Social Security (Long-term Residential Care) Amendment Bill

ANNE TOLLEY (National—East Coast) Link to this

When it became evident earlier that we would get to this bill on the Order Paper I went looking for the bill to speak on it tonight. I looked for the bill as reported back from the Social Services Committee, and I flicked through it and could not understand why it had not been changed or amended. Then, of course, I remembered that this bill was the one for which the Government could not get the numbers to the select committee in order for it to be amended. The senior Government whip had left the committee early, thinking that everything was OK, and Lynne Pillay was late, so the Government did not have the numbers to pass the amendments that had been agreed to at the select committee. The bill before us is the original bill, without the National Party’s minority report.

We are opposing this bill and in a way that is unfortunate, because there is much in this bill that we do support. In particular, in Part 1, we support eligibility for the disability allowance so that people in the community who receive the residential support subsidy will still be eligible for a disability allowance for the things that the residential support subsidy does not cover, like some medical costs, medicines, and related services. We also support the change to backdate the residential care subsidy from 28 days to 90 days to cover the time that it takes for people to have their financial assessment undertaken.

However, that is where our support comes to an end. For us the most important part of this bill is the maximum cap, and we have to oppose that. A number of submitters told the select committee that the Government’s imposition of the maximum cap is removing choice for people. They said that whether or not they pay for the services themselves or the State subsidises them, they have no choice, because the services must be provided at a certain cost. The providers came to the select committee and said the maximum cap obliterates any options for those who want to provide residential care to make any choices about where they site those facilities. For instance, if they wanted to build a premium facility on Oriental Parade, they could not do so, because the cost of the land would be too great and the maximum cap would reduce their ability to get any sort of return on their investment.

So the effect of the maximum cap reduces choice for people who want to go into, or have to go into, long-term residential care. But, more important, again this Government is reducing everything down to the lowest common denominator, so that all these facilities can be built only in average or less than average geographical locations in cities and towns in order to maintain any sort of return on investment based on what the Government will pay for basic care.

Some members on the select committee said the providers could charge a bit extra for this and that, but when we read the fine print we see they are not able to charge extra for the basic services. If they add on services for things like an en suite bathroom, Sky TV, or newspapers, and other extras, they are able to charge. But the basic fee that will be paid by the Government under this bill will be the same at a similar cost, whether or not the people are paying for it themselves. That is not right. People should have the ability to choose a premium facility. If they have worked hard and saved for their retirement and want a bit of extra, they should be entitled to purchase that, rather than have nanny State say: “No, this is the only standard you’re allowed. We control that, and you’ll have to do what we want, regardless of your ability to pay.” National does not think that is right, and that forms one of the major reasons why we oppose the bill.

I want to mention the Supplementary Order Paper put forward by my colleague Dr Paul Hutchison. He will be bitterly disappointed that he is not here tonight to speak to his amendment. Currently, people can have up to $150,000 worth of assets and be eligible for a subsidy to receive residential care in a facility of their choice. The subsidy pays for accommodation and care in a single room. However, district health boards currently refuse to pay elderly people their subsidy if a person chooses to use his or her asset to purchase an apartment within a rest home. The district health boards refuse to pay the subsidy, despite that person satisfying all financial eligibility criteria. This policy can lead to bizarre situations for elderly couples, where one partner has to move out of their apartment into a single room next door in order to receive the subsidy that the person is legally entitled to.

That does not make sense for a couple who may well have been together for 50 or 60 years. The effect of the bill, without Dr Hutchison’s amendment, would be to separate that couple in order to satisfy some bureaucratic machinations. That is inhuman. This amendment would change that and allow that couple to remain together. The Supplementary Order Paper is worthy of support. It is humane and it recognises that just because people may well be incapable of looking after themselves, or looking after their partner, that does not destroy the partnership they may have enjoyed for many, many years. So I ask the Committee to support Dr Hutchison’s Supplementary Order Paper when we come to vote on it tonight.

METIRIA TUREI (Green) Link to this

I would like to speak to Supplementary Order Paper 74 in the name of my colleague Sue Bradford, who, like National, wants to make some changes to this bill. The issue is around the question of district health boards whose contracting practices mean that if there is another arrangement in place then the partner of a person in long-term residential care would not be able to stay in the hospital part, because he or she would also have a contract to occupy the premises.

