I know I keep saying this too often that as you age, you should consider taking out an Enduring Power of Attorney. This is vital for you as your nominated Attorneys will be able to make financial decisions on your behalf and access your funds and assets if you are ever in a situation wherein you are physically or mentally incapable of doing it on your own. One such decision and benefit of an EPA is to arrange for long term Nursing Home Care for yourself and to be able to fund it without even consenting to it. If you want to know more about this, you can read my other blog about the Importance of Having a Power of Attorney In Place.
The most significant causes of lost capacity are people suffering from Alzheimer’s, Stroke, Acquired Brain injury or Dementia, and these people can particularly benefit and need Nursing Home care due to their complex care needs. And whenever there is the question of Nursing Home Care in Ireland, there comes the topic of the Fair Deal – Nursing Home Support Scheme. By having an Enduring Power of Attorney in place your Attorney can make this decision for you and ensure you receive the best of care while being able to utilise your finances to pay for it. Many couples have separate bank accounts and do not realise if one of them loses capacity that they cannot access their Partner’s funds if they do not have an EPA in place which can cause significant financial difficulty. It is why an EPA should be one of the most important items to sort out in your retirement planning. I always recommend that at least one of your Attorneys should be from a younger generation to you.
If you do not have a Power of Attorney in place and lose capacity, then a Care Representative Order can be applied for when the Nursing Home Loan is needed to help fund Nursing Home care costs.
What Is Fair Deal Ireland – Nursing Home Loan
As per the financial assessment of the Fair Deal Scheme, the applicant will have to pay 80% of their monthly income and 7.5% of their assets as their contribution towards the care costs of the Nursing Home under the Fair Deal. These contributions are halved where the applicant is part of a couple.
While the income contribution is funded from pensions etc. the asset contribution can be more difficult to pay where property such the home farmland & other non-cash assets are involved as the assessed contribution would normally have to be paid out of funds held in bank accounts which may not be sufficient long term to fund the required contribution to care. In such circumstance the Applicant may apply for the Nursing Home Loan or Ancillary State Support which is whereby the HSE will give a loan charged on the property assets to fund the property asset contribution which is not repayable until 12 months after the death of the Applicant. If the asset is a principal residence, then the applicant will qualify for the 3-year cap, wherein they would have to pay the yearly 7.5% on the property until the Applicant is resident in the Nursing Home for 3 years only. New legislation is due in 2021 which will extend the cap to farmland and businesses if certain criteria is met.
This loan facility is a great option for those who are cash poor but asset rich. To avail of the loan the Applicant must have capacity. If capacity has been lost and an EPA is in place and is enacted, the nominated Attorney can apply as Representative of the Applicant. If no EPA is in place a Care Representative Order will need to be applied for which once issued will enable the appointed representative to take out the Loan on the Applicants behalf.
Who Can Be A Care Representative to Apply for the Nursing Home loan?
Normally a relative or friend would apply to be the Care Representative for someone who has lost capacity and needs the Nursing Home loan to help fund their cost of care. Unlike an EPA the Care Representative Order will only allow the Representative to sign the application for the Nursing Home loan and to make decisions on the Applicant’s care.
The Process of Appointing A Care Representative
In order to become a Care Representative for a Fair Deal applicant who is physically or mentally disabled, you would have to apply to the Circuit Court, with a Notice of Motion and Grounding Affidavit. While a Solicitor is not required, I would recommend appointing one for the process unless you feel you have the skills yourself.
In addition to the application, you would have to present two medical reports obtained from two separate doctors conducting a medical checkup on the recipient of care to confirm loss of capacity.
Finally, if as a non-family member, who is neither a next of kin, the applying care representative would have to obtain an Order of Entitlement from the existing next to kin of the care recipient, if there are any.
The Care Representative Order process normally takes 6-8 weeks, but applications have taken longer recently due to Covid 19 impact on the Circuit Court.