Launch:A special fund similar to the pension reserve fund may have to be established in the future to fund long-term care for the State's increasing elderly population, Minister for Health Mary Harney said yesterday.
Announcing an overhaul of how long-term care is to be funded from 2008, she said: "It may well be that we will have to establish in Ireland for 30 or 40 years hence something like the pension reserve fund . . . an actual financing mechanism to meet the care as the population ages quite rapidly.
"By 2036 for example, the number of older people here will have doubled as a proportion of the population," she said.
The scheme announced yesterday will make nursing-home care more accessible and affordable for all, she pledged.
The system will result in the means-testing of all those going into nursing homes, whether the homes are public or private. They will be medically assessed to determine if they need nursing-home care at all.
Ms Harney said current supports for people in long-term care are very discriminatory. "If somebody is in a public nursing home they pay no more than 80 per cent of the non contributory old age pension. The State pays effectively 90 per cent of the cost of their care.
"If however somebody is in a private nursing-home facility, some get subvention, others get nothing and the State on average pays about 25 per cent to 30 per cent of the cost of their care," she said.
The nursing-home subvention scheme, she added, was inequitable, unfair and was causing enormous hardship. "There are many families in this State that have remortgaged their homes to pay for care, there are children that have remortgaged homes. One bank alone told me that 2,500 older people have availed of an equity release scheme to fund long-term care. There are families paying €35,000 to €40,000 to pay for their parents' care."
The new plan would address those issues and would ensure there was no responsibility on children to fund their parents' care, she said.
It would also reduce the worries older people had about how they would fund their care by having payment of the cost of their care deferred until after their death.
Everybody would be asked to contribute towards their long-term nursing home care according to their means and no older person in future would have to pay more than 80 per cent of their disposable income for their care, she stressed.
"Everybody will receive financial support from the State towards that care - except where they clearly don't need such help," she added.
Ms Harney also stressed that nobody currently resident in either a private or a public nursing home was going to be worse off as a result of the new policy. But from 2008 anybody going into a public home could be paying more.
The number of public nursing homes needed to be increased and the HSE was looking at colocating them with hospitals, where geriatricians could provide cover for them.