Preferences for Long-Term Care Services: Bequests, Informal Care and Health Expectations

Raun van Ooijen, Jochem de Bresser, M.G. Knoef

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Abstract

This paper studies people’s preferences for formal long-term care services provided at home, and examines how long-term care preferences relate to saving motives, such as the relative importance and type of the bequest motive, the availability of informal care, and health expectations. To elicit long-term care preferences, we use a stated choice experiment fielded in the Dutch LISS panel in which we ask people to choose between long-term care insurance plans offering in-kind benefits provided at home that differ in generosity. The results show that there is viable demand for insurance that covers long-term care services at home. Long-term care services represent a different value for different people depending on individual characteristics and expectations about long-term care needs. Having children, access to informal care, and a strong strategic-bequest motive reduces the willingness to pay for formal long-term care services. These results contribute to the understanding of saving behavior after retirement and design of long-term care insurance policies.
Original languageEnglish
Number of pages37
Publication statusUnpublished - Jan 2019

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Keywords

  • long-term care insurance
  • bequest motives
  • health expectations
  • informal care
  • life cycle

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