Áine Brady (Kildare North, Fianna Fail)

I am pleased to have the opportunity to introduce to the House Second Stage of the Nursing Homes Support Scheme Bill 2008. The Bill will put in place a new scheme of financial support for those in need of nursing home care. It aims to ensure that care is affordable for each person and to be fair to all. Before detailing the provisions of the Bill, I wish to begin by examining the wider policy vista and the reasons for introducing this Bill.

Government policy on older people long has been to support older people to live in dignity and independence in their own homes and communities and, when this is no longer possible, to support access to quality nursing home care. At present the State supports people in public and private nursing homes very differently. In a public facility, the State meets approximately 90% of the cost of care, while in marked contrast, the State effectively meets only 40% of the estimated average cost of care in a private facility. This discrepancy is wholly at odds with the principle of equity endorsed by the Government. It also is unfair to individuals and their families.

At present, an individual who obtains a public nursing home bed may be charged a maximum of up to 80% of the non-contributory State pension towards the cost of care. By contrast, the same individual availing of a private nursing home bed may be entitled to a subvention but is otherwise obliged to meet the full cost of his or her care. This can amount to as much as €1,200 per week. In addition, applicants for subvention are subject to stringent means testing and may be deemed ineligible for subvention based on the means test. This is in marked contrast to the current public system under which an individual may never be charged more than 80% of the non-contributory State pension, regardless of his or her level of means. The capped public charge is also regressive since better-off people pay a much lower proportion of their income towards the cost of their care. The net result is that many people in private nursing homes face uncertainty and unaffordable care costs. Some must sell or remortgage their family homes to pay for the cost of nursing home care, while others must turn to family and friends for assistance in meeting care costs.

In short, the present situation is unfair and unsustainable. It is deeply unfair that people of the same means face radically different costs for nursing home care, depending on where they live or whether their nursing home is public or private. It is deeply unfair that one person and his or her family with modest means could face very high bills to pay for care, while another might pay relatively little even though he or she had substantial means and assets. It is deeply unfair and unsettling that so many people and their families had no other option but to sell the family home to pay for care. All that will change with this legislation.

The genesis of the legislation may be traced back to 2005 when my colleague, the Minister for Health and Children, in conjunction with the Minister for Social and Family Affairs, established an interdepartmental working group on long-term care. The group examined the range of benefits, services and grants relating to long-term care for older people and examined policy options for a financially sustainable system of long-term care. It reported to the Government in January 2006. The group's recommendations informed the current social partnership agreement, Towards 2016.

That agreement reaffirms Government policy to support older people to live with dignity and independence in their homes and communities and to support access to quality residential care when needed. It also contained the following principles to guide the development of future policy on long-term care for older people. All relevant public services should be designed and delivered in an integrated manner centred on the needs of the care recipient and based on a national standardised needs assessment. Care needs assessments should be available on a timely, consistent, equitable and regionally balanced basis. The use of community and home-based care should be maximised and should support the important role of the family and informal care. When community and home-based care is not appropriate, quality residential care should be available. In addition, there should be appropriate and equitable levels of co-payment by care recipients based on a national standardised financial assessment. The level of State support for residential care should be indifferent as to whether that care is in a public or private facility and no current resident of a nursing home, public or private, should be put at a disadvantage by whatever new co-payment arrangements for residential care are introduced.

The proposed nursing homes support scheme, a fair deal, is consistent with the aforementioned principles. It will put in place one transparent system of support towards the cost of nursing home care. For the first time, there will be a uniform system of financial support for individuals in public and private nursing home beds. In short, its key objectives are to equalise State support for public and private long-term care recipients, to render private long-term care affordable and anxiety-free and to ensure that no one must sell his or her home during his or her lifetime to pay for care. These objectives have informed the approach taken throughout the Bill.

