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Discrimination in funding of nursing home care laid bare by Department of Health analysis

Tuesday December 21, 2021

Requirement for Government to take immediate action to redress discrimination

21st December 2021: There is requirement for Government to take immediate action to redress discrimination applied by the State against private and voluntary nursing home residents and staff, Nursing Homes Ireland (NHI states). It follows publication of a damning report by the Department of Health that reveals HSE nursing homes receive funding per resident that is almost double that payable to private and voluntary counterparts.

A value for money review of nursing home care costs, an independent analysis commissioned by the Department of Health, was tasked with analysing the reasons for the very considerable cost differentials between HSE and private/voluntary nursing homes. Commissioned in 2018, the report presents a damning inditement regarding the extent of discrimination being applied by the State in the funding of nursing home resident care.

It brings to public attention a huge chasm in fees payable for resident care, with the average differential per resident being in fact 73% between HSE operated nursing homes and private and voluntary and not the 62% presented by the published Fair Deal fees. The analysis finds HSE nursing homes fees are an average €100 per resident, per week, above those publicly published. Despite the exorbitant differential, the report confirms no difference in dependency levels of residents within either HSE or private/voluntary nursing homes, a long-standing HSE contention for the fee differential.

It states regulator HIQA concerns that Fair Deal fees are not based on care needs of residents and despite the ethos of the scheme being it applies equally to all nursing homes, HIQA informs this is not commensurate with levels of support provided to care providers.

With regard to costs, the report finds:

  • Between the years 2015 and 2019, the average fee paid per resident in private and voluntary nursing homes increased by 10% from €903 to €992, but the increase for HSE nursing homes was double, increasing by 20.3% from €1,426 to €1,716.
  • In 2015, the fee per resident, per week, in a HSE nursing home was on average €523 more than the fee, per resident, in a private/ voluntary nursing home. By 2019, the price difference had increased to €624.
  • In 2019, HSE nursing homes, on average, incurred additional costs of €100 per resident, per week, higher than the cost of care presented by the HSE within its Fair Deal fees. This results in expenditure being 73% more, per resident, for HSE nursing homes and not the 62% that is presented by the published Fair Deal fees.
  • An additional €25 million was allocated to HSE nursing homes in 2019, exclusive of Fair Deal.
  • Mortgage repayments, commercial rates, insurance and capital costs are encompassed within fees payable under Fair Deal to private and voluntary nursing homes but are not pertinent to HSE nursing homes Fair Deal fees.


Tadhg Daly, NHI CEO comments: “This report presents a damning inditement that highlights the discrimination in how the State funds nursing home resident care. It reveals an exorbitant differential in fees payable and the considerable higher fees for HSE nursing homes that are publicly published are in fact below the reality of what the actual cost of care is. The 73% differential highlights the fees payable per resident in HSE nursing homes are almost double that for residents in private and voluntary. This represents coarse discrimination that requires Government intervention. The funding disparity must be addressed through more equitable resourcing of nursing home care.

“The HSE has consistently pronounced to the public that it provides care for people with higher dependency care needs and this is a justification for an effective doubling up of its fees. This independent analysis finds no particular differential. It also assesses the regulatory requirement to ensure skill mix of staff is appropriate to residents care needs and finds levels of compliance are effectively same for both. The justifications offered by the HSE do not stack up, the report presents.

“Its recommendations are welcome but, as per other reports, will there be an impetus to act upon them or will years be allowed pass without any change coming into effect. We need a commitment to deliver on these recommendations in the interests of current and future residents. Implementation of an assessment tool to assess resident dependency levels has been on the agenda for many years but never come into effect within the nursing home sector. We have in effect for private and voluntary nursing homes a 12-year-old Fair Deal scheme that determines fees based on historic pricing arrangements that pre-date the scheme and the county in which the nursing home is located, as opposed to resident care needs and the reality of staffing costs.”

A value for money review of nursing home care costs follows a report by the Comptroller and Auditor General, published August 2020, which found the HSE had publicly published incorrect Fair Deal fees for its nursing homes in 2018 which not been corrected on its website. It also found no evidence of a model being applied by the NTPF to inform how it encompassed dependency needs of residents when negotiating Fair Deal fees. Separate, the Department of Health’s 2015 Review of the Fair Deal scheme recommended within 18 months Fair Deal’s pricing mechanism be reviewed to ensure adequate residential capacity for residents with higher level or more complex care needs, to achieve value for money and economy, and to increase the pricing mechanism. These issues remain unaddressed.

NHI CEO Tadhg Daly is available for further interview. Media interviews will be facilitated by Michael McGlynn, NHI Communications & Research Executive, who can be contacted at 087 9082970.

Note for Editor

Download: A value for money review of nursing home care costs