Caring Connections in Italy: The Role of Immigrant Caregivers in Improving the Welfare of Elders and Reducing Public Health Costs

We examine the impact of migrant-provided home-based care on elderly health in Italy, focusing on hospitalisation frequency, length of stay, and mortality. To address potential endogeneity between local health conditions and immigrant settlement , we use an instrumental variable approach. Our results show that an higer supply of migrant caregivers reduces both the frequency (extensive margin) and duration (intensive margin) of hospital admissions. One percentage point increase in the immigrant-to-elderly population ratio leads to a 4% decline in long-term and rehabilitation inpatient admissions, with no effect on acute inpatient. We also find a 1.5% reduction in average admission duration, rising to 3.3% for LRI cases. These effects are primarily driven by diagnoses related to traumatic injuries, musculoskeletal and genitourinary conditions—areas closely linked to home-based mobility and care management. Back-of-the-envelope calculations suggest that the observed 1.3 percentage point average annual increase in the migrant-to-elderly ratio during our study period corresponds to an estimated 9% reduction in elderly LRI hospitalisation costs, yielding annual public savings of approximately 0.66% of total hospitalisation expenditures.