The Government announced the fair deal in December 2006. At the time, it gave a number of basic commitments regarding the new scheme, which I will outline. Individuals will contribute towards their cost of care based on their income and assets. The HSE will meet the balance of cost in nursing homes approved for the purpose. Individuals will not be obliged to sell or mortgage their house or borrow to pay for their care. Individuals will not experience unaffordable care costs. An individual's family will not have to find money for his or her care. As with the overall objectives, these commitments remain in place and underpin the provisions in the Bill.

I propose to briefly outline the main provisions of the Bill. Section 3, which sets out the scope of the scheme, defines certain terms used in the Bill. I draw the attention of the House to the definitions of "long-term residential care services" and "approved nursing home", which essentially circumscribe the scope of the scheme. "Long-term residential care services" are defined as maintenance, health and personal care services provided in designated public and voluntary facilities and approved private nursing homes. Services must be provided for not less than 30 consecutive days, or periods aggregating not less than 30 days, within a period of 12 consecutive months. For the sake of clarity, the definition explicitly excludes certain services, such as respite care services. To qualify as a designated facility, a public or voluntary facility will have to be designated in writing by the HSE as being a facility that is predominantly for the care of older people and will have to provide 24-hour rostered nursing care. To qualify as an approved nursing home, a private facility will have to the do the following: be registered under the appropriate legislation, reach an agreement with the National Treatment Purchase Fund on the maximum prices to be charged for care under the scheme, be tax compliant and provide 24-hour rostered nursing care. Another key term used in the Bill is "financial support". This encompasses straightforward financial assistance towards nursing home costs - such assistance is referred to as "State support". It also encompasses the option to defer payment of certain contributions during one's lifetime - this is referred to as "ancillary State support".

Section 4 of the Bill defines a "couple" for the purposes of the scheme. A couple is defined as a married couple or as a heterosexual or same sex couple who have been cohabiting as husband and wife for at least three years. In each case, the couple must have been habitually living together at the date of applying for State support or at the date of beginning to receive care services. Section 5 establishes the nursing homes support scheme and stipulates that the scheme is resource-capped. Therefore, the scheme is premised on the principle of eligibility rather than entitlement. Section 6 provides that eligibility for the scheme extends to those who are ordinarily resident in the State. In other words, the scheme is not limited to older people. Section 5 also enshrines the principle of patient choice in the legislation. Applicants who are deemed to require long-term residential care shall be informed of the names of all public and approved private nursing homes. They may select their home subject to its suitability to meet their needs and the availability of a bed at the home.

Sections 7 and 8 provide for the arrangements for care needs assessments. Section 7 provides for a care needs assessment to be conducted to ascertain whether a person needs to be provided with long-term residential care services. It stipulates who may carry out such an assessment and what factors may be taken into account in the assessment. These factors include the person's ability to carry out the various activities of daily living and the medical and social supports that are available to the person. Section 8 sets out the basis for unsuccessful applicants to seek a review of care needs.

The regulations governing financial assessments are set out in sections 9 and 10 and Schedule 1. Sections 9 and 10 provide for an application for State support and a subsequent financial assessment of means to establish the contribution an individual may have to pay towards the cost of his or her care. Section 10 stipulates that the assessment shall be carried out in accordance with Schedule 1. Parts 1 and 3 of Schedule 1 set out the rules for calculating the contribution payable by a single applicant. In summary, a person will make a contribution of up to 80% of his or her income and up to 5% of the value of his or her assets, after deductions and safeguards have been applied. Parts 2 and 3 of Schedule 1 outline the rules governing the contribution to be paid by a member of a couple. In this case, the assessment is based on the principle that each member of the couple owns 50% of the couple's combined means. Therefore, a person who is a member of a couple has an annual assessed contribution of 40% of the couple's combined income, or 80% of half the combined income; and 2.5% of the couple's combined assets, or 5% of half the combined assets.

