Being dependent rather than handicapped in France: Does the institutional barrier at 60 affect care arrangements?

Individuals having difficulties to perform the activities of daily living may benefit from public long-term care (LTC) support. France distinguishes between handicap benefits, accessible to individuals below 60, and dependence schemes, for individuals aged 60 and older. This paper assesses the effects of the age 60 threshold in the French LTC policies using the French Health and Disability Survey (HS 2008{2009) in two ways. First, we estimate the effect of being 60 and older on the probability to receive non-medical formal care and informal home care, controlling for a rich set of socio-demographic characteristics and age effects. Being a \dependent elderly" rather than a \handicapped adult" little affects the probability to receive home care; however, it increases formal care utilization and, to a lesser extent, decreases the probability to receive informal care. Second, we implement a Regression Discontinuity (RD) approach and provide evidence that the institutional age threshold affects living arrangements, as individuals above age 60 are more likely to be recorded as living in an institution. The architecture of LTC policies affects the way individuals' day-to-day difficulties are being compensated, thereby undermining horizontal equity in the use of formal LTC.