The ability to pay for long-term care in the Netherlands

A life-cycle perspective

Arjen Hussem*, Casper van Ewijk, Harry ter Rele, Albert Wong

*Corresponding author for this work

Research output: Contribution to journalArticleScientificpeer-review

Abstract

This paper uses synthetic life-cycle paths at the individual level to analyze the distribution of long-term care expenditures in the Netherlands. Using a comprehensive set of administrative data 20,000 synthetic life-cycle paths of household income and long-term care costs are constructed using the nearest neighbor resampling method. We show that the distribution of these costs is less skewed when measured over the life-cycle than on a cross-sectional basis. This may provide an argument for self-insurance by smoothing these costs over the life-cycle. Yet costs are concentrated at older ages, which limits the scope for self-insurance. Furthermore, the paper investigates the relation between long-term care expenditures, household composition, and income over the life-cycle. The expenditures on a lifetime basis from the age of 65 are higher for low income households, and (single) women.

Original languageEnglish
Pages (from-to)209-234
JournalDe Economist
Volume164
Issue number2
DOIs
Publication statusPublished - Jun 2016

Keywords

  • Life-cycle
  • Long-term care costs
  • Nearest neighbor resampling method
  • Self-insurance

Cite this

Hussem, Arjen ; van Ewijk, Casper ; ter Rele, Harry ; Wong, Albert. / The ability to pay for long-term care in the Netherlands : A life-cycle perspective. In: De Economist. 2016 ; Vol. 164, No. 2. pp. 209-234.
@article{76407e599e4c44809ec6aad4a78d31b3,
title = "The ability to pay for long-term care in the Netherlands: A life-cycle perspective",
abstract = "This paper uses synthetic life-cycle paths at the individual level to analyze the distribution of long-term care expenditures in the Netherlands. Using a comprehensive set of administrative data 20,000 synthetic life-cycle paths of household income and long-term care costs are constructed using the nearest neighbor resampling method. We show that the distribution of these costs is less skewed when measured over the life-cycle than on a cross-sectional basis. This may provide an argument for self-insurance by smoothing these costs over the life-cycle. Yet costs are concentrated at older ages, which limits the scope for self-insurance. Furthermore, the paper investigates the relation between long-term care expenditures, household composition, and income over the life-cycle. The expenditures on a lifetime basis from the age of 65 are higher for low income households, and (single) women.",
keywords = "Life-cycle, Long-term care costs, Nearest neighbor resampling method, Self-insurance",
author = "Arjen Hussem and {van Ewijk}, Casper and {ter Rele}, Harry and Albert Wong",
year = "2016",
month = "6",
doi = "10.1007/s10645-016-9270-7",
language = "English",
volume = "164",
pages = "209--234",
journal = "De Economist: Tijdschrift voor alle standen, tot bevordering van volkswelvaart, door verspreiding van eenvoudige beginselen van staatshuishoudkunde",
issn = "0013-063X",
publisher = "Springer",
number = "2",

}

The ability to pay for long-term care in the Netherlands : A life-cycle perspective. / Hussem, Arjen; van Ewijk, Casper; ter Rele, Harry; Wong, Albert.

In: De Economist, Vol. 164, No. 2, 06.2016, p. 209-234.

Research output: Contribution to journalArticleScientificpeer-review

TY - JOUR

T1 - The ability to pay for long-term care in the Netherlands

T2 - A life-cycle perspective

AU - Hussem, Arjen

AU - van Ewijk, Casper

AU - ter Rele, Harry

AU - Wong, Albert

PY - 2016/6

Y1 - 2016/6

N2 - This paper uses synthetic life-cycle paths at the individual level to analyze the distribution of long-term care expenditures in the Netherlands. Using a comprehensive set of administrative data 20,000 synthetic life-cycle paths of household income and long-term care costs are constructed using the nearest neighbor resampling method. We show that the distribution of these costs is less skewed when measured over the life-cycle than on a cross-sectional basis. This may provide an argument for self-insurance by smoothing these costs over the life-cycle. Yet costs are concentrated at older ages, which limits the scope for self-insurance. Furthermore, the paper investigates the relation between long-term care expenditures, household composition, and income over the life-cycle. The expenditures on a lifetime basis from the age of 65 are higher for low income households, and (single) women.

AB - This paper uses synthetic life-cycle paths at the individual level to analyze the distribution of long-term care expenditures in the Netherlands. Using a comprehensive set of administrative data 20,000 synthetic life-cycle paths of household income and long-term care costs are constructed using the nearest neighbor resampling method. We show that the distribution of these costs is less skewed when measured over the life-cycle than on a cross-sectional basis. This may provide an argument for self-insurance by smoothing these costs over the life-cycle. Yet costs are concentrated at older ages, which limits the scope for self-insurance. Furthermore, the paper investigates the relation between long-term care expenditures, household composition, and income over the life-cycle. The expenditures on a lifetime basis from the age of 65 are higher for low income households, and (single) women.

KW - Life-cycle

KW - Long-term care costs

KW - Nearest neighbor resampling method

KW - Self-insurance

U2 - 10.1007/s10645-016-9270-7

DO - 10.1007/s10645-016-9270-7

M3 - Article

VL - 164

SP - 209

EP - 234

JO - De Economist: Tijdschrift voor alle standen, tot bevordering van volkswelvaart, door verspreiding van eenvoudige beginselen van staatshuishoudkunde

JF - De Economist: Tijdschrift voor alle standen, tot bevordering van volkswelvaart, door verspreiding van eenvoudige beginselen van staatshuishoudkunde

SN - 0013-063X

IS - 2

ER -