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The change of long-term care

Client

Bertelsmann Stiftung

Year

2019


On behalf of the Bertelsmann Stiftung, Prognos examined approaches to the further development of care professions in Germany’s aging society and the prospects for financing the social long-term care insurance (SPV) up to the year 2050.

Background and research questions

As a result of Germany’s aging population, in the coming decades, increasing numbers of people in old age will require help. The quantitative and qualitative changes in the need for care raises the question of how the care professions and their framework conditions will have to be developed further to guarantee a needs-based care. A key factor is the enhancement of professional care by strengthening the personal responsibility of care professionals as well as using more university-qualified care staff and advanced practice nurses.

The growing number of service recipients in the SPV sector will also increase the need for financing. How will the SPV contribution rate develop against this background? What impact do the different reform options necessary to cover such higher spending dynamics have on intergenerational equity?

Results

Under the current SPV funding model, the contribution rate would have to increase continuously over the next 30 years in order to ensure the security and quality of supply. The additional financial needs of the SPV could alternatively be offset by a higher (also tax-financed) long-term care fund. A financing option of this nature would better distribute the burden across generations. An example of how a more balanced intergenerational distribution of care costs could be achieved, is if the contribution rate for the establishment of a care pension fund was raised to 3.5% from 2020 and coupled with a federal subsidy. A further increase in the contribution rate would then no longer be necessary until at least 2050. This would put more strain on those born from 1990 and older, while relieving strain on all those born after.

While high-quality care is expensive, the anticipation today of the increasing burdens of the future renders it possible to finance it in a more evenly distributed and intergenerational way. The additional burdens for today's generations thus remain within a manageable framework.

The study (Bertelmann Stiftung website, in German)

Further information (Bertelsmann Stiftung website, in German)

Project team: Dr Oliver Ehrentraut, Gwendolyn Huschik, Dr Stefan Moog, Laura Sulzer

Last update: 01.01.2019

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Laura Sulzer

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Gwendolyn Huschik

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