Impacts of informal caregiver availability on long-term care expenditures in OECD countries

Objective. To quantify the effects of informal caregiver availability and public funding on formal long-term care (LTC) expenditures in developed countries. Data Source/Study Setting. Secondary data were acquired for 15 Organization for Economic Cooperation and Development (OECD) countries from 1970 to 2000. Study Design. Secondary data analysis, applying fixed- and random-effects models to time-series cross-sectional data. Outcome variables are inpatient or home heath LTC expenditures. Key explanatory variables are measures of the availability of informal caregivers, generosity in public funding for formal LTC, and the proportion of the elderly population in the total population. Data Collection/Extraction Method. Aggregated macro data were obtained from OECD Health Data, United Nations Demographic Yearbooks, and U.S. Census Bureau International Data Base. Principal Findings. Most of the 15 OECD countries experienced growth in LTC expenditures over the study period. The availability of a spouse caregiver, measured by male-to-female ratio among the elderly, is associated with a $28,840 (1995 U.S. dollars) annual reduction in formal LTC expenditure per additional elderly male. Availability of an adult child caregiver, measured by female labor force participation and full-time/ part-time status shift, is associated with a reduction of $310 to $3,830 in LTC expenditures. These impacts on LTC expenditure vary across countries and across time within a country. Conclusions. The availability of an informal caregiver, particularly a spouse caregiver, is among the most important factors explaining variation in LTC expenditure growth. Long-term care policies should take into account behavioral responses: decreased public funding in LTC may lead working women to leave the labor force to provide more informal care.