Economic risk factors of long termcare - institutional LTC- How does income & socio-economic status effect ?- What are the...
BACKGROUND– THE FINNISH WELFARE STATE IN CHANGE30.5.2013 EERO SILJANDER, CHESS. 2
30.5.2013 Esityksen nimi / Tekijä 3
The challenges: population context – rapidageing scenario in Finland 2013.• A) Main point: It is forecasted that the numbe...
The solutions offered: Nordic model – the welfare state in change.• A) Finland is a Beveridge -orientated welfare state, b...
LONG-TERM CARE IN FINLAND –CARE NEEDS AND SERVICES.30.5.2013 Esityksen nimi / Tekijä 6
Welfare-mix in Finland/Older People *C) SOCIAL SUPPORT NETWORK OF AN OLDERPERSON•Complementary provider•Spouse, children, ...
8Primary care /basicservicesIntermediateservicesIntermediatecareMainlyLTC-carePrimary care/ outpatientcareLong term specia...
30.5.2013 Esityksen nimi / Tekijä 9
30.5.2013 Esityksen nimi / Tekijä 10
Some statistical facts about LTC -2010.• In Finland 10,3 percent of the 75+ population were ininstitutional care in 2010. ...
Longevity, services and social expenditure as %of Gross domestic product (GDP) – Scenarios.30.5.2013 Esityksen nimi / Teki...
INSTITUTIONAL CARE –(economist’s and econometrics view)30.5.2013 EERO SILJANDER, CHESS. 13
Research agenda – key questions.• Motto: We need more information in health economics on theeconomic* demand factors of LT...
Summary – empirical findings on care demand.• Empirical results for health from the literature:• A) Higher individual and ...
Econometrics strategy• Estimate competing risks models (Fine & Gray, 1999).• & multinomial logit models (Greene, 2005).• X...
30.5.2013 EERO SILJANDER, CHESS. 17TABLE3. Competing risk model.Censoring options: 1 = Institutionalentry (the competing r...
30.5.2013 EERO SILJANDER, CHESS. 18Table 3. Competing risk continued. Model 1.SHR Model 2.SHR Model 3.SHR Model 4.SHR Mode...
Cumulative incidence (risk %) – ylin (5.) ja alin (1.)tuloluokka –terveys & toimintakyky vakioitu.30.5.2013 EERO SILJANDER...
Cumulative incidence (risk, %) – Bereavement & break-up before LTC care –health&income constant.30.5.2013 EERO SILJANDER, ...
Summary of Results (1) – income factor.• In CIF-function (cumulative incidence function) competing risksduration analysis ...
Summary of Results (2) – health factors.• The competing risk and multinomial logit analysis showed thatforemost demand fac...
Summary of Results (3)• Looking at the marital covariates marital status and its changeis statistically significant for al...
Summary of Results (4)• The health behavior covariates in the model show consistent results with previous literature onwei...
THANK YOUVERY MUCH !Contact: EeroSiljander@thl.fi27.9.2012 Eero Siljander 27.9.2012 25
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Economic risk factors of long term care

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Eero Siljander, Centre for Health and Social Economics (CHESS), THL. Economics of Long-Term Care, Helsinki. 4. kesäkuuta 2013.

