Seán Canney (Galway East, Independent)
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209. To ask the Minister for Health the reason for the disparity in the rates of payment to private nursing homes nationwide; and if he will make a statement on the matter. [30784/21]

Seán Canney (Galway East, Independent)
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210. To ask the Minister for Health if he plans to change the assessment of the fair deal rate paid to private nursing homes from a by county basis to a care need basis; and if he will make a statement on the matter. [30785/21]

Mary Butler (Waterford, Fianna Fail)
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I propose to take Questions Nos. 209 and 210 together.

The Nursing Homes Support Scheme (NHSS), commonly referred to as Fair Deal, has been in place since 2009 as a system of financial support for people who require long-term residential care. Participants contribute to the cost of their care according to their means while the State pays the balance of the cost. In this way, for a decade, the scheme has ensured that long-term residential care is accessible and affordable for everyone who needs it.

Approximately 80% of nursing home places funded under the NHSS are in private or voluntary nursing homes that are funded by the State based on prices negotiated with the National Treatment Purchase Fund (NTPF). The maximum prices chargeable by private nursing homes for residents funded under the NHSS are agreed between each nursing home and the NTPF, which has a legally designated function to negotiate with nursing homes under the Nursing Homes Support Scheme Act 2009. The NTPF has statutory independence in this regard, agreeing rates with each nursing home according to a consistent set of criteria.

The current NTPF criteria for price negotiations are:

1. the costs reasonably and prudently incurred by the home and evidence of value for money;

2. the price(s) previously charged;

3. the local market price; and

4. budgetary constraints and the obligation of the State to use available resources in the most beneficial, effective and efficient manner.

Over 460 private nursing homes are registered with HIQA to operate as nursing home providers. It should be noted that public (HSE) nursing homes are not subject to the negotiation process; the HSE determines the cost of care for public nursing units.

The Review of the Nursing Homes Support Scheme, A Fair Dealhighlighted the need to re-examine the pricing mechanism used by the NTPF in relation to the NHSS. The Minister for Health subsequently requested that the NTPF carry out a review of the pricing system. A steering group was established with representation from various departments and agencies and expert advice and stakeholder submissions were sought.

The review, published in June 2021, makes four recommendations:

1. That the NTPF carry out a formal assessment of using a ‘formulaic approach’ in the pricing system.

2. That the NTPF carry out a formal assessment of amending the approach to the assessment of “Local Market Price” to reflect prices within other nursing homes within a certain distance of the nursing home rather than within the same county

3. That the NTPF engage with Nursing Homes Ireland to seek improvements to its appeals process

4. That the pricing system should be amended to better allow for the costs of high-dependency residents

Minister Donnelly and I have agreed to these recommendations and have requested that the NTPF commence implementation of the first two recommendations and engage with Nursing Homes Ireland on the third recommendation. The formal assessments are based on an approach whereby the NPTF will, in parallel with its normal negotiations, calculate a national price (for internal purposes) based on the 'formulaic approach' and the amended approach to 'Local Market Price'. These assessments will give an understanding of the cost impacts of any future change to the pricing system. The Department is also putting in place a longer-term programme of work to implement the fourth recommendation, which has multiple dependencies across the healthcare system. Given the size and scope of the NHSS (which had a budget of €1.04bn in 2021), implementation of all four recommendations must proceed with care as it is important that the Department has sufficient evidence and is assured of the likely impact of any changes.