Working Paper: NBER ID: w31881
Authors: Jonathan Gruber; Kathleen M. McGarry
Abstract: The population of the United States, as with the rest of the world, is aging rapidly, with the most rapid growth occurring among the age 85 and older population, those who rely most on long-term care. In this chapter, we review the delivery and financing of long-term care in the U.S. We show that the resources of most elderly in the U.S. are insufficient to finance these ongoing long-term care needs and the public sector finances the majority of long-term care spending. At the same time, informal care plays a critical role, with the elderly at every age and every disability level receiving informal care more frequently than formal care. Indeed, when properly valued, informal care accounts for more than one-third of the nearly 2 percent of U.S. GDP devoted to long-term care.
Keywords: long-term care; aging; functional limitations; financial well-being; informal care
JEL Codes: H4; H50; I13; I18
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Insufficiency of personal resources (D14) | Reliance on public funding for care (H55) |
| Informal care (when valued) (D13) | Total cost of long-term care (G52) |
| Functional limitations (L15) | Financial well-being (G51) |
| Health limitations (I12) | Financial resources (G53) |
| Number of limitations (C34) | Financial resources (G53) |