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Nursing home charges: What is the controversy about and how has the Government responded?

A 2011 memo stated that the liability from these incorrect charges could amount to €12 billion.

THE ATTORNEY GENERAL has been asked by the government to provide advice about the State’s ongoing “legal strategy” to attempt to limit payouts to nursing home residents and their families over historic, unlawful charges.

It comes after the Irish Mail on Sunday reported a whistleblower’s claims of a secret government strategy to limit payouts to people on medical cards – who could have been entitled to nursing home care provided by the State – by settling cases out of court.

The government has claimed that the issue is being “misrepresented” in the past two days. Let’s break down what we know so far. 

What is contained in the whistleblower’s claims?

A report in the Irish Mail on Sunday contained claims that successive governments have allegedly pursued a secret strategy aimed at limiting refunds from the State to individuals who were incorrectly charged for public nursing home care.

It is claimed that this involved denying compensation to “anyone who did not have the resources to fight legal cases”, while the remainder of the cases “were all quietly settled by the State”.

This is based on a protected disclosure by Department of Health whistleblower Shane Corr and further alleges that since 2011, multiple governments have sought to hide the State’s liability for these charges to prevent a possible €12 billion in payouts to those affected. 

What’s the background to this?

The 1970 Health Act had stated that in-patient services should be free for those with full eligibility.

Until the mid-2000s, medical card holders were entitled to free nursing home care from the State.

Since 2005, medical card holders are liable for a charge after 30 days of in-patient services.

However, many medical card holders during the period from 1976 to 2005 had to pay for care when it should have been free.

In a statement to the PA news agency, the Department of Health said: “Issues relating to the legal basis for charges paid by nursing home residents were highlighted in 2005 following a Supreme Court judgment.”

In 2004, then president Mary McAleese referred to the Supreme Court a Health Amendment Bill which sought provide a retrospective legal basis for the charging of medical card holders over a period of almost thirty years.

The Bill also would have prevented people from suing in order to get their money back.

In February 2005, the Supreme Court held that the Bill was unconstitutional and sought to make lawful the unlawful practice of charging medical card holders for public nursing home care.

It also found that patients who had been unlawfully charged for these services had the right to sue in order to recover damages.

The Department of Health spokesperson added: “The Health Repayment Scheme was put in place by the Government of the day in 2006 to repay eligible long-stay residents in public facilities.”

“Since 2009, the Nursing Homes Support Scheme has provided a statutory basis for individuals to make contributions towards their public or private nursing home costs.”

The Health Repayment scheme was enacted in June 2006 to “provide a legal basis for the repayment of long-stay charges which had been imposed on persons with full eligibility since 1976”.

These were people who had a medical card or were entitled to one.

However, speaking to RTE’s News at One, Age Action’s Head of Advocacy Celine Clark said this scheme had “very narrow terms of references” and was limited to people who “were still living or who had died on or after December 1988”.

She added that patients “who had to fund their own care because of a lack of a public space were excluded”.

How did this rumble on?

The 2011 memo provided by Corr stated that the liability from these incorrect charges could amount to €12 billion.

Dated 13 July, 2011, this memo is reported to have been marked “secret” after first being prepared by the Department of Health.

It was allegedly shared with a select group of politicians and read that “‘Confidentiality has been a central element of the legal strategy”.

Up to 250,000 patients with medical cards were said to have been incorrectly charged for public nursing homes since 1976, with a “a potential exposure of €5 billion”.  

These incorrect charges are also said to have affected residents who had to pay for private nursing homes because no public nursing home places were available, with “a potential exposure of approximately €7 billion”, according to 2011 files. 

The potential exposure from these two groups gives the overall potential liability to the State of €12 billion.

But in 2010, the Office of the Ombudsman Emily O’Reilly published an investigation based on more than 1,000 complaints made since 1985.

The complaints were made on behalf of older people who were unable to get long-term nursing home care from the HSE, and as a result had to use private nursing homes.

O’Reilly’s report, entitled ‘Who Cares?’, said the Department of Health “persisted with an illegal charging regime because of, amongst other things, the need to maintain an important source of funding”.

She added that the complaints she was encountering when she began working on the report in 2009 “were no different” to those received “as far back as 1985”.

The Ombudsman’s report stated that “health boards had, for decades, been charging medical-card holders for in-patient services despite having been warned by several different legal advisers that the practice was illegal”.

She said that after four decades marked by “confusion, misinformation and inconsistency” the State was facing “several hundred legal actions” from families seeking compensation for the costs incurred in having to use private nursing homes.

What happened then?

A Government spokesperson last night confirmed that the “legal strategy pre-dated July 2011 and was pursued by successive governments”.

The Irish Mail on Sunday reported that the 2011 confidential memo was restricted to just several Ministers and that it was allegedly re-affirmed by successive governments.

It is also alleged that this “legal strategy” sought to prolong cases and ensure that settlements were not publicly reported.

