New scheme to help nursing homes with soaring energy costs

Nursing homes will be able to claim up to €31,500 each under a new Government scheme aimed at reducing the financial pressure from increases in electricity and gas bills.

Minister for Mental Health and Older People Mary Butler and Minister for Health Stephen Donnelly will on Monday announce the launch of the Temporary Inflation Payment Scheme (Tips), a support scheme to help private and voluntary nursing homes with energy cost increases in the second half of this year.

At least 16 smaller nursing homes, each averaging less than 30 beds, have announced their closure this year. mainly due to increasing energy costs and higher regulatory demands.

The Government is setting aside €10 million for care facilities for older people that have existing agreements with the State’s National Treatment Purchase Fund under the Fair Deal subsidy scheme to help them manage increased energy costs between July and December of this year.

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Each nursing home can apply for up to €31,500 in vouched increased energy costs for the six-month period. Nursing homes can claim up to 75 per cent of their year-on-year cost increases, capped at a maximum of €5,250 per month per nursing home, backdated to July 1st of this year.

If monthly energy costs at a small nursing home have doubled to €7,000, the home can claim €2,625 a month, or 75 per cent of their €3,500 monthly increase on last year’s bills.

A large nursing home which has seen its monthly bills increase by €7,700 to €21,700 will only be able to claim the maximum €5,250 as 75 per cent of its cost increase is higher than the monthly cap.

The scheme will open for applications from November 11th at the latest, and nursing homes will be required to provide evidence of the energy cost increases such as bills or invoices.

The nursing home sector has for several months been calling on the Government to step in with financial supports to help care facilities through the cost-of-living crisis.

Ms Butler said she and the Government were “keenly aware of the financial challenges” faced by nursing homes on cost increases, and have worked to bring forward “appropriate responses”. She said the Government was “particularly conscious” of how increased energy costs “can often disproportionately affect smaller, family-run and voluntary nursing homes that do not have the same access to economies of scale as larger nursing homes”.

“The purpose of these additional supports is to make sure viable nursing homes do not experience difficulties in delivering services due to the rise in energy costs,” she said.

The scheme will operate in a similar way to the Temporary Assistance Payment Scheme (Taps) that was set up to help nursing homes shouldering higher costs from the Covid-19 pandemic.

Ms Butler said the Government also planned to seek “a dedicated funding stream” under the Fair Deal scheme to reflect the costs associated with higher-dependency dementia care.

The State relies heavily on the private sector for the care of the elderly. About 80 per cent of nursing home beds are provided by private operators, with voluntary, not-for-profit nursing homes accounting for about 4 per cent of the sector. There are 433 private nursing homes providing residential care to more than 17,500 people on behalf of the State.

More than 22,500 residents are supported through the Fair Deal nursing home support scheme at a cost of more than €1 billion.