I would like to reiterate some of the concerns that my colleague Sue Bradford talked about during the second reading of this bill. She said it was a real concern that people will be in this situation and that we consider it unacceptable, when one partner of a couple becomes ill to the point that he or she needs full-care services and would otherwise be eligible under the income and asset-testing regime, for that person not to be able to stay with his or her partner in a licensed occupied unit because he or she is forced to move to another part of a residential complex. The inflexibility of the district health board arrangements, and in some cases the provider’s arrangements, have caused real problems for these families and these people. She was particularly concerned, too, to note that the district health boards’ standard age-related residential care services agreement actually states in clause 14 that one must not be a party to any other arrangement—for example, a licence to occupy, or a similar arrangement—that results in one effectively receiving payment to a subsidised resident, and it goes on. There is a Government aged-persons strategy in place, which sets out a priority and concern for keeping elderly people together in their own home wherever possible, and the way these arrangements are set up directly contravenes that strategy.

We do not want to see providers being able to engage in double-dipping, but that is no reason why someone who would otherwise be eligible for a residential care subsidy and who happens to live in an appropriate-level apartment or unit as part of a whole complex should not be able to receive that without having to move away from his or her partner. We are aware that the Government intends to do something about this. The Minister has agreed that he will work with district health boards and providers to sort out these arrangements, but we are concerned that the law should reflect that requirement. We urge the Committee to support the Supplementary Order Paper that will make those changes. I know that National is proposing Supplementary Order Paper 63 in the name of Dr Paul Hutchison, which is very similar, but we have some concerns about it. We think that ours is clearer and sets out the specifics around the contracts in a more coherent and cohesive way. We will therefore not be supporting the National Party amendment, even though it goes to the same issue. Rather, we urge National to support our amendment, because it is clearer, more specific, and more explicit about the problems this issue raises.

It is generally a good bill. The Green Party is generally in support of its provisions, but on this matter there is a hole that people are falling through right now and if we can find a way of fixing that right now, then we should do that rather than wait until later. That said, work is being done, and we look forward to seeing it come to fruition if our Supplementary Order Paper does not pass tonight.

SANDRA GOUDIE (National—Coromandel) Link to this

I would like to make a contribution to the debate on this part, because I think it is extraordinary that we would want to split up elderly couples who have been together for years and years. I know that my own parents would find it absolutely devastating if that were to happen to them. Every member in this Chamber should take a moment to reflect on and consider the situation of their own parents who may be living in accommodation of their choice, such as an apartment or an ordinary little house, in a retirement village.

Those are lovely situations, and they provide a form of security, safety, and peace of mind for the older people who live in them. I know that that is the sort of place my parents will be looking to retire to in the future, when they can no longer look after the property they live in now. When they cannot do the lawns or the garden and when they become less able to move around as easily as they currently do, they may then take an apartment in a residential care facility or retirement village. But if they are then required to split up because one has to go into hospital care, and the other one is told that, no, he or she cannot stay in the apartment the couple had together, then where does he or she go to? That partner does not get the same support as the one requiring hospital care.

I think we should be supporting Supplementary Order Paper 63 in the name of Dr Paul Hutchison, to ensure that we do not split up elderly couples who have been together for many, many years. It is a gross breach of their human rights to do that. Dr Paul Hutchison has proposed a very good Supplementary Order Paper, the explanatory note of which states: “Currently, someone can have up to $150,000 worth of assets and be eligible for a subsidy to receive residential care in a facility of their choice. The subsidy pays for accommodation and care in a single room. However, DHBs currently refuse to pay an elderly person their subsidy if that person chooses to use their asset to purchase an apartment within a rest home.” We support choice, and I think we should be supporting choice. The explanatory note goes on to state that in that instance: “The DHB refuses to pay the subsidy despite that person satisfying all financial eligibility criteria. This policy can lead to bizarre situations for elderly couples, where one partner has to move out of their apartment, into a single room next door in order to receive the subsidy they are legally entitled to.” Is that not just a bit bizarre? Is it not bizarre that those people have to move out of their apartment and move next door to their partner, just so that they can be entitled to receive the subsidy? How stupid is that?

That reminds me of residential villages, retirement villages, and apartment situations that cannot even provide home-care services. I think that is stupid as well, because sometimes those services are far more effective than what one might otherwise be able to get. I think the ability to contract for the provision of home-care services within a retirement village should also be considered. I know that is a little outside the parameters of what we are discussing here, but we really need to think about what we are doing to provide services for our older citizens, knowing full well, of course, that those situations are likely to increase as our population ages.

