THE MINISTER FOR Health has announced increased charges of €12 million for long-stay nursing home residents, to help fund the Fair Deal scheme for the rest of the year.

Dr James Reilly said the new charges would be part of an estimated €62 million raised in savings.

Last month the Health Service Executive froze the scheme, which funds care for the elderly, after it was revealed that €100 million earmarked for it had been diverted elsewhere.

Dr Reilly said applications would be processed under the scheme from next Monday, with the HSE giving approval to those applications completed to final stage over the past few weeks in chronological order.

The savings and income would be used to deliver the 1,700 net increase in residents under the scheme for the rest of the year, he said. Expected savings of up to €30 million would be made in non-service related spending.

Dr Reilly added that despite the current economic climate, private nursing homes had received price increases over the past nine months, with the annual cost amounting to the order of €20 million.

Those were unsustainable in the current financial situation and he had instructed the National Treatment Purchase Fund to renegotiate the increases with a view to producing further savings.

Responding to a report on funding of the scheme from his officials and the HSE, the Minister said he felt the examination to date had not been as definitive or as comprehensive as he, and he was sure the House, would wish.

In the short-term, he had asked the HSE to put in place additional and more rigorous governance and reporting measures.

“My own officials will monitor closely developments over the remainder of the year,” the Minister added.

“I will also consider whether external auditors should be used to help bring clarity to the situation in the future.”

Dr Reilly said the savings had been identified as part of a wider review of the health system’s financial position.

There had been significant over-runs in the overall health budget so far this year and he hoped to announce shortly details of the proposed actions that would be taken to address the wider financial deficit and to support the HSE in its responsibility to operate within this year’s financial provision.

He said the report had made it clear that a number of factors were putting pressure on the overall Fair Deal budget this year.

These included an increase in nursing home costs and an unexpected and so far unexplained increase in the average length of stay for nursing home patients, from 2½ years in 2009 to four years.

The report had indicated that the nursing home support scheme was likely to face a deficit of €36 million this year, even if there were no net additions to it for the rest of the year.

It was also clear, Dr Reilly added,that payments from the Fair Deal subhead had been used to cover ancillary services such as therapies, drugs and medical services.

“It was initially estimated that the total cost of these ancillary services was around €100 million,” he added.

“However, further examination by the HSE has indicated that only €48 million of ancillary costs were billed to the Fair Deal subhead or pot.”

Earlier, Minister for Education Ruairí Quinn said proposed whistleblower legislation would be accelerated when he responded to Opposition questions about alleged physical and verbal abuse of elderly residents of the Rostrevor nursing home.

Mr Quinn, who was taking the Order of Business on behalf of the Government, said it might be necessary to introduce legislation sector by sector.