Nursing home and separation

Hello, I am asking these questions for a friend. His wife has dementia and has been in a nursing home for over 6 years. He has been told that being apart for so long in the eyes of the law they are now considered separated.

The reason he is trying to find out this is because he has been told that if they are separated then there would be entitlements for his wife to help pay for her nursing home fees. Unfortunately they have too many assets to get the aged pension although they are both of age.
Does anyone know if this is true?

Hi dadsbid,
You will probably find that when it came to the crunch, your friend in all consciousness wouldn’t have been able to through with a legal separation anyway, regardless of whether his wife can still make her own decisions or not.

Unfortunately she can no longer make her own decisions. The power of attorney is interesting though. I think that my friend would still like control over her treatment and care so in that case it may be a catch 22 situation. I think the legal separation would not be worth doing. He is happy with the accommodation and medical help that she is receiving now and I know he would not like it to change and if he was to pursue a legal separation it may change. thank you for your input.

Hi Jill and dadsbid,
Also depending on how advanced your friends wife dementia is, would he still be able to legally proceed with this anyway? Can she still make her own decisions? Another question for the lawyer perhaps.

Hi dadsbid and Nellie,
My understanding is that once a member of a couple enters a residential aged care home they are considered as being “separated by illness” in the eyes of the Department Human Services (DHS) and entitles them to a higher rate of the Age pension. As far “legally separated” in the eyes of the law your friend would have to speak to a lawyer about this as I am not qualified to advise. The amount you contribute towards your ongoing care costs is based in your income and assets. If your income or assets reduce then your fees may also reduce. If your friends are deemed legally “separated”, depending on their financial circumstances , there could possibly be an impact on the aged care fees paid especially the means tested fee which is directly related to a persons income and assets which will change following a “divorce”. Also it is worth noting that there are annual and lifetime caps on means tested care fees. The maximum an aged care home can charge you is :$27,754.52 per year$66,610.90 in a lifetime. After 6 years it may be possible that your friend’s wife has already or will soon reach that lifetime limit depending on her contract terms with the home and particularly if she was receiving a Home Care package prior to entering residential care as that cost also contributes to the means test lifetime limit. Depending on the contract that your friends signed with the aged care home ie a RAD or DAP or combination of RAD/DAP accommodation payment there may be the opportunity to talk to the home about a different room etc which may carry a lower rate. I would suggest your friend speak to a lawyer to clarify what define “separation” (as opposed to illness separated couple) and its implications for them both as well as Power of Attorney, Advanced Care Directives etc. If there is a case to be had then I would also strongly suggest that he get advice from a specialist aged care financial adviser regarding how to best manage the aged care fees going forward.

Thankyou for your reply Nellie. I think he should just go to Centrelink and ask the questions himself. He is reluctant to do this, uncertain of how much red tape he has to go through which tends to put people off to start with. But thankyou again for your input.

Hi dadsbid and Jill,
Just wondering if for centrelink purposes that the friends situation would come under “couple separated due to ill health” ? Not sure if you want to take this to seriously unless the information came directly from either Centrelink or DHS. It could also open up another can of worms. I’m not sure how that would then affect Powers of Attorney. Pretty sure they are no longer valid in case of a divorce. Don’t know about them being valid if separated. And also how would that then affect their assets?