HOW FAIR DEAL WORKS

THE Fair Deal scheme works on the basis that the State pays for the care and the patient contributes to the cost from their income and/or assets.

The person’s financial situation is assessed to see how much they can contribute.

If the contribution is less than the amount of the fees, the HSE will pay the rest.

Assets, such as savings and property or land, are taken into account when assessing the person’s financial situation.

People can apply for what is called a ‘nursing home loan’ if they want to defer making the part of the contribution based on their home or other property.

The first €36,000 of savings is excluded and if the person’s spouse is still living in the home, only half the income or assets are taken into account.

Patients pay 80pc of their total income, such as a pension. On top of this, they have to commit 7.5pc of the value of their assets as a yearly contribution.

The family home asset is capped at three years, which is 22.5pc.

The cap was 15pc for applications made before 2013.

This payment can be deferred until after the death of the patient or their spouse.

The changes being envisaged in relation to the upcoming Budget relate to the issue of the three-year cap on the family home.

At present, the farmer or business person’s principal private residence will only be included in the financial assessment for the first three years. Beyond this period, the value of the property is exempt from assessment.

In practice, it means that the nursing home patient must pay a 7.5pc contribution every year on the value of the residence itself – with the surrounding farm land and business premises being subjected to an indefinite charge.

There are exceptions, however.

The three-year cap does not apply to farms or business assets in cases where the owner becomes ill or disabled suddenly and there is a family successor identified. This designated person must be a relative, according to the guidelines laid down.

Also, if a farmer has leased out the land they own when they apply for the Nursing Home Loan, the threeyear cap does not apply. And if a farmer’s health condition deteriorates, the three-year cap is not applied.

According to the Irish Farmers’ Association (IFA), the lack of a cap to date can have serious implications for the viability of a family farm for the next generation.

But the decision now to introduce the same rules applied to the home to the assets or farm will reduce the bills facing farmers and business owners. The rules will be spelled out in detail by Older People Minister Jim Daly (above) in the coming weeks and are likely to form part of the Budget.