Residential Care Subsidy Update

Effective 1 July 2024 the thresholds that apply to residential care subsidy (RCS) applications have been updated.

What is the Residential Care Subsidy?

If you need long-term residential care in a hospital or rest home, you may be able to get a Residential Care Subsidy. This subsidy helps with the cost of care and is paid directly to the hospital or rest home by Health New Zealand - Te Whatu Ora.

Who can get it?

You may be able to get a Residential Care Subsidy if you:

1. Are aged either:

• 65 years or older

• 50-64 years and single with no dependent children

2. Are assessed as needing long-term residential care in a hospital or rest home

3. Need this care for an indefinite length of time

4. Are receiving contracted care services.

Eligibility will also depend on the assets you and your partner have, how much income you both earn and what assets you have gifted.

Asset limits - Updated 1 July 2024

The assets limits for the 65 + demographic are now:

• $284,636 or less (previously $273,628)

• If you have a partner who's not in long-term residential care, you can choose whether the total value of your combined assets is either:

  • $155,873 or less (previously $149,845), if the value of your house and car is exempt (your house isn't counted as an asset if it is the main place where your partner or dependent child lives), or

  • $284,636 or less, if the value of your house and car is not exempt.

Allowable gifting amount - Updated 1 July 2024

If you or your partner have gifted assets, there's a certain portion that won't be included in your asset assessment. The amount depends on whether you have gifted assets within the last five years (from the date you apply for the subsidy).

The gifting limit for the five year period before a Residential Care Subsidy application is now $8,000 per year.

The gifting limit for assets that you've gifted before that five year period is up to $27,000 a year.

Income-from-assets exemptions - Updated 1 July 2024

When your income is assessed, a portion of any income you receive from your assets is exempt from your income assessment. This amount is referred to as the "income-from-assets exemption".

The income from assets limits are now:

• $1,236 a year for a single person (previously $1,188)

• $2,472 a year for a couple when both have been assessed as needing care (previously $2,376)

• $3,707 a year for a couple where one partner has been assessed as needing care (previously $3,564)

If you would like to discuss the Residential Care Subsidy or the above changes in more detail, please get in touch with your CT Advisor.

Cheers
Lincoln

Lincoln Sharp, Director

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This article contains general information only and based on information available at the date of publication. You should obtain advice for your personal circumstances.