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Economic risk factors of long term care

  1. 1. Economic risk factors of long termcare - institutional LTC- How does income & socio-economic status effect ?- What are the economic incentives of care ?30.5.2013 HEALTH ECONOMIST, EERO SILJANDER, CHESS. 1
  2. 2. BACKGROUND– THE FINNISH WELFARE STATE IN CHANGE30.5.2013 EERO SILJANDER, CHESS. 2
  3. 3. 30.5.2013 Esityksen nimi / Tekijä 3
  4. 4. The challenges: population context – rapidageing scenario in Finland 2013.• A) Main point: It is forecasted that the number over 65+ populationwill double from current 900 000 to 1,8 million by 2060.• B) It is forecasted that the demographic dependency ratio (ratio of15-64 to under 15 & over 65) will change from 50,3 in 2008 to:• --> 70,5 by year 2026.• --> 79,1 by year 2060.• C) Tackling the “ageing of society” issue is important:• The Euro crisis and loomy economic outlook. Long-run futureeconomic growth expected to be on average slower.• Expansion of long-term care services and pension finance to beexpected because of population structure change and longevity.• Cost-effectiveness and quality of services need to be addressed.• Informal care and home care of older people rising on the politicalagenda. According to polls old age people want to live at home aslong as possible.30.5.2013 Esityksen nimi / Tekijä 4
  5. 5. The solutions offered: Nordic model – the welfare state in change.• A) Finland is a Beveridge -orientated welfare state, belonging to the so called Nordicwelfare model, together with Scandinavian countries• State and public sector major provider of LTC, that is tax-financed,• state having a guiding role in form of legislation, recommendations, nationaldevelopment programs and information guidance,• The role of private and third sector is minor but growing provider.• The so-called “SOTE” or “health and welfare” structures and governancereform under way. Financing model also under scrutiny.– * Goals: integrate health and social care horizontally and vertically.Internalize problems of different levels of care within same organization.• B) The government subsidises social and health care services provided by themunicipalities through state grants.– Every municipality is in principle (n=336) a service organizing unit. Median andmean inhabitant size is relatively low = 5 850 residents.– However, in practise co-organizing is also applicable and for many municipalitiesthe only reasonable option. Therefore municipal federations common in services.– Reforms of municipal structure is top priority of the current Katainenadministration. The target is to ensure financially strong enough local governmentunits for the future.30.5.2013 Esityksen nimi / Tekijä 5
  6. 6. LONG-TERM CARE IN FINLAND –CARE NEEDS AND SERVICES.30.5.2013 Esityksen nimi / Tekijä 6
  7. 7. Welfare-mix in Finland/Older People *C) SOCIAL SUPPORT NETWORK OF AN OLDERPERSON•Complementary provider•Spouse, children, relatives•Friends, neighboursA) PUBLIC SERVICES•Primary provider•Provided by the local authorities (municipalities)•Purchased from private or public providers (thepurchasing-provider modelB1) COMMERCIAL, FOR-PROFIT SERVICES,FIRMS• Supplementary provider•Private professionals•Private enterprises•Increasing especially inhome care, servicehousing and leisureactivities•“silver markets”B2) NON-GOVERNMENTALORGANISATIONS –PATIENT GROUP NGO’S•Supplementary provider•Organisations andfoundations•Voluntary work*Vaarama, M.2010
  8. 8. 8Primary care /basicservicesIntermediateservicesIntermediatecareMainlyLTC-carePrimary care/ outpatientcareLong term specialized care- somatic- psychiatricDay centres / day hospitalsfor the elderlyElderly homesHEALTH CARE SOCIAL SERVICESELDERLY CARE INFINLAND – 2011.Home services1. Home help, cleaning2. Supporting care- meals on wheels, transportationHome care allowance1. Home medical care2. Primary care3. Specialized care –outpatient careService housing (regular/24h)Primary care in-patient careAcute in-patientcareLong termspecializedcareHome careGeriatry Elderly social careInformal care byrelatives, friends,Neighbours, etc.1. Subsidy2. Support serviceDay centresIn-patient careSource:Noro A.,NIHW, 2011.08/17-19/2011 HEALTH AND SOCIAL CARE IN FINLAND 2011 / Eero SiljanderPUBLICSERVICEPROVISION
  9. 9. 30.5.2013 Esityksen nimi / Tekijä 9
  10. 10. 30.5.2013 Esityksen nimi / Tekijä 10
  11. 11. Some statistical facts about LTC -2010.• In Finland 10,3 percent of the 75+ population were ininstitutional care in 2010. (hospitals, health centres, 24hservice housing)• The same year 11,9 percent of the 75+ population werecustomers of home care services and 4,2 percent clientsof informal care subsidy & services.• The cost of institutional services was 743 milj. euros in2008 and the cost of home services was 451 milj. euros= total 1,2 billion euros.• According to some estimates annual institutional carecosts will rise by 21,5 % by 2020 and 60 % by 2040with current structures & population health level (source:Häkkinen, Martikainen, etc., 2008).08/17-19/2011 HEALTH AND SOCIAL CARE IN FINLAND 2011 / Eero Siljander 11
  12. 12. Longevity, services and social expenditure as %of Gross domestic product (GDP) – Scenarios.30.5.2013 Esityksen nimi / Tekijä 12- If service and care needsare postponed by 100 or 50percent with longevity thenmajor savings in socialexpenditure are expected.(Myhrman, Alila, Siljander,2009)- The scenario presentedearlier indicates the sameresult with 3 yearspostponement in LTC care.(Häkkinen, 2008). The Key in curbingexpenditure is reduction inmorbidity in commonpopulation diseases andpostponement of LTC care.
