long-term care use and supply in europe: projections for germany ...

LONG-TERM CARE USE AND SUPPLY IN EUROPE | 5
variables that strongly influence institutionalisation rates and that are available for the countries
included in our study. Specifically, we consider:
- Age
- Gender
- Severity of functional impairment
- Cognitive impairment (dementia)
- Income
- Educational attainment
- Number of comorbidities
The main drivers of institutionalisation of elderly people are age and severity of functional impairment.
Both are strongly linked with the demand for care services; a high demand for care could necessitate
institutionalisation if informal care is not sufficient and if formal care in the community is too costly or
unavailable. When possible, the severity of functional impairment is captured by the number of
limitations in activities of daily living (ADL) 1 .
The demand for care services is correlated with two other variables: number of comorbidities and
cognitive impairment. The number of ADL limitations does not precisely capture care needs for elderly
people suffering from dementia because, when cognitive impairment becomes severe, people with
dementia often require permanent supervision, which can necessitate institutionalisation if such care is
not available in the community. For any number of functional impairments, cognitive impairment a
priori increases the probability of institutionalisation. In the same way, the number of comorbidities is
expected to positively influence the likelihood of institutionalisation because the burden of care in the
community is higher when elderly people suffer from comorbidities.
Choosing institutionalisation for an elderly dependent parent means renouncing community care
options. This renouncement, everything else being equal, depends on the informal care availability for
the elderly parent, i.e., on the extent to which it is possible for relatives to spend time caring for
dependent parents. There are many ways to approximate informal care availability, including whether
an elderly parent co-resides with another person and whether one or more children live in proximity to
the parent. A more sophisticated definition of informal care availability is based on informal care before
institutionalisation. However, using such data could introduce bias because the period immediately
preceding institutionalisation may entail especially time-intensive care (e.g., following a change in the
health and disability status of the elderly parent), which is not representative of actual informal care
availability. As such, we use the simpler means of measuring informal care availability in our
econometric estimates.
Income could negatively influence the probability of institutionalisation because wealthier people are
better able to afford care in the community, which may be expensive. Educational attainment is also
expected to play a role because it is a correlated with household financial resources and because
empirical evidence shows that informal care increases with educational attainment of the elderly parent.
Educational attainment is based on the ISCED97 classification whenever possible (see country-specific
ISCED codes) and is recoded in the following broad categories: Low (0-1), Medium (2-4) and High
(5-6).
1 The ADL are based on the six following items used in SHARE with categories 2 and 5 collapsed into one:
1. Dressing, including putting on shoes and socks
2. Walking across a room or 5. Getting in or out of bed
3. Bathing or showering
4. Eating, such as cutting up your food
6. Using the toilet, including getting up or down.