Going Formal or Informal, Who Cares? The Influence of Public Long-Term Care Insurance

28 Pages Posted: 6 Feb 2013

See all articles by Pieter Bakx

Pieter Bakx

Erasmus University Rotterdam (EUR)

Claudine de Meijer

Erasmus University Rotterdam (EUR) - Erasmus Medical Center (MC)

Erik Schut

Erasmus University Rotterdam (EUR)

Eddy van Doorslaer

Erasmus School of Economics

Date Written: February 4, 2013

Abstract

International differences in long-term care (LTC) use are well documented, but not well understood. Using comparable data from two countries with universal public LTC insurance, the Netherlands and Germany, we examine how institutional differences relate to differences in the choice for informal and formal LTC. While the overall LTC utilization rate is similar in both countries, use of formal care is more prevalent in the Netherlands and informal care use in Germany. Decomposition of the between-country differences in formal and informal LTC use reveals that these differences are not chiefly the result of differences in population characteristics but mainly derive from differences in the effects of these characteristics that are associated with between-country institutional differences. These findings demonstrate that system features like eligibility rules and coverage generosity and, indirectly, social preferences can influence the choice between formal and informal care. Less comprehensive coverage also has equity implications: for the poor, access to formal LTC is more difficult in Germany than in the Netherlands.

Keywords: long-term care, informal care, international comparison, SHARE, decomposition

JEL Classification: I11, I14, I18

Suggested Citation

Bakx, Pieter and de Meijer, Claudine and Schut, Erik and van Doorslaer, Eddy, Going Formal or Informal, Who Cares? The Influence of Public Long-Term Care Insurance (February 4, 2013). Available at SSRN: https://ssrn.com/abstract=2211670 or http://dx.doi.org/10.2139/ssrn.2211670

Pieter Bakx (Contact Author)

Erasmus University Rotterdam (EUR) ( email )

Zuid-Holland
Netherlands

Claudine De Meijer

Erasmus University Rotterdam (EUR) - Erasmus Medical Center (MC) ( email )

Doctor Molewaterplein 40
Rotterdam, South Holland 3015 GD
Netherlands

Erik Schut

Erasmus University Rotterdam (EUR) ( email )

Burgemeester Oudlaan 50
3000 DR Rotterdam, Zuid-Holland 3062PA
Netherlands

Eddy Van Doorslaer

Erasmus School of Economics ( email )

Netherlands

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