What Happens to Nursing Home Debts After a Person Passes Away

When a person dies after spending the final months or years in a nursing home, there may be a debt to the nursing home which will be due for payment.

These outstanding debts may cause stress for spouses, children and family members of the deceased. The following is a short guide to the way nursing home debts are treated in Ireland.
If in doubt, get independent legal and financial advice.

Responsibility for Nursing Home Debt

In Ireland, nursing home debt is the responsibility of the deceased's estate and is paid after their death by their personal representative (executor or administrator).

If the deceased was in the Fair Deal Scheme, any outstanding loan facility from the HSE must be repaid from the estate (funded by the sale of the deceased’s property), usually:

• Within 12 months of death, or
• Within 6 months if the home was sold (prior to passing away) or transferred.

Nursing homes and the HSE can claim unpaid fees from the estate. If the estate is insolvent (has insufficient assets), these debts may go unpaid.

The Deceased's Estate is Responsible for Outstanding Debts

• Personal Representative: The executor (if there was a will) or administrator (if there was no will – known as dying intestate) will gather all the assets of the deceased.
• Insolvent Estate: If the estate's assets aren't enough to cover the funeral expenses, administration costs, and debts, it is considered insolvent.
• No Obligation for Children: Children of the deceased are not typically obligated to pay nursing home debts unless they were a guarantor for the debt or the debt was in their name as well. If the estate is insufficient to cover debts, the beneficiaries typically do not have to pay them personally.

Fair Deal Scheme and Loan Repayment

• Loan Postponement: Under the Fair Deal Scheme, the HSE pays nursing home fees, and a loan can be taken out based on assets like property, with repayment postponed until after the person's death.
• Repayment Timeline: This loan must be repaid within 12 months of the person's death, or within 6 months if their property is sold or transferred at any point.
• Interest: If the loan is not repaid by the due date, interest will be charged from the date of death.

Process of Paying Debts

1. Funeral and Administration Expenses: The first priority is to pay for the funeral and the expenses of managing the estate.
2. Preferential Debts: Next are preferential debts like taxes.
3. Ordinary Debts: Finally, other ordinary debts, such as nursing home fees and other unsecured debts (like credit cards and loans), are paid from any remaining assets.

If There Are No Assets

• If the deceased has no assets, the debts cannot be paid, and the creditors will likely have to write off the debt.
• The HSE and other creditors cannot claim the debt from the family of the deceased unless they are legally responsible for it.

What You Should Do

• Contact the Executor/Administrator: If you are a family member, you should contact the personal representative to understand the estate's financial status.
• Contact the Nursing Home: They will have details of any outstanding debts owing or that may not have been covered by the Fair Deal if the deceased was in the scheme.
• Contact the HSE: If you are unsure about the Fair Deal loan or the outstanding fees, contact the Health Service Executive (HSE) for clarity.
• Contact MABS: For further information, MABS – The Money Advice and Budgeting Service.
• Fair Deal: About the Fair Deal scheme.