| Spending on long-term care, at roughly 10% of national health expenditures, is large and increasing. However, long-term care expenditures are difficult to measure because free care provided by family and friends is hard to gauge and value. More than half of the disabled elderly rely exclusively on informal, unpaid care. Given the uncertain and expensive nature of long-term care, simple economic theory suggests that risk-averse individuals should purchase long-term care insurance. Paradoxically, the private long-term care insurance market remains small: In 2002, only about 6 million people had private long-term care insurance. |
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Posted July 30, 2007
