Health of Older People in New Zealand

Changes to Income and Asset Testing Legislation

Social Security (Long-term Residential Care) Amendment Act 2004

The Social Security (Long-term Residential Care) Amendment Act 2004 came into effect on 1 July 2005. It ensured that older people can retain more of their assets while still qualifying for a Government subsidy to help meet the costs of care in a rest home or continuing care hospital.

Questions and Answers on Residential Care and Income and Asset Testing where developed to provide information on the significant changes to income and asset testing for older people requiring long-term residential care indefinitely as well as general information about entering long-term residential care.

Questions and Answers on Residential Care and Income and Asset Testing

Schedule 27 Means assessment under Part 4 Social Security (Long-term Residential Care) Amendment Act 2004 :Applicable Asset Thresholds

Social Security (Long-term Residential Care) Amendment Act 2006

The Social Security (Long-term Residential Care) Amendment Act 2006 came into effect on 22 November 2006.

The Act clarified existing policy around the maximum contribution, made some technical amendments and changes to:

the way overseas private pensions and annuities are treated;
backdating of financial eligibility for the Residential Care Subsidy; and
eligibility for the Disability Allowance.

The changes made by the Act are designed to ensure that all older people assessed as requiring long-term residential care are treated fairly

The main changes in the Social Security (Long-term Residential Care) Amendment Act 2--6 are as follows:

Private pensions
All overseas private pensions and annuities will now be treated the same as New Zealand private pensions and annuities, when older people are being financially means assessed for eligibility for the Residential Care Subsidy.

Residential Care Subsidy
Those who are eligible for a Residential Care Subsidy may have their eligibility backdated up to a maximum of 90 days (rather than 28 days), before the date their means assessment application was received (if their assets fell below the asset level before the date of means assessment).

Disability Allowance
People receiving disability-related care through the Disability Support Subsidy can receive the Disability Allowance on the same basis as others in the community; residents in long-term residential care are unable to receive Disability Allowance while living in long-term residential care.

The government promotes a legislative and fiscal environment that encourages aged-residential care services that enhance the lives of older people. This includes fair treatment if an older person is assessed as needing long-term residential care indefinitely.

The clarification of the maximum contribution in this Act means that all older people in an aged residential care facility that has a contract with a district health board for Government funding, will pay the same price in that region for the same basic package of services set out in the contract, (contracted care services).

These are positive changes that a fairer policy for residents in long-term residential care.

Links to the Acts

Page last updated: 20 July 2007