How the Fair Deal Scheme Works
The Fair Deal Scheme, officially known as the Nursing Homes Support Scheme (NHSS), is the principal government initiative designed to help Irish residents cover the costs of long-term nursing home care. The scheme calculates your contribution based on your financial situation, with the remaining cost covered by the Health Service Executive (HSE). This support is available for care in approved public, private, and voluntary nursing facilities.
Application Process
Applying for the Fair Deal Scheme involves several steps administered by the HSE.
- Submit Application: The Nursing Home Support Scheme application form must be completed and is available from the HSE.
- Care Needs Assessment: A healthcare professional determines if long-term residential care is necessary based on your daily living abilities and cognitive function.
- Financial Assessment: The HSE evaluates your financial resources to calculate your expected contribution.
- Receive Outcome and Choose Home: Upon approval, the HSE informs you of your calculated contribution. You can then select an approved nursing home, and your payment amount remains consistent regardless of the facility's overall cost.
Calculating Your Financial Contribution
The Fair Deal Scheme's financial assessment considers both income and assets, with certain amounts disregarded.
- Income Contribution: Annually, 80% of your assessable income is included in the contribution. For couples, 40% of their combined assessable income is used. Allowances are made for taxes and specific health expenses.
- Asset Contribution: Each year, 7.5% of the value of your assets is included. However, the initial €36,000 in assets for a single person (or €72,000 for a couple) is excluded from this calculation. Couples contribute based on 3.75% of their combined assets.
- Three-Year Cap on Property: A key protection within the scheme is the three-year limit on the contribution derived from the value of your primary residence, farm, or family business. This means that the asset-based contribution from these properties ceases after three years, even if you continue to receive care.
The Optional Nursing Home Loan (Ancillary State Support)
Individuals with assets in land or property can opt for the Nursing Home Loan to postpone their asset-related payments. Under this arrangement, the HSE covers this portion of the cost, and the amount is recouped from your estate following your death or the sale of the property. This facility offers flexibility and can help prevent the need to sell your home immediately to fund care.
Paying Privately
Another option is to pay for nursing home care privately, without utilizing the Fair Deal Scheme. This method involves using personal financial resources such as savings, pensions, or by selling assets. Paying privately can provide faster access to care, bypassing the HSE's application and assessment timeline.
Claiming Tax Relief
Those funding nursing home care privately may be eligible for tax relief. This is claimed under the standard tax relief provisions for medical expenses. Relief can be sought at your highest tax rate for fees paid for yourself or a relative.
Fair Deal Scheme vs. Private Payment Comparison
| Feature | Fair Deal Scheme (NHSS) | Private Payment |
|---|---|---|
| Financial Assessment | Required. The HSE assesses income and assets to determine your contribution. | Not required. You fund care directly from your own financial resources. |
| Funding Source | Your calculated contribution, with the HSE paying the balance. | Personal savings, pension, income, or the sale of assets. |
| Nursing Home Choice | Limited to approved public, private, and voluntary homes under the scheme. | Can choose any nursing home, though availability may be limited. |
| Application Process | Involves a care needs assessment and financial assessment, with potential waiting lists for funding. | No formal application to the HSE required, potentially allowing for faster admission. |
| Property Protection | The value of your home is only assessed for the first three years, and a loan can defer payments. | Asset-based payment is managed entirely by you and your family. |
| Tax Relief | Tax relief is a separate claim and may vary depending on the Fair Deal Scheme. | You can claim tax relief on fees under the general medical expenses scheme. |
| Repayment | If the Nursing Home Loan is used, repayment is from your estate after death. | No repayment to the state is necessary; payments are made directly to the nursing home. |
Conclusion
Funding nursing home care in Ireland primarily involves two paths: the state's Fair Deal Scheme or private payment. The Fair Deal Scheme, managed by the HSE, determines your contribution based on income and assets, with the state covering the rest and offering protections like the three-year cap on property assessment and an optional loan. Private payment provides greater flexibility and potentially faster access but requires the individual or family to bear the full cost, although tax relief may be available. Consulting with a financial advisor and contacting the local Nursing Homes Support Office is advisable to explore the best option for individual circumstances.
Visit Citizens Information for comprehensive details on the Fair Deal Scheme.
