News Release

MONCTON (GNB) – The provincial government has unveiled a new and progressive policy to calculate the cost of nursing home care in New Brunswick. Under the new formula, many seniors – especially low and middle income earners – will see their contributions to the cost of total care drop, leaving them more money for necessities and partners or dependents that remain at home.

“We want to offer additional support to those New Brunswickers who need it the most,” said Social Development Minister Cathy Rogers. “But given our serious financial situation, we are also asking those who can contribute a little more to do so. This is necessary for our finances, but it is also necessary for the long-term sustainability of care in our province.”

Income scale

Currently, income is calculated towards the cost of care. Under the new policy, income will continue to be calculated but changes have been made to make the formula more progressive.

The new policy’s income formula will allow low to middle income individuals with a spouse or dependent at home to retain more of their monthly income. This will permit those who need help the most to contribute less towards the cost of their care.

Under this new policy, couples with household income under $60,000 will see their monthly contributions for care stemming from income decrease.

As an example, couples with a household income of $30,000 will see their monthly contribution for care stemming from income decrease by $117 per month.

Liquid financial assets

A new element of the policy is the factoring in of certain assets in the calculation of cost. The only assets that the new policy will factor into the calculation are certain liquid financial assets. Tangible assets, such as real estate including the family home, cottages, boats and vehicles will not be calculated.

Rogers noted that the liquid financial asset aspect of this policy will also not affect individuals who are currently in a nursing home.

“We know that seniors have worked their whole lives to build financial security and they should not have to lose what they have built in order to get proper nursing care,” said Rogers. “Only those who can afford to pay more are being asked to do so.”

Under the new policy, only certain liquid financial assets will be factored into determining the amount an individual contributes. These are referred to as eligible liquid assets and they include:

• cash;
• deposits in financial institutions (bank accounts and treasury bills);
• stocks;
• bonds;
• tax free savings accounts;
• guaranteed investment certificates;
• mutual funds; and
• investment funds and trusts.

The following liquid financial assets will not be factored in:

• registered retirement saving plan; and
• registered retirement income funds.

There will also be a $100,000 threshold on eligible liquid financial assets for couples and $50,000 for individuals. All assets that fall below the thresholds will be excluded from the calculation.

In addition, only a small percentage of those eligible liquid financial assets will be taken into account when calculating the cost on a yearly basis.

For couples, only 10 per cent of total liquid financial assets over the threshold of $100,000 would be factored in on a yearly basis in determining their contribution for care.

For individuals, only 20 per cent of total liquid financial assets over the threshold of $50,000 would be factored in on a yearly basis in determining their contribution for care.

The yearly top-up to the calculation would continue until the amount above the threshold is depleted.

Nursing home cost

Under the new policy, no resident, no matter how many liquid financial assets they possess, will pay more than $175 per day for care.

Since only 13 per cent of nursing home residents pay the current maximum of $113, an even smaller proportion would pay more than the current maximum under the new policy thanks to the new and more progressive income scale.

“This is still significantly less than the daily average cost to government,” said Rogers. “We are still subsidizing the cost of care for all seniors. To ensure that the system is sustainable over the long-term we are simply asking those who can contribute more to do so.”