The Residential Care Subsidy (“subsidy”) is paid by the Ministry of Health to assist with the costs of long-term residential care (“long-term care”). It is paid directly to the rest home or hospital where the person lives.
There is a three-step process to determine whether a person is eligible for the subsidy.
1) Needs Assessment
This assessment determines whether a person needs long-term care. An application can be made to a Needs Assessment Service Co-ordination service (“NASC”) directly, through Te Whatu Ora, or by asking the person’s doctor, or other health provider.
The NASC will arrange the assessment and provide the results to the person assessed and the provider who is providing them care.
If the person is aged 65 or over and the assessment shows that the person needs care, a subsidy application form will be provided. The completed form must be provided to Work and Income (WINZ). WINZ will then carry out a means assessment. This involves assessing the person’s assets and income.
If the person is under 65 and has a partner, no further steps need to be taken.
2) Asset Assessment
If the person is between 50 and 64 years old and has no partner nor dependent children, they will automatically meet the asset test.
If the person is 65 or older, the total of their assets and those of their partner must be $284,636 or less, including the family home and personal vehicle.
If the person has a partner who is not in long-term care, they can choose whether the total value of their combined assets includes the value of the family home and vehicle. If the person chooses not to include these, then the total assets must be $155,873 or less.
Any assets that have been gifted by the person and their partner above the limit will be included as assets. The limits are:
- $8,000 per year for 5 years preceding application; and
- $27,000 per year for gifts made more than five years before the application.
If the person is not eligible for the subsidy as a result of the means assessment, they may be able to get a Residential Care Loan.
3) Income Assessment
The result of this assessment determines how much the person must contribute to their long-term care. The subsidy will be the difference between this amount and the cost for the long-term care.
Each region has a maximum contribution cost that the person can pay towards their care if they are assessed as needing care and receive contracted care services, regardless of the results of the means assessment. The maximum contribution ranges between $1,355.76 and $1,464.26 per week.
For assistance with the subsidy, please contact our Seniors Law Team.
