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Forecasting Lifetime and Aggregate Long-term Care Spending: Accounting for Changing Disability Patterns

de Meijer, Claudine A. M. MSc*,†; Majer, Istvan M. MSc; Koopmanschap, Marc A. PhD*,†; van Baal, Pieter H. PhD*,†,§

doi: 10.1097/MLR.0b013e31824ebddc
Original Articles

Objective: The impact population aging exerts on future levels of long-term care (LTC) spending is an urgent topic in which few studies have accounted for disability trends. We forecast individual lifetime and population aggregate annual LTC spending for the Dutch 55+ population to 2030 accounting for changing disability patterns.

Methods: Three levels of (dis)ability were distinguished: none, mild, and severe. Two-part models were used to estimate LTC spending as a function of age, sex, and disability status. A multistate life table model was used to forecast age-specific prevalence of disability and life expectancy (LE) in each disability state. Finally, 2-part model estimates and multistate projections were combined to obtain forecasts of LTC expenditures.

Results: LE is expected to increase, whereas life years in severe disability remain constant, resulting in a relative compression of severe disability. Mild disability life years increase, especially for women. Lifetime homecare spending—mainly determined by mild disability—increases, whereas institutional spending remains fairly constant due to stable LE with severe disability. Lifetime LTC expenditures, largely determined by institutional spending, are thus hardly influenced by increasing LE. Aggregate spending for the 55+ population is expected to rise by 56.0% in the period of 2007–2030.

Conclusions: Longevity gains accompanied by a compression of severe disability will not seriously increase lifetime spending. The growth of the elderly cohort, however, will considerably increase aggregate spending. Stimulating a compression of disability is among the main solutions to alleviate the consequences of longevity gains and population aging to growth of LTC spending.

*Institute of Health Policy & Management

Institute for Medical Technology Assessment (iMTA), Erasmus University Rotterdam

Department of Public Health, Erasmus Medical Centre, Rotterdam

§Expertise Centre for Methodology and Information Services (EMI), National Institute for Public Health and the Environment (RIVM), Bilthoven, The Netherlands

The authors declare no conflict of interest.

Reprints: Claudine A. M. de Meijer, MSc, Department of Health Policy & Management (iBMG), Erasmus University Rotterdam, PO Box 1738, 3000 DR Rotterdam, The Netherlands. E-mail:

© 2012 Lippincott Williams & Wilkins, Inc.