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

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  • Pieter Bakx
  • Claudine de Meijer
  • Frederik Schut
  • Eddy van Doorslaer

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. Although 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 such as 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. Copyright © 2014 John Wiley & Sons, Ltd.

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  • Pieter Bakx & Claudine de Meijer & Frederik Schut & Eddy van Doorslaer, 2015. "Going Formal or Informal, Who Cares? The Influence of Public Long‐Term Care Insurance," Health Economics, John Wiley & Sons, Ltd., vol. 24(6), pages 631-643, June.
    • Handle: RePEc:wly:hlthec:v:24:y:2015:i:6:p:631-643
    DOI: 10.1002/hec.3050
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    4. Arjen Hussem & Casper Ewijk & Harry Rele & Albert Wong, 2016. "The Ability to Pay for Long-Term Care in the Netherlands: A Life-cycle Perspective," De Economist, Springer, vol. 164(2), pages 209-234, June.
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    7. Schmitz, Hendrik & Westphal, Matthias, 2015. "Short- and medium-term effects of informal care provision on female caregivers’ health," Journal of Health Economics, Elsevier, vol. 42(C), pages 174-185.
    8. Rapp, Thomas & Jena, Anupam B. & Costa-Font, Joan & Grabowski, David C., 2023. "Caregiving across generations: Do older adults with more grandchildren get another bite at the “sandwich” generation?," Social Science & Medicine, Elsevier, vol. 334(C).
    9. Bom, Judith & Stöckel, Jannis, 2021. "Is the grass greener on the other side? The health impact of providing informal care in the UK and the Netherlands," Social Science & Medicine, Elsevier, vol. 269(C).
    10. Roquebert, Q. & Tenand, M., 2016. "Pay less, consume more? Estimating the price elasticity of demand for home care services of the disabled elderly," Health, Econometrics and Data Group (HEDG) Working Papers 16/16, HEDG, c/o Department of Economics, University of York.
    11. Matthias Firgo & Klaus Nowotny & Alexander Braun, 2017. "Austria 2025 – Informal, Formal, or Both? Assessing the Drivers of Home Care Utilisation in Austria Using a Simultaneous Decision Framework," WIFO Studies, WIFO, number 59741, August.
    12. Arjen Hussem & Casper Ewijk & Harry Rele & Albert Wong, 2016. "The Ability to Pay for Long-Term Care in the Netherlands: A Life-cycle Perspective," De Economist, Springer, vol. 164(2), pages 209-234, June.
    13. Zhang, Wei & Sun, Huiying & L'Heureux, Jacynthe, 2021. "Substitutes or complements between informal and formal home care in the Canadian longitudinal study on aging: Functional impairment as an effect modifier," Health Policy, Elsevier, vol. 125(9), pages 1267-1275.
    14. Costa-Font, Joan & Jiménez-Martín, Sergi & Vilaplana-Prieto, Cristina, 2022. "Do Public Caregiving Subsidies and Supports affect the Provision of Care and Transfers?," Journal of Health Economics, Elsevier, vol. 84(C).
    15. Johannes Geyer & Thorben Korfhage, 2018. "Labor supply effects of long‐term care reform in Germany," Health Economics, John Wiley & Sons, Ltd., vol. 27(9), pages 1328-1339, September.
    16. Thomas Rapp & Jérôme Ronchetti & Jonathan Sicsic, 2021. "Are long-term care jobs harmful? Evidence from Germany," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 22(5), pages 749-771, July.
    17. Maarse, J.A.M. (Hans) & Jeurissen, P.P. (Patrick), 2016. "The policy and politics of the 2015 long-term care reform in the Netherlands," Health Policy, Elsevier, vol. 120(3), pages 241-245.
    18. Karmann, Alexander & Sugawara, Shinya, 2022. "Comparing the German and Japanese nursing home sectors: Implications of demographic and policy differences," CEPIE Working Papers 02/22, Technische Universität Dresden, Center of Public and International Economics (CEPIE).
    19. Eric French & Elaine Kelly & Pieter Bakx & Owen O'Donnell & Eddy Doorslaer, 2016. "Spending on Health Care in the Netherlands: Not Going So Dutch," Fiscal Studies, Institute for Fiscal Studies, vol. 37, pages 593-625, September.
    20. Marianne Tenand & Pieter Bakx & Eddy van Doorslaer, 2020. "Equal long‐term care for equal needs with universal and comprehensive coverage? An assessment using Dutch administrative data," Health Economics, John Wiley & Sons, Ltd., vol. 29(4), pages 435-451, April.
    21. Marianne Tenand & Pieter Bakx & Eddy van Doorslaer, 2020. "Eligibility or use? Disentangling the sources of horizontal inequity in home care receipt in the Netherlands," Health Economics, John Wiley & Sons, Ltd., vol. 29(10), pages 1161-1179, October.
    22. Ricardo Rodrigues & Stefania Ilinca & Andrea E. Schmidt, 2018. "Income‐rich and wealth‐poor? The impact of measures of socio‐economic status in the analysis of the distribution of long‐term care use among older people," Health Economics, John Wiley & Sons, Ltd., vol. 27(3), pages 637-646, March.
    23. Waitzberg, Ruth & Schmidt, Andrea E. & Blümel, Miriam & Penneau, Anne & Farmakas, Antonis & Ljungvall, Åsa & Barbabella, Francesco & Augusto, Gonçalo Figueiredo & Marchildon, Gregory P. & Saunes, Ingr, 2020. "Mapping variability in allocation of Long-Term Care funds across payer agencies in OECD countries," Health Policy, Elsevier, vol. 124(5), pages 491-500.
    24. Bom, Judith & Bakx, Pieter & van Doorslaer, Eddy & Gørtz, Mette & Skinner, Jonathan, 2023. "What explains different rates of nursing home admissions? Comparing the United States to Denmark and the Netherlands," The Journal of the Economics of Ageing, Elsevier, vol. 25(C).
    25. Longobardo, Luz María Peña & Rodríguez-Sánchez, Beatriz & Oliva, Juan, 2023. "Does becoming an informal caregiver make your health worse? A longitudinal analysis across Europe," Economics & Human Biology, Elsevier, vol. 50(C).

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