Parents assume that after their passing the family home and any assets they have will be passed into the trust for their child with additional needs and/or divided by their other children. However, the reality is that the next generation of people to enter the Fair Deal scheme will be paying a large proportion of their assets to the government.
What is the Fair Deal Scheme?
The Fair Deal Scheme is also known as the Nursing Homes Support Scheme, which, provides financial support to people who need long-term nursing care. As parents, we all hope never to need this but the reality is that lots of us will fall into the scheme. Under this scheme, you make a contribution towards the cost of your care and the State (HSE) pays the balance. The scheme covers approved private nursing homes, voluntary nursing homes and public nursing homes.
Yes, the dreaded word pops up again. Just like when you applied for Carers Allowance or Medical Card, the Fair Deal scheme is also means tested. But this time your family home is classified as an asset. As well as any pension, savings, second properties, etc. If it has value then it will form part of the means test. The purpose is to see how much you will have to pay towards your care. If it is found that you don’t have sufficient means to meet the full cost then the HSE will pay the balance.
This is such an important area and I believe very few parents are discussing this area with their solicitor. This may have a big bearing on when you open up your child’s trust and how you are going to fund it. Because if you divest yourself of any asset over 5-years before entering the scheme then it will not be means tested.
This is my first of many articles I can see myself writing about over the coming years as the government continues to deal with the issue of an ageing population, that are living longer and need more medical care and interventions.
For more information, you can check out the HSE website https://www.hse.ie/eng/services/list/4/olderpeople/nhss/#fin