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considering the opportunity cost of informal care, the differences between the Netherlands and other
countries in the total costs of long-term care become much smaller (cf. European Commission 2022).
At the same time, the differences do not disappear entirely. For instance, while the share of GDP per
capita spent on formal long-term care is three times larger in the Netherlands than in the US, informal
care costs as a % of GDP are roughly twice as high in the Netherlands: 1.4% versus 0.7% (Gruber and
McGarry 2023).
Second, accounting for informal care not only has a large impact on the estimated level of long-term
care costs but also on the distribution of these costs. Formal care costs are paid for through public
programs and user payments make up for only a few percent of total revenues. Since the public
programs are funded by income-dependent premiums and general taxation, the costs of these
programs are by and large paid for according to ability to pay. By contrast, the opportunity costs of
informal care – as well as the health costs (Bom et al. 2019; Bom and Stockel 2021) – are fully borne
by informal caregivers, which is a selected and relatively small subpopulation. The findings presented
in this chapter show that the average informal caregiver provides a substantial amount of care
meaning that these opportunity costs per caregiver may be substantial too. Furthermore, the
demographic composition of the group of informal caregivers shows that some subpopulations, e.g.
middle-aged or older women, are more likely to provide informal care than others and thus take on a
greater burden, possibly despite being in a disadvantaged position for other reasons. Hence, factoring
in the costs of informal care also changes the view on the extent to which overall long-term care costs
are borne in an equitable way.
This conclusion also has implications for the consequences of future increases in long-term care use
when population ageing means that long-term care needs in the population will increase (De Meijer
et al. 2013). Will the costs of this additional care be covered through public programs that increase
expenditures when needs increase? Or by formal care users who pay greater user fees and by informal
caregivers who step in if public expenditure rises do not keep up with increases in needs? Ultimately,
how the costs of long-term care are allocated among three groups – society, users and informal
caregivers – is a political decision: to what extent is society willing, and able to continue to take an
increasing long-term care burden away from the other two groups (Bakx et al. 2020)?
Third, the threshold to receive formal care appears to be lower in the Netherlands than in other
countries. That is, the probability of formal care use is already substantial at low or moderate levels
of limitations. This is true for both home care and for nursing home care. Among the 85+ with 0-1
limitations, 44% receives formal care, of which 19% (i.e. 8% of the total population) receives nursing
home care. These individuals may have other limitations (e.g. cognitive limitations) that are not
captured by the measure that we use but that do cause a need for care. Yet, this percentage is twice
the percentage reported in the chapters for other countries that used similar measures to report
functional limitations (cf. Gruber and McGarry 2023).
Fourth, a relatively large share of formal long-term care workers in the Netherlands works parttime.
This suggests that shortages in the labor market due to the increasing demand for formal care workers
might be reduced if these workers can be persuaded to work more hours. Yet, persuading these
workers may prove to be a major challenge because of increasing competing demands, including a
rise in the demand for informal care rises. While informal care provision currently seems to have
limited impact on the labor market outcomes of caregivers (Rellstab et al. 2020), this might change
when demands for both formal and informal work increase.
Taken together, these findings highlight the importance of a complete view on long-term care use and
costs when formulating responses to the expected increase in need for long-term care in the future.
These findings are helpful in generating a better understanding of some of the trade-offs that policy