The Bill contains a number of safeguards to protect the income and assets of care recipients and their spouses or partners, as well as the residual value of the principal residence. The use of the "minimum retained income threshold" will ensure that a person entering care will retain at least 20% of the maximum rate of the State non-contributory pension, while his or her spouse or partner who remains at home will retain at least the maximum rate of the State non-contributory pension. The "general assets deductible amount", or asset disregard, will stand at €36,000 for an individual or €72,000 for a couple. The cap on the principal private residence will ensure that contributions based on the residence will be payable for the first three years of care only. This is often referred to as the 15% cap. A new provision that was inserted on Report Stage in the Dáil will extend the three-year cap to farms and businesses in certain circumstances. This will apply to a person who has suffered a sudden illness or disability that caused them to require long-term residential care; if the person or their partner was actively engaged in the daily management of the farm or relevant business, as the case may be, until the time of the sudden illness or disability; and if a family successor certifies that he or she will continue the management of the farm or relevant business, as the case may be.

Sections 11 to 14, inclusive, set out the basis for determining applications and paying State support. They provide that, subject to resources, the State will pay the full difference between the total cost of care services and a person's contribution. This State support will be paid directly to the relevant nursing home on behalf of the person. In the case of existing residents whose nursing homes are approved under the scheme, State support will be paid from the date of full commencement of the legislation.

Sections 15 to 18, inclusive, and 28 provide for ancillary State support, which is another important feature of the scheme. Ancillary State support is an additional support that is designed to ensure that people do not have to sell assets, such as their homes, to meet their care costs. It enables people to defer contributions payable on Irish land-based assets for the duration of their lifetimes. It may be thought of as a loan advanced by the HSE and recouped at the settlement of the person's estate. The payment of ancillary State support is subject to a charging order being placed against the assets of the person to secure the amounts advanced. The HSE will register the charging order in the Registry of Deeds or the Land Registry, as appropriate. Section 28 provides for the discharge of such charging orders as soon as the amount advanced as ancillary State support has been repaid. The Bill provides that ancillary State support will be paid directly to the relevant nursing home on behalf of the person and that it may be paid to a person even though that person does not qualify for State support.

Sections 19, 20 and 26 relate to repayment. Section 19 of the Bill stipulates the events which trigger the repayment of ancillary State support. These are termed "relevant events" and principally include the death of the person or the sale or transfer of the asset concerned. Section 20 provides for a further deferral of the repayment of ancillary State support in the case of the principal private residence. Those who can avail of such a deferral are the spouse or partner of the original applicant and, in specified circumstances, certain relatives referred to as "connected persons". People in the latter group can avail of a deferral if the asset in question is their only residence; if they have lived there for not less than three years preceding the original application for ancillary State support; and if they do not have an interest in any other property. Those classified as "connected persons" include the following: a child of the original applicant, or their spouse or partner, who is under the age of 21 or whose assets do not exceed the asset disregard; a sibling of the original applicant whose assets do not exceed the asset disregard; relatives in receipt of certain State payments or with income below the State non-contributory pension; and any person who cared for the applicant prior to the latter entering the nursing home. This is defined by reference to relevant caring-related State payments. Where a person avails of section 20, repayment will be deferred for the duration of his or her lifetime, unless he or she ceases to qualify as a connected person or the asset in question ceases to be his or her principal residence. Section 26 provides that the Revenue Commissioners will be the collection agents for the repayment of ancillary State support.

Part 4 of the Bill provides for an innovative new feature within the scheme. It provides that a person may apply to the Circuit Court to be appointed as a care representative of a particular person. The appointment of a care representative is only necessary where a person does not have full capacity and wishes to avail of ancillary State support. However, a person appointed as a care representative may assist with any matter relating to the scheme.

