C27/1996 BUDGET INITIATIVE: CARE PROVIDERS AND PENSIONERS ENTERING COMMUNITY BASED CARE TO HAVE THE ASSET VALUE OF THEIR FORMER HOME DISREGARDED FOR A 2 YEAR PERIOD.

DATE OF ISSUE:  28 MARCH 1996

BUDGET INITIATIVE:  CARE PROVIDERS AND PENSIONERS ENTERING COMMUNITY BASED CARE  TO HAVE THE ASSET VALUE OF THEIR FORMER  HOME DISREGARDED FOR A 2 YEAR PERIOD.

TABLE OF CONTENTS

INTRODUCTION...........................................................

BACKGROUND............................................................

CHANGES...............................................................

LEGISLATION.............................................................

DEFINITIONS.............................................................

RECORDING ON PIPS......................................................

CONTACT OFFICER........................................................

INTRODUCTION

The purpose of this Instruction is to provide details of legislative and procedural changes on the reforms to the assets test for care receivers and care providers when they leave their principal home.  Legislative changes announced in the May 1995 Budget are effective from 20 March 1996.  The Veterans' Affairs pay-day for implementation is 28 March 1996.

BACKGROUND.

2.Section 52 of the Veterans' Entitlements Act 1986 (VEA) lists the assets which can be disregarded in valuing a person's assets for the purpose of determining the rate and payability of pension.

3.Under the provisions of paragraphs 52(1)(a) and (b)VEA and of paragraphs 5L(7)(b) to (e)VEA, when a person enters a nursing home, their former home can be disregarded under the assets test for a maximum of two years.  However, because of the application of paragraph 5L(7)(a)VEA, which states:

"A residence of a person is to be taken to continue to be the person's principal home during:

(a)any period (not exceeding 12 months) during which the person is temporarily absent from the residence;"

the value of the home of a person who leaves their home temporarily  to receive community based care or to care for another person can only be disregarded as an asset for a period of up to 12 months.

CHANGES

4.In order to address the anomaly in treatment between nursing home residents and people providing or receiving community based care, the definition of principal home has been extended to include pensioners:

• in a relevant care situation; and

• those who provide community based care.

The effect of the inclusion of these definitions mean that pensioners who enter community based care will now have their home disregarded as an asset for two years in the same way as pensioners who leave their home and enter nursing homes.

LEGISLATION

5.Sub-section 5L(7) VEA dealing with a person's principal home has been amended by removing references to a nursing home in paragraph (d), replacing these with the phrase 'relevant care situation' and adding a new paragraph (f) as follows:

"(d)if:

(i)the person is in a relevant care situation; and

(ii)while paragraph (c) applies, the person's partner or non-illness separated spouse dies while in a relevant care situation; and

(iii)the person's partner or non-illness separated spouse had been in a relevant care situation for less than 2 years;

the period of 2 years beginning at the time when the person's partner or non-illness separated spouse started to be in a relevant care situation; and

(f)any period of up to 2 years while the person is absent from the residence and is personally providing community based care for another person."

DEFINITIONS

6.The following new definitions have been added to accommodate these changes:

In a relevant care situation means either in a care situation or in residential care.

A person is in a care situation if:

(i)the person is in a nursing home; or

(ii)the person is receiving community based care.

A person is in residential care if the person:

(a) is residing in premises that are:

(i)an approved nursing home for the purposes of the National Health Act 1953 or the Nursing Homes Assistance Act 1974; or

(ii)an approved home for the purpose of the Aged or Disabled Persons Care Act 1954; or

(iii)an approved hostel for the purposes of the Aged or Disabled Persons Hostels Act 1972; or

(iv)made available for the accommodation of the person by an approved organisation providing hostel care services or personal care services to the person for the purposes of Part III of the Aged or Disabled Persons Care Act 1954; and

(b)has resided, or is in the Commission's opinion is likely to reside, in the premises for at least 14 consecutive days.

7.A person is receiving community based care if, in the Commission's opinion, the person needs, and has been receiving or is likely to receive, a substantial level of care in a private residence for at least 14 consecutive days.

8.Substantial level of care has not been defined in the VEA.  To determine whether a care receiver requires and is receiving a substantial level of care, they should meet one or more of the following criteria.

• Domiciliary Nursing Care Benefit (DNCB) is being paid to a care provider in respect of the care receiver; or

• Carer Pension (from DVA or DSS) is being paid to a care provider in respect of the care receiver; or

• Care receiver is in receipt of Disability Support Pension or Invalidity Service Pension and because of their condition require assistance; or

• Care receiver is over pension age and regarded as frail; or

• Care receiver can provide medical evidence stating they left their home due to illness; or

• Care receiver can provide evidence that on their recent discharge from hospital they require assistance; or

• Care receiver has been assessed by an Aged Care Assessment Team (ACAT) and is awaiting institutional admission or has been accepted for approved respite care.

RECORDING ON PIPS

9.The exempt property is to be recorded on the HO screen in the same manner as an exempt property of a pensioner who has left their home to live in a nursing home.

CONTACT OFFICER

10.Enquiries in relation to this DI can be directed to the Project Officer, Virginia Parry-Jones by telephone on (03) 9284 6450,  fax 03 9284 6794 or E-Mail V-B-PDI2.

W R MAXWELL

A/g DIVISION HEAD

COMPENSATION