  13. 13. INSTITUTIONAL CARE –(economist’s and econometrics view)30.5.2013 EERO SILJANDER, CHESS. 13
  14. 14. Research agenda – key questions.• Motto: We need more information in health economics on theeconomic* demand factors of LTC-care. Cost-effective andmore productive service are a high priority with ageingpopulation structure... Thus we can ask:• 1) What are and How large are the income related factors ofinstitutional care? How do the changes in health and income reflectedin the results?– * what is the institutional context? What are the relevant health andfunctional ability controls ?• 2) What role for home care and informal care and family decisions?• - * strategic bequest motives, disutility from institutional care ?• 3) What are the motives for care? What economic incentives cansociety provide for caregivers?• - vouchers* for care, informal care allowance*, taxcredits/deductions*, personal budgets*.• 4) HrQoL –instruments (15D & HUI) predictive power and sensitivity ?Eero Siljander 21.3.2011 14
  15. 15. Summary – empirical findings on care demand.• Empirical results for health from the literature:• A) Higher individual and household income levels reduce the risk ofadmittance to institutional care when controlling for functional ability: Higheruse and purchase of home care services (Goda et.al., 2011; Norton, 2000;Headen et.al., 1993; Börsch-Supan et.al., 1992).• B) Limitations in functional ability (measured by IADL & BADL -instruments) are key determinant of care needs and the risk of admittanceto institutional care (Finne-Soveri et.al., 2005, 2008; Norton, 2000; Stern &Engers, 2000; Fried & Mor, 1997).• C) Diagnoses based on medical & medicine records explain LTC demand.Especially dementia and mental diseases but also Parkinson’s stroke,cancer (Einio, 2010; Martikainen et.al., 2009; Nihtila et.al., 2008).• D) Health-related quality of life (HrQoL) and self-reported health outcomes(15D or HUI) also have predictive power (Vaarama, 2010; Sarma et.al.,2007, 2009).• E) Health habits (muscle mass, underweight, overweight, tobacco)consumption also increase demand for institutional care (Landi et.al., 2012;Rockwood et.al., 2006, Janssen et.al., 2004 Gerdtham & Jonsson, 1998).30.5.2013 ILPN 2012 London Conference / Eero Siljander 15
  16. 16. Econometrics strategy• Estimate competing risks models (Fine & Gray, 1999).• & multinomial logit models (Greene, 2005).• X’s• 1) income, (age, gender) –variables,• 2) income, all socio-economic –variables,• 3) income, living habits,• 4) income, functional capacity,• 5) income, health exam diagnoses,• 6) income, all X-variables described in (1)-(5).30.5.2013 EERO SILJANDER, CHESS. 16
  17. 17. 30.5.2013 EERO SILJANDER, CHESS. 17TABLE3. Competing risk model.Censoring options: 1 = Institutionalentry (the competing risk is, 2 =death before entry). The referenceoptions is living in the community(Home) = 0 at end of ten year followup.Competingrisk model1. Income,age,gender,region.Competingrisk model 2.Income &socio-economiccovariates.Competingrisk model 3.Income, socio-economic,health habits.Competingrisk model 4.Income,socio-economicfunctionalcapacity.Competingrisk model 5.Income, socio-economic,diagnosisstatus.Competingrisk model6. Income &allcovariates.Covariates / explanatory XsStd.HazardrateStd.HazardrateStd.HazardrateStd.HazardrateStd.HazardrateStd.HazardrateLowest