The Bill adopts a function-based approach to determining capacity which is consistent with the recommendations of the Law Reform Commission. Under section 21, a person is considered to lack the capacity to make a relevant decision if he or she is unable to understand the information relevant to the decision, retain that information, use or weigh that information as part of the process of making a decision, or communicate his or her decision by any means. A person must be certified by at least two registered medical practitioners as lacking the capacity to make a relevant decision in order for a care representative to be appointed. The individuals who may apply to be appointed, either singly or jointly, as a care representative are the spouse or partner of the person; a parent, child, brother or sister of the person; a niece, nephew, grandchild, grandparent, aunt or uncle of the person; a person appearing to the court to have a good and sufficient interest in the welfare of the person, other than the proprietor of a nursing home in which the relevant person resides or is likely to reside.

Section 22 is a technical provision. It amends the Courts and Court Officers Act 1995 to allow for the appointment of care representatives by county registrars in uncontested cases. Sections 23 to 25 provide for the notification of certain specified matters, including the death or discharge of a nursing home resident, the death of a resident's partner or a connected person or a material change in the circumstances of a resident, his or her partner or connected person.

Section 27, concerning the schedule of assets, applies to a deceased person to whom financial support was provided or to whose partner financial support was provided. The personal representative of such a deceased person must provide the HSE with a written notice of his or her intention to distribute the deceased's assets and a schedule of such assets at least three months before beginning to distribute the assets. The HSE has the authority to request that sufficient assets be retained to repay any amount due to it. This is consistent with social welfare legislation.

Section 29, on joint ownership, is a technical provision that ensures a charging order in respect of ancillary State support shall not cause the severance of a joint tenancy or be rendered void due to the absence of the prior consent of the other joint tenant or tenants. The section seeks to protect both the interest of the HSE and the other joint tenants.

Sections 30 to 32 concern reviews and appeals. A person or the HSE may seek a review of the person's care needs, financial assessment or the amount of ancillary State support payable. In addition, a person may appeal certain decisions of the HSE, including decisions taken in relation to his or her care needs and application for State support. A person may also appeal the inclusion of income and assets transferred prior to 9 October 2008 in the financial assessment on grounds of hardship.

Section 33 is essentially a technical provision ensuring the existing legal basis for charges, including the exclusion of certain care groups from charges, is maintained. An amendment made to this section on Report Stage in the Dáil ensures the basis for public bed costs and, by extension, charges will be laid before the Houses. This underscores commitments already given in the context of the scheme in regard to transparency.

Section 34 is essentially a technical provision. In line with the Government's commitment, it ensures existing public residents will not be made worse off as a result of the new scheme. It also provides that a person in an acute hospital bed who has finished his or her acute phase of care and his or her care needs assessment may be charged as if he or she were receiving long-term residential care services. This provision is necessary to ensure there is not a legal incentive to remain in an acute hospital bed following discharge.

Part 9, including sections 35 to 48, contains a number of miscellaneous provisions. These include technical and standard provisions concerning the making of regulations, the maintenance of records etc. They also include transitional provisions providing that the nursing home subvention scheme will cease for new applicants from the full commencement of the legislation but that existing private nursing home residents can remain on subvention rather than transferring to the new scheme, if they so wish.

I draw attention to sections 40 and 41 which empower the National Treatment Purchase Fund to negotiate prices with private nursing home providers for the purpose of the scheme. Section 43 renders explicit the common law principle that a person providing necessary services for a person of diminished capacity for the latter's benefit may expect to be paid for such services.

I have detailed the key provisions contained in Schedule 1 and will conclude by clarifying the final part of the Bill, Schedule 2. Schedule 2 sets out the procedure for adjusting the amounts repayable in respect of ancillary State support. This adjustment will reflect the level of inflation, as measured by the consumer price index, between each year in which contributions were deferred and the year in which the debt falls due. In other words, the State will take account of the time value of money.

The Bill is fundamental to meeting the commitment given in Towards 2016 that State support should be equal for public and private care recipients. Critically, it offers assurance to the most vulnerable of groups in society - those in need of long-term nursing home care - that such care will be affordable and will remain affordable for as long as they need it. I commend the Bill to the House and look forward to hearing the views of Senators.