The provision of support to older people to remain in the community is likely to be the central principle of policy for the future, writes Martin Wall
The Government already has over €11 billion invested in a special fund to meet the projected costs of providing pensions in the future.
However a new inter-departmental group report recommends that it should also consider additional sources of funding, beyond taxation, to pay for the cost of providing care for older people in the years ahead.
The report sets out startling demographic and cost projections which governments in the future will have to deal with over the next 40 years or so.
There are currently around 463,000 people aged over 65 in the country.
However the report maintains this figure will more than double to 1.1 million by 2036. Over this period the number of people aged over 85 will triple to over 155,000.
It also suggests that by 2056 the old- age dependency ratio will reach 59 per cent.
The report says the provision of services to meet the long-term care needs of older people will have "substantial financial costs in the years ahead".
At present around €900 million is spent each year in total, including both public and private sectors, on residential care for older people. This accounts for 1.8 per cent of GNP. However the report estimates that by 2051 this bill will have risen to anything up to €9 billion or 2.4 per cent of GNP per year.
It proposes that to meet this cost there will have to be a substantial element of co-payment involved. In other words, either the person receiving the residential care or their family will have to continue footing a large part of the bill.
The group also proposes that the Government should seek to reduce the requirement for residential care among older people by introducing measures which would allow them to remain, as far as possible, in their own community.
The provision of support to older people to remain in the community should be the central principle of future policy.
It says it is generally accepted that older people and their families have a preference for home care and it recommends an increased provision of home-care packages.
The group suggests that increased numbers of home-care packages should be provided on an initial basis in 2006 and 2007 and that a full evaluation should then take place. However it warns that informal care by family members and others "will remain a cornerstone of long-term care policy". Home-support packages will complement rather than substitute for such informal family-based care, it adds.
At present 4.4 per cent of the over-65 population is in residential care. However the group argues that the Government should set a target of reducing this figure to 4 per cent. It believes this is achievable in the medium term "if the correct policy mix is implemented, particularly in regard to significant community-based supports including respite care".
However it warns that "even a 4 per cent residential occupancy rate has very significant cost implications".
It says the full extent of the costs facing the Exchequer will depend on the nature and extent of co-payments required to be met by the individual for residential and home support as well as decisions taken following the proposed evaluation of the home-care packages in 2007 in relation to their wider availability.
The group says that at present, residential care is provided by a combination of private and public facilities, with a range of factors determining the level of financial contribution required by the older person and/or their family.
It proposes that as part of a new approach a national standardised needs assessment should be introduced to determine whether a person has a sufficiently high level of dependency to require residential care. Once access/need for service has been established, the costs involved should be shared by the State and the individual, it says.
The level of each individual's co-payment should be based on ability to pay. This would be determined by a financial assessment, based on national standards. This would take account of assets owned by the individual including housing.
"The co-payment assessment should be indifferent as to whether that care is provided in a public or private facility," the report states.
The group proposes that an equity release-type facility should be available to allow older people to meet the costs of their co-payment for care from the value of their house or asset which they could retain the use of during their lifetime.
The group believes that issues such as whether the individual would be required to use the full value of their house or asset in contributing to their long-term care and whether the State should provide a minimum level of support to all regardless of means were issues which required further consideration.
It suggests that in determining the level of co-payment required from the individual one option for the State could be to extend the principle which currently underpins the approach taken in relation to patients in public long-term care beds.
This involves the individual involved paying up to 80 per cent of their non-contributory old age pension.
"Under this approach, the care recipient might be required to contribute 80 per cent of their assessed income towards the cost of care. However a range of other approaches and levels of contribution will also need to be considered," the report adds.