• Industry: Healthcare
  • Type: Survey report
  • Date: 5/21/2013

Develop better funding models 

Develop funding models
Funding long term care is a huge issue that exceeds the scope of this paper and warrants its own separate study. Different countries are considering various mixes of public and private models, yet the scale of the challenge calls for innovative approaches to financing that are likely to challenge existing thinking.

Building a more skilled workforce, redesigning services and implementing new technology may ultimately bring greater efficiency, but such actions also require a level of investment beyond the means of many countries. Growing demand only adds to the shortfall and there has been a reluctance by politicians and policymakers to engage with this issue, especially in the wake of a continued recession.

“Financing in Germany – particularly for long term care insurance – will be challenged by the demographic changes. The financing for care programs should be sufficient to 2014 and then insurance will likely become more expensive.”

Michael Plazek, Research Associate, Public Governance Institute, Germany

Governments should think about how they can encourage working age citizens to save more for retirement and take out specific long term care insurance policies. Older people would also benefit from a wider range of equity release schemes to realize the value of their properties.

The burden of paying for future long term care inevitably falls on future generations. Younger people may be unwilling to make such a commitment and resent the need to support the elderly when times are tough enough already. In a bid to cut costs, a number of countries are rebalancing their long term care systems by relying less upon institutional care and more on home and community care. The table on the preceding page looks at some of these initiatives and there are further examples in “Appendix 1: Overview of long term systems for the elderly and their future direction”.

“There are policy schools, observatories and other ‘think tanks’ looking at developments in health and healthcare policy, financing, etc. There is no observatory for long term care or aging. This means that policymakers are flying blind. They are already in a position where they are not very clear on what they are funding. We need the same discipline in thinking about value in long term care that we are seeing develop in healthcare.”

Dr. Clive Bowman, Medical Director, Bupa Care Services, UK


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