The Supreme Court today ruled that legislation preventing people claiming back charges for residential care was unjust.
The seven-judge court decided the Health (Amendment 2) Bill was justified in imposing charges for in-patient services.
But the court found retrospective provisions barring those in need of care from recovering monies for fees unlawfully imposed on them unconstitutional.
The Bill was rushed through the Oireachtas just before Christmas after the Attorney General advised that the practice of making deductions from pensions of state care recipients was illegal.
The legislation required old people in nursing homes to fork out 80% of their pensions to pay for their care.
The Bill also regularised the practice of imposing charges for long stay in-patient services and provided that charges could be imposed on medical cardholders.
It also barred legal actions for the recovery of charges unless they were initiated by December 14, 2004.
In what it called a gesture of goodwill, the Government decided that those illegally charged for nursing home care in the past would be given €2,000 each.
The Bill was met with fierce criticism from opposition parties in the Dail and elderly care groups.
The Government will now be forced to redraw the legislation and return it to the Oireachtas for thorough examination.