Informal care at old age at home and in nursing homes: determinants and economic value.

This paper provides a comprehensive analysis of informal care receipt by the French individuals aged 60 or older. The literature has focused on the community, leaving informal care in residential care settings in the shadow. We leverage data from a representative survey (CARE) conducted in 2015-2016 on both community-dwelling individuals and nursing home residents. Focusing on the 60+ with activity restrictions, we show that 76% of nursing home residents receive help with the activities of daily living from relatives, against 55% in the community. The number of hours conditional on receipt is yet 3.5 times higher in the community. Informal care represents 186 million hours per month and a value equivalent to 1.1% of GDP at least, care in the community representing 95% of the total. We investigate the determinants of informal care receipt. Using an Oaxaca-type approach, we disentangle between two mechanisms explaining that nursing home residents are more likely to receive informal care, namely the differences in population composition (endowments) and the differences in the association of individual characteristics with informal care (coefficients). Both are found to have a similar contribution. Our results imply that private costs make up for the majority (76%) of the costs associated with long-term care provision once informal care is taken into account. They also highlight that informal care is extremely common for nursing home residents. Existing evidence on the determinants of informal care receipt in the community has, however, limited relevance to understand informal care behaviors in nursing homes.

Does the amount of formal care affect informal care? Evidence among over-60s in France.

This paper investigates the causal effect of the amount of formal care used on the informal care received by formal care users. We use an original instrument for formal care volume based on local disparities (NUTS 3 level, 96 units) in the price of formal care. Using the French CARE survey, we use a two-part model to assess the effect of formal care on the extensive and the intensive margin of informal care. An increase in the amount of formal care is found to be associated with a small decrease in the probability of using informal care. Heterogeneity tests show that this negative effect is mainly driven by help for daily activities provided by women. At the intensive margin, informal care is not significantly affected by the amount of formal care. Reforms increasing subsidies for formal care can thus be suspected to have a limited effect on informal care arrangements.

Health measures and long-term care use in the European frail population.

This paper explores the association between health measures and long-term care (LTC) use in the 70+ old population. We examine how different measures of health-subjective versus objective-predict LTC use, provided either formally or informally. We consider an absolute measure of subjective health, the grade given by the individual to his/her health status, and additionally construct a relative measure capturing the difference between this grade and the average grade given to health by individuals sharing the same characteristics. Conceptually, this difference comes from the perception of the individual, corresponding to both the private health information and the reporting behavior affecting self-rated health. We use the baseline data from the SPRINTT study, an ongoing randomized control trial on 1519 subjects facing physical frailty and sarcopenia (PF&S) in 11 European countries. Our sample population is older than 70 (mean: 79 years) and comprises a majority (71%) of women. Results show that self-rated health indicators correlate to formal care even when objective health measures are included, while it is not the case for informal care. Formal care consumption thus appears to be more sensitive to the individual's perception of health than informal care.

Pay less, consume more? The price elasticity of home care for the disabled elderly in France.

Little is known about the price sensitivity of demand for home care of the disabled elderly. We partially fill this knowledge gap by using administrative data on the beneficiaries of the main French home care subsidy program in a department and exploiting interindividual variation in provider prices. We address the potential endogeneity of prices by taking advantage of the unequal spatial coverage of providers and instrumenting price by the number of municipalities served by a provider. We estimate a price elasticity of around -0.4 that is significantly different from both 0 and -1. This less than proportionate response of consumption to price has implications for the efficiency and redistributive impact of variation in the level of copayments in home care subsidy schemes.