income quintile 1,000 1,000 1,000 1,000 1,000 1,0002.lowest income quintile 0,804* 0,886** 0,889** 0,927 0,891*** 0,875*middle income quintile 0,629*** 0,648** 0,649** 0,719*** 0,663* 0,687***2.highest income quintile 0,714*** 0,768*** 0,769*** 0,857*** 0,830** 0,852***highest income quintile 0,546* 0,630*** 0,633*** 0,775 0,723 0,815Under 60 year olds 1,000 1,000 1,000 1,000 1,000 1,00060-69 years olds 2,969*** 1,649 1,701 1,755 1,784 1,80470-79 years olds 10,645*** 3,967*** 4,191*** 3,327*** 4,065*** 3,516***80+ years olds 28,188*** 9,089*** 9,680*** 5,643*** 8,973*** 6,146***Male respondent 1,000 1,000 1,000 1,000 1,000 1,000Female respondent 1,213*** 0,904 0,929 0,577*** 0,974 0,640***Primary schooling 1,000 1,000 1,000 1,000 1,000Secondary schooling 0,979 0,984 1,041 1,015 1,041Tertiary schooling 0,816*** 0,824*** 0,886 0,882*** 0,935Working life participant 1,000 1,000 1,000 1,000 1,000Retired - old age pension 3,250 3,206 2,734 2,897 2,577Retired - handicap pension 2,398* 2,335* 2,378* 2,245* 2,210*
  18. 18. 30.5.2013 EERO SILJANDER, CHESS. 18Table 3. Competing risk continued. Model 1.SHR Model 2.SHR Model 3.SHR Model 4.SHR Model 5.SHR Model 6.SHRMarried and couples 1,000 1,000 1,000 1,000 1,000 1,000Widow 2,274 2,149 2,100 2,200 2,116Single 2,761** 2,722** 2,336*** 2,446*** 2,199***Divorced or separated (status 2000) 2,156*** 2,086*** 1,963*** 2,115*** 1,940***Divorced or separated between 2001-2010.16,119*** 16,089*** 14,923*** 14,856*** 13,212***Body mass index - below 18.5 1,371 0,872Body mass index - above 40 0,887 0,661Tobacco & smoking habit 1,323* 0,904Basic ADL -problems > = 1 (at leastone, # pcs.)1,540** 1,460***Instrumental ADL -problems >=1 (atleast one, # pcs.)1,597*** 1,515***Hand grip test score (maximum power,Newtons)0,997*** 0,997***Health_exam_Psychosis 4,995* 3,928*Health_exam_Depression 1,331*** 1,275***Health_exam_Dementia 4,181*** 3,726***Health_exam_other psychiatric_disease* 2,618*** 2,813***Health_exam_Parkinsons 3,562*** 3,364***Health_exam_Heart_AMI** 0,637* 0,627Health_exam_other_Heart_disease* 1,282*** 1,173***Health_exam_Asthma 0,657*** 0,564***Health_exam_COPD 1,657*** 1,503***Health_exam_Hip_osteoarthritis 1,155 1,092Health_exam_Diabetes** 1,302*** 1,088Health_exam_Stroke** 1,555* 1,370Health_exam_Cancer*** 1,613*** 1,516***
  19. 19. Cumulative incidence (risk %) – ylin (5.) ja alin (1.)tuloluokka –terveys & toimintakyky vakioitu.30.5.2013 EERO SILJANDER, CHESS. 19
  20. 20. Cumulative incidence (risk, %) – Bereavement & break-up before LTC care –health&income constant.30.5.2013 EERO SILJANDER, CHESS. 20
  21. 21. Summary of Results (1) – income factor.• In CIF-function (cumulative incidence function) competing risksduration analysis and controlling for all covariates in model 6. thedifference in cumulative incidence of institutional entry betweenhighest and lowest income quintile was:• - 1,3 percent for men and,• - for women 0,8 percent (overall 1,0 percent).• Thus for example if each quintiles consisted of 2 000 observations(N=10 000) each then 20 individuals less enter institutional care inthe highest income quintile than in the lowest over a 10 year followup. In institutional & medicine care costs difference is about 2million euros in Finland.• Because the whole elderly population for over 65+ year olds is900 000 inhabitants the result would amount to 180 m. € (24 % )!In 2008 total institutional care costs were 750 m.€30.5.2013 EERO SILJANDER, CHESS. 21