So what does Dr Paul Hutchison’s Supplementary Order Paper do? It proposes a new clause 8A, “Funder’s liability in respect of persons whose assets are equal to or below applicable asset threshold”. It states: “Section 141 is amended by adding the following subsection: ‘(5) The funder’s liability arising under subsection (2) is not affected by the fact that a person to whom this section applies occupies or will occupy a dwelling or room within a rest home or hospital (as those terms are defined in the Retirement Villages Act 2003) under an occupation right agreement (as also defined in that Act).’ ”

We know that the other issue to do with retirement villages relates to rates rebates, and that many of the older folk who are paying a proportion of the rates are not necessarily able to claim a rates rebate. However, I wonder whether, if they send to the council an account that clearly shows the proportion of the rates paid, there is a fair chance that some action may be taken to their benefit. What does Sue Bradford say in regard to that? The Greens are now saying that although they sympathise with National—that what National is saying is correct—they do not support Dr Paul Hutchison’s Supplementary Order Paper, because they have one of their own and they think it is better than his. Well, is it?

Hon PETE HODGSON (Minister of Health) Link to this

I could not turn down the opportunity to take a call. I will explain to the Committee why the Government will be voting against the Supplementary Order Paper in the name of Dr Paul Hutchison, but before I do, let me respond to an earlier comment made by Anne Tolley.

She said that her party was opposed to capping on the grounds that it made it more difficult for a rest home to be built in a well-to-do area, or alongside the seashore, or wherever it might be. I say to the member that there is plenty of choice here. If the member wishes to leave the Chamber, set up a rest home, and have private residents in her rest home, she can charge whatever she likes—the Crown has no interest in what she charges. If, however, she decides to put out her hand for a taxpayer subsidy, she is required to provide a certain level of service for that subsidy. If, in addition to that, she wants a private payer to receive the same service, she must not charge that private payer any more than what we pay her in the taxpayer subsidy. The reason for that is that if two people are living in the same rest home—[Interruption]—I did not mutter a word while that member was making her contribution, if that is what one can call it—one of whom is funded by the taxpayer and one of whom is self-funded, and both are getting the same service, somehow or other it seems reasonable that both should pay the same amount. That is the fee cap. Of course, one can buy on top of that; it is a free world.

In respect of Dr Paul Hutchison, we have had some talk about a couple who have been living together for 60 years, and have lived for the last 5 years, say, in an apartment in a retirement village. The acuity of one of them reaches a stage whereby he or she needs to move to rest home care. People are saying that the couple is being split unreasonably and unnecessarily, and that Dr Paul Hutchison has a fix. Well, let us look at what Dr Paul Hutchison’s fix does. A rest home provides hotel services and additional services. Indeed, an apartment is a hotel service, if you will, and one can purchase a series of services on top of that. What Dr Paul Hutchison’s amendment does—let us be generous and say it does it unwittingly—is allow the owner of the retirement village to double-dip, once from the married couple and once from the taxpayer. Is that a good idea? I do not think it is. So we will be voting that Supplementary Order Paper down.

Alternatively, Sue Bradford has come up with a Supplementary Order Paper that acknowledges that double-dipping is occurring, acknowledges that double-dipping is a bad idea, and seeks, with some carefully worded language, to try to address that. I say in sadness that I have had lots of legal advice on the Green Party’s remit, and we were hoping to support that Supplementary Order Paper, but my advice is that it does not get us there. I will say, however, that district health boards want to get there, anyway. They are very happy to say to people who own retirement villages that if they can put a split between the hotel services and the other services provided in their rest homes, then the district health boards will pay for the other services. They will do that.

That actually leads to another point. In considering the case of a person who has moved 100 metres from an apartment to a rest home—we are trying to avoid that, and we seem to think that is a good idea—can we please spare a thought for a couple who have been together for 60 years and who live 100 metres in another direction, in an ordinary suburban street outside that retirement village. When we start thinking that way, we start to realise that the future—[Interruption] The member’s colleague put her finger on it: the future lies in quality home-based support services, so that those people, even though they are eligible for rest home care, can choose to live at home because they will be more comprehensively supported there than they are at the moment. This is called restorative home-based care. It has been piloted in this country. We have the results of the pilot and it appears to be working.

In summary, Labour will be voting against Dr Paul Hutchison’s Supplementary Order Paper because it is dumb. We will be voting against the Green Party’s Supplementary Order Paper more in sadness, because it does not quite get us there. I say to the Green Party and to the Committee that I am very happy to take it upon my shoulders to work with the district health boards to progress this issue, anyway, and that we need also to think about people who are not in apartments in retirement villages but live 100 metres on the other side of a retirement village. Once one starts thinking that way, then one realises that restorative home-based care is the way to go.