The Irish Mail on Sunday Mail article stated that agreement has to be reached with the Office of the Controller and Auditor General (C&AG) to ensure settlements were not publicly reported by the spending watchdog.

A statement provided to The Journal from the Office of the C&AG, said:

“The article has quoted from a document which we have not seen and therefore we are not aware of the context of the selected quote. It is important to note that the C&AG is independent of government in the exercise of his functions.”

What has been the response from government?

Speaking in the Dáil this afternoon, Taoiseach Leo Varadkar said: “All ministers from 2005 onwards at all times acted in good faith, in the public interest, in accordance with official advice and in accordance with legal advice from the Attorney General and that’s exactly how they should act.”

The government spokesperson who issued a statement last night also added that the legal strategy “has been misrepresented”.

“The strategy was to defend the cases relating to private nursing homes on several grounds, in particular that medical card holders did not have an unqualified entitlement to free private nursing home care,” said the spokesperson.

“A limited number of individual cases were settled where there were complicating factors. No case ever proceeded to a hearing.

“In the case of public nursing homes, a scheme was put in place and €480 million was paid to former residents or their families.”

A spokesperson for the Taoiseach told reporters that this afternoon the Department of Health confirmed that the document referred to in the Irish Daily Mail this morning, which the newspaper said indicated that Varadkar had “signed off” on the strategy, actually referred to a previous minister. 

Having sought clarification from the department last night, the spokesperson said that this afternoon they got confirmation that the document (which was dated 5 May 2016) “specifically related to a previous minister, it did not relate to Minister Varadkar”.

The message sent from the Department of Health to the Department of the Taoiseach, regarding the document on nursing home charges prepared by the Older Persons Service Oversight and Planning Unit in Health, and sent to an Assistant Secretary in Health on 5 May 2016 reads:

“It is the clear understanding of the Unit that this does not refer to Minister Varadkar, as was, but refers to a previous Minister, as this decision in relation to the range of settlements was apparently made well before his time.”

When reporters asked what minister the document refers, Varadkar’s spokesperson said:

We don’t know, the Department of Health hasn’t told us, but it wasn’t Minister Varadkar.

He went on to state that the response from the department said the document made reference to “a former minister” but didn’t specify which minister. 

The Journal has asked the Department of Health for clarification. 

The spokesperson for the Taoiseach said “successful ministers have stood over the strategy”, adding that the policy has been consistent since Mary Harney was health minister. 

The Attorney General is examining the issue and is due to submit a report to Cabinet next week on the matter. 

Speaking to Newstalk yesterday, Taoiseach Leo Varadkar said that he didn’t receive the 2011 memo, and nor did anyone who is in the current government.

He added that the figures used in the Irish Mail on Sunday article “are not in any way still valid” and appear to relate to “nursing home charges prior to the Fair Deal”.

The Fair Deal Scheme is a financial support scheme for people who enter into long-term nursing home care.

It was designed to help older people pay the costs of nursing home care regardless of their financial situation and takes into account income and assets.

The Taoiseach also told Newstalk that his “initial understanding” is that the issue relates to people “who pay for private nursing homes”.

Varadkar added: “They argue that because they had a medical card, they were entitled to a full refund of the cost, regardless of the cost or regardless of which nursing home they chose; the state has never conceded that.”

Varadkar acknowledged that “there have been some cases that have been settled” but added: “It will be the case from time to time that government departments will settle some cases.

“But they’re not all settled and there was never a test case that went to trial.”

He also said that the “real picture is a lot more complex” and that he was “never party to devising or agreeing a legal strategy in relation to nursing home charges”.

However, speaking on RTÉ’s Morning Ireland today, Róisín Shortall, co-leader of the Social Democrats, said: “I noticed that the Taoiseach said yesterday that he wasn’t party to devising or agreeing the legal strategy.

“And I don’t think that was the allegation that was made.

“Now, that point hasn’t been addressed by the Taoiseach, whether he was briefed on it or not. So I think it’s important that we find out what was that briefing.”

Shortall called for the documents related to the legal strategy to be released, as well as details on who had been briefed on it.

What has been the response from others in the opposition?

Sinn Féin’s health spokesperson David Cullinane called on the Taoiseach and Health Minister Stephen Donnelly to issue statements on their knowledge of the strategy.

He too called on the government to “release all relevant documents and memos to provide full transparency”.

Cullinane has also written to the Oireachtas Health Committee requesting copies of all memos and documents referenced in the report.

Elsewhere, the Regional Independent TDs group yesterday called on the Oireachtas Business Committee to convene to find time in the Dáil schedule this week to discuss the controversy.

However, a Dáil debate on the nursing home charges controversy is delayed by one week.

It’s understood that the committee met yesterday afternoon and Government Chief Whip Hildegarde Naughton said that it was too short notice.

With reporting by Christina Finn

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