  22. 22. Summary of Results (2) – health factors.• The competing risk and multinomial logit analysis showed thatforemost demand factors were psychiatric diseases(dementia, psychosis, depression, other psychiatricdiagnoses) had the most influence on institutional entry risk.• The other major risk increasing significant diagnoses wereParkinson’s disease, Stroke, Copd-disease and cancer.• AMI and other heart diseases composite indicator was alesser of a factor for institutional entry (the compositeindicator includes the following diagnosis: angina pectoris,heart malfunction disease or heart rhythm disease, valvularheart disease).• The same lesser influence on LTC entry and risk of deathapplies for Asthma and Hip osteoarthritis.30.5.2013 EERO SILJANDER, CHESS. 22
  23. 23. Summary of Results (3)• Looking at the marital covariates marital status and its changeis statistically significant for all analysis groups. Being awidow increased institutional entry risk by 1.4 - 2.1 times,divorced by 1.4 -1.9 times and being single by 1.7 - 2.2 timesthe reference of couples at statistically significant levels(RRR, SHR).• The impact of separating from a spouse (due to death orotherwise) before beginning of institutional care increases therisk by 13.2 – 14.8 times the reference group (vs. no changein marital status). This result indicates previously foundbereavement effects (see Einiö, 2010) to be very high.30.5.2013 EERO SILJANDER, CHESS. 23
  24. 24. Summary of Results (4)• The health behavior covariates in the model show consistent results with previous literature onweight and smoking effects for LTC.• For smoking in relation to institutional entry the competing risk of death is increased by 1.3 and1.9 times the reference (SHR, RRR).• For low body mass (BMI<18.5) the hazard of institutional entry was (RRR=2.9**, SHR=0.9)heightened and death risk was increased by RRR=3.6.• For 40 < BMI it not lower or higher at statistically significant levels compared to those in the rangeof 18.5 < BMI < 40. The findings here are in line with previous findings of frailty, sarcopenia andrisk of death. Based on these result the underweight issue is a clear risk factor but overweightneeds to be investigated more closely in the future.• Functional capacity covariates are all statistically significant which indicates their importance inmodeling institutional entry and death.• Having at least some problems (reference no problems) in at least one of Basic ADL tasksincreased risk of institutional entry by 1.4 and 2.4 times (RRR; SHR) at statistically significantly0.001-level (***). There was also increased risk of death for IADL problems (RRR=2,4***).• For complete inability to perform (reference some ability) at least one instrumental ADL tasks theincreased risk of institutional entry by 1.5 times at statistically significant levels.• Better hand grip strength (in newtons, N) was associated with reduced risk for institutional entryand death. The effect of a one newton increase in muscular strength the risk of institutional entrywas decreased by 0.4 percent at average levels.30.5.2013 EERO SILJANDER, CHESS. 24
  25. 25. THANK YOUVERY MUCH !Contact: EeroSiljander@thl.fi27.9.2012 Eero Siljander 27.9.2012 25

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