Funding options for long-term care services in Latin America and the Caribbean

Beatrice Fabiani, Joan Costa-Font, Natalia Aranco, Marco Stampini and Pablo Ibarrarán

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: Demographic and social changes Latin America and the Caribbean (LAC) have called the traditional system of long-term care service provision into question, prompting many countries to prioritize long-term care reform on their social policy and fiscal agendas. A central policy issue under consideration involves assessing the demand and the costs of various long-term care options while evaluating its financial sustainability. To date, estimating the demand for care in Latin American countries is limited due to the underdeveloped and fragmented systems in place. This paper estimates the potential cost of various long-term care service packages that differ in the extent and type of government funding. Second, we investigate the financing sustainability of different coverage scenarios across seventeen countries in the LAC region. Finally, we assess the feasibility of alternative funding mechanisms and discuss the main benefits and drawbacks considering each country's unique institutional constraints. Our estimates indicate that, while all seventeen LAC countries have the potential to implement a system funded through general taxation, a social insurance system is only feasible in a handful set of LAC countries.

Keywords: long-term care; population aging; Latin America and the Caribbean; social insurance; public finance; tax financing (search for similar items in EconPapers)
JEL-codes: H50 I18 J14 J18 O54 (search for similar items in EconPapers)
Pages: 12 pages
Date: 2025-03-31
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Published in Journal of the Economics of Ageing, 31, March, 2025, 30. ISSN: 2212-828X

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Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:127121

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