Hello again and welcome to this week’s On The Money newsletter. A lot of attention is paid to the ins and outs of funding nursing home care – through Fair Deal or otherwise. But, for most people, it remains the case that they would much prefer to live in their own homes for as long as possible. Nursing homes are rarely an active choice of people with alternatives.
As we get older, however, illness or infirmity often means that we have to accept some limits on our independence and the need for a degree of support.
Where family live close by and have the capacity, timewise, that is obviously the favoured solution but that’s not always possible. Families are often dispersed and likely to have their own work or family commitments that limit their availability.
Professional home carers, increasingly, are stepping in to fill the gaps. But how does that work and who pays for it?
The Process
There are really three ways in which people can access home care when they feel they would benefit from the support themselves or that their relatives would.
For most people, the first port of call will be the local public health nurse. GPs will routinely direct people there where concerns about people’s ability to continue living independently arise.
Formerly known as the Home Help Service and Home Care Package Scheme, it is now called the HSE Home Support Service. It is generally available to people over the age of 65 who either need support to continue living at home or to return home after a hospital stay.
Exceptions are made for people under the age of 65 with particular needs – for instance a disability or something like early onset dementia.
Under the scheme, carers will provide services like helping people to get into or out of bed, getting dressed and personal care such as washing, and shaving, as well as essential domestic services.
Anyone looking to secure such support needs to fill out an application form which you can find on the HSE website, or here and return it to your local HSE home support office. There are 41 of these around the State and they are listed on the form.
Whoever fills out the form, it is important that the person who will be receiving the care signs it – mainly to ensure that they consent to the process.
Your local support office will then carry out a care needs assessment, after which a decision is made on the care that can be provided – either by HSE staff or more often, especially in Dublin, by agencies approved by and working for the HSE. That decision comes fairly quickly – a couple of weeks generally.
The uncomfortable truth is that such decisions are not purely based on care needs but also on the budget on the HSE.
The HSE’s 2025 Service Plan says it provided 23.4 million hours of home care to 58,200 people last year, ahead of forecast. It anticipates it will support 60,000 people under the scheme this year, providing 24 million hours of care.
“It’s discretionary,” advises Michael Wright, director of corporate operations at Dovida, until recently known as Home Instead. “So, if they have the budget, you’ll get the funding. You may have to wait if they don’t have the budget. Then there may, depending on where you live be a challenge around the number of workers. People are on a waiting list.”
Junior health minister Kieran O’Donnell has said that delivering a Fair Deal-style scheme giving people a legal entitlement to home care in the lifetime of the Government is his “number one priority”. However, it remains very unclear just how such a scheme would be put together.
As of the end of last year, according to Home and Community Care Ireland, which represents the sector, 5,556 older people were waiting for HSE Home Support nationally.
It is less of an issue in Dublin, ironically, but if you find yourself in that position what are the options.
Essentially, they are twofold: either you source a carer among family, friends, the local community or online, or you go privately to one of the many private home care agencies.
Dovida says it largest operator in the private home care market has about 3,800 carers on its books, providing care to 7,000 people. It says there are as many as 50 such agencies operating in Dublin.
Apart from providing hours under contract with the HSE, these agencies can provide additional paid hours to fill in any gaps in the HSE-provided care. Budget constraints means what the HSE can do will fall short of what the client or their family thinks is required.
Michael Wright says around 43 per cent of HSE provided care hours amount to visits of less than one hour, which limits the service that can be provided. Then there is care that would fall outside the parameters of the HSE scheme.
“People often want more than a 60-minute visit. That’s why they go private. They might ask, in addition to HSE hours, can you stay two or three hours to do housekeeping or messages, or simply spend time with Dad who has dementia and that gives a chance for Mum to get out of the house and have a break.
“I think privately-paid care covers the gap between what you might get in a nursing home and what the HSE is funding in home support,” he says.
How much does home care cost?
Which brings us neatly to the thorny issue of costs and how to meet them.
HSE’s Home Support Service is free, regardless of means. Whether you are on a medical care or not is irrelevant. You are assessed purely on need.
But if you need care over and above what the HSE can provide – or services that do not come within its remit, you are looking to pay privately.
Agencies like Dovida provide everything from care by the hour to overnight stays and even 24-hour care.
Wright says you can expect to pay €36.90 per hour for agency care in Dublin, falling to around €33.90 an hour in places like Galway and Cork. Rates for overnight care and 24-hour care would be different.
Going privately outside the agencies will likely be cheaper – not least because some of that hourly rate goes to support the administrative functions of the agencies which also, as private businesses, will be looking to make a profit. That means what the carer gets into their hand will be some way shy of the headline figure.
However, if you do go privately, you are effectively becoming the employer of the carer, which brings with it all sorts of bureaucracy like registering with Revenue as an employer, deducting income tax and PRSI from their pay and making the necessary returns.
Going through an agency cuts through that as the agency is the employer and the paperwork becomes their headache.
Do people operate on a “cash-in-hand” basis? Of course they do but this, too, has implications.
One of the big attractions of private care is that a chunk of the cost can be claimed back from the Revenue Commissioners.
Revenue allows relief at your marginal rate on the cost of care for yourself, a family member or relative who is “totally incapacitated due to physical or mental infirmity”.
Totally incapacitated does not mean that they are bed or chair-bound, but Dovida’s Michael Wright says precisely what it does mean is curiously ill-defined by Revenue.
“One of the biggest challenges we have with Revenue is that they don’t define what incapacities would qualify and what don’t,” he says. “But we kind of feel, if you qualify for an HSE home support service or if you would qualify for the Fair Deal, you’ll qualify for tax relief.”
What you certainly need to remember, however, is that care qualifying for tax relief does not include things like housekeeping or shopping.
To crunch the number for care that does qualify, if you were paying for two hours private care a day at €36.90, the bill would come to €516.60 a week, just under €2,240 a month or €26,863.20 a year.
If you pay tax at 40 per cent, you would get €10,745 of that back when you file a tax return, bringing the weekly cost down to around €310.
That’s not necessarily cheap depending on your free cash flow but, for comparison, you might expect to pay €7,000 a month for private nursing home care in the absence of Fair Deal.
Who gets the relief? Whoever is paying the bill, and that can be split among several people if more than one person is contributing to the cost of care as long as cost is not double-counted.
There is an upper limit on the cost of care that will be considered for relief. That is currently €75,000 which, on the figures above, equates to slightly less than six hours of private care per day.
But it is important always to remember it is not always just about money. Most people, given the choice, would prefer to see out their time in the comfort and familiarity of their own home.
That might mean they leave somewhat less behind them for family and friends in any will, but it is important that older people and their families remember that their first priority is to themselves.
You can contact us at OnTheMoney@irishtimes.com with personal finance questions you would like to see us address. If you missed last week’s newsletter, you can read it here.
