €30K is €1,500 that your contribution should be dropping by each year, if you applied, well worth doing.
 
Your assistance would be appreciated.
My mother is in an nursing home under the fair deal scheme. She was financially assessed would have to pay up to €1200 per week based on the value of her home. The fair deal NTPF cost is €900 per week. However the private nursing home cost is €950 per week. We did not apply for the Fair Deal/ State loan and opted to pay ourselves. The nursing home is saying that because my mother would have to pay €1200 under the Fair Deal assessment that they can charge her the private rate of €950/week. Is this correct as fair deal states that "nobody will pay more than cost of care" and my understanding is Cost of Care is the cost as determined by NTPF!
 
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