Long Term Care in Italy

Presenter: Vincenzo Rebba, Università degli Studi di Padova

Abstract

Firstly, I describe the demand and supply of Long-term care (LTC) services in Italy. Then, I analyse the recent proposals of reform of Italian LTC system, which entail both an enlargement of public intervention and an increased role for complementary private health insurance. The analysis will focus in particular on the role of complementary LTC insurance and its effects in terms of efficiency and equity.

Italy has the highest proportion of population over 65 in Europe (20% in 2007) which is expected to increase to more than 35% in 2050. In 2004 there were approximately 2 million of elderly dependent people (around 19% of the total over 65). In comparison with the mid-90’s, the total number of frail elderly grew (+9,4%), but quite less than the more general increase in the amount of the elderly population (+24,2%). However, while the relative weight of dependency did not increase in the last decade, the degree of disability changed enormously: the most severe cases (more concentrated among the very elderly) increased dramatically in the last 10-15 years. Demographic evolution threatens the viability of existing welfare system, particularly in the LTC area.

In Italy the supply of LTC has been traditionally characterised by a low level of public provision and funding, if compared with other central-northern European countries. In 2006, public expenditure on LTC for the elderly was around 1.1% of GDP and it is expected to increase to 2.4% by 2050. Italian public LTC system is currently based on two parallel forms of intervention with separate criteria for eligibility: the first, and most relevant, consists of a cash program (“indennità di accompagnamento”); the second is given by local social and health programmes, including the provision of residential and home care. The care responsibility has been mostly delegated to family networks even though the traditional caring capacity of Italian families has been strongly reduced in the last decade owing to the continuous growth in the women employment rate, which has not weakened by the increasing reliance of the LTC public system on the traditional cash-transfers. This phenomenon, combined with the persistence of a limited public supply of LTC services, has favoured the creation of a market response to the problems of dependency with a dramatic growth of private paid care provided by low-cost migrant female workers.

The current configuration of Italian LTC seems completely inadequate (both in terms of efficiency and of equity) to cope with the foreseen evolution of demand. In recent years both the political debate and the scientific literature aimed at developing a reform of the Italian LTC system. Most of recent proposals provides for:

a. an enlargement of public financing through the set up of an universal and mandatory coverage to protect dependent persons, similarly to German social LTC insurance system;

b. the development of subsidised complementary private insurance schemes (covering LTC services outside from the basic public package) in order both to mitigate out of pocket payments and to increase the efficiency in the utilization of private resources.