Paying for Long-term Care*

This Policy Brief aims to present information on the current picture of (public and private) expenditure on long-term care (LTC) for older people and discuss the challenges of financing care. It also reviews the rationale for public funding of long-term care needs, since the funding is currently relatively low in most European countries when compared to other social protection areas. Also, funding schemes are skewed towards institutional care, even though most older people are cared for at home and age-adjusted nursing home usage rates have been falling. Contrary to health care user payments for long-term care can be quite high as a percentage of an individual’s income, especially for institutional care. This can raise questions about which income groups contribute the most to finance care, as users of long-term care are expected to be dispropor-tionately concentrated in poorer income groups. Using SHARE data, some initial results on the potential redistribution effects of home care benefits are also discussed