Putting England’s social care failings into a global context
By Integrated Care Journal-
England’s age-old social care quandary is far from unique. Declining birth rates, combined with an increase in longevity, have resulted in seismic demographic shifts across the globe. According to data from the United Nation’s World Population Prospects, one in six people will be over 65 by 2050. As the world’s ageing population increases, the resulting rise in care demand risks pushing long-term care systems to breaking point.
The challenges presented by an ageing population are global, and many countries have devised their own distinctive solution to the rising costs of social care. For many, step-change has been achieved through gradual reform over many decades.
In the early 1990s, Sweden implemented the Ädel reform to devolve responsibility for long-term care. In Germany, this was closely followed by the introduction of a public health insurance system, designed to cover basic social care needs. In 2000, Japan implemented long-term care provision through a national insurance system, compulsory for all residents aged over 40. Two years later, France introduced a universal and mandatory long-term care insurance scheme: the Allocation Personnalisée Autonomie. In the same decade, the Netherlands became the first country to introduce a universal mandatory health insurance scheme (AWBZ). Spain transformed its long-term care system with the introduction of System for Promotion of Personal Autonomy and Assistance for Persons in Situation of Dependency (SAAD). The Republic of Korea introduced mandatory long-term care insurance, Ireland reformed means-testing with The Nursing Home Support Scheme and the U.S. devolved health insurance reform to the state level with the Affordable Care Act. Finally, in 2012, Australia introduced the Living Longer Living Better (LLLB) package to give elderly care recipients more control over their care plans and improve access to care services.
Despite apparent progress made overseas, and successive proposals for reform, means-tested care funding has remained remarkably unaltered in England.
This period of significant international reform in the social care sector has not gone unnoticed in the UK. Over the past decade two major papers have been published: The Social Care and Health Systems of Nine Countries from the Kings Fund and An international comparison of long-term care funding and outcomes from Incisive Health. Each report offers comprehensive comparisons between long-term care frameworks to what we have here in England.
What can these papers tell us about the state of England’s social care system in comparison to our global counterparts? And what can we learn from their experience?
Broadly speaking, the funding models for long-term care can be categorised into taxation and insurance-based models. The systems in Italy, Spain and England are all funded through a combination of national regional taxation. While the Italian system is more devolved, Spain and England allow both taxation streams to flow into one central pot that is then redistributed out. The Revenue Support grant that central government has historically used to fund social care in England has been subject to significant cuts. As such, an increasing proportion of council tax has been used to bridge this gap. In contrast, the Netherlands, Sweden, Germany, Japan, France and the Republic of Korea all use insurance-based funding models to cover the costs of social care.
All of these schemes provide universal support (above a certain level of need) irrespective of financial need. Both reports found that insurance-based systems struggled with financial viability in the context of lower than anticipated insurance contributions and higher than anticipated population care needs.
Funding models matter. They determine how long-term care eligibility and service access are defined, and in turn, how risk is pooled across a population. Systems funded through general taxation are far more likely to use means-testing to restrict eligibility for state-funded social care. Means-tested systems ascribe a much greater proportion of out-of-pocket costs onto the individual than universal care systems, where risk is pooled across an entire population so that recipients of care bear less of this cost. As such, means-tested systems often generate unaffordable out-of-pocket care costs that restrict care service access and the creation of perverse incentives, where care provision centres around affordability instead of need.
England had the strictest means-test of all the countries examined in the Incisive Health paper. Other countries offer more generous programmes, such as a non-means-tested level of basic care in Germany, capped user charges in Japan and private insurance coverage of out-of-pocket costs in France. In contrast, the English system has become decidedly less generous over the past decade, as capital thresholds have remained unadjusted. The long-term care system in England has significantly less risk-pooling for non-health aspects of care than other countries. Interestingly, this stands in stark contrast to our healthcare system, in which risk is entirely covered by the NHS. While most countries examined in the report do offer more comprehensive coverage for health care than for social care, the division in generosity is generally less severe.
Quality of care
The ability of a long-term care system to provide high quality care is impacted by the benefits it offers to care recipients and the type of competition it fosters between care providers.
Long-term care benefits can be received in the form of in-kind services or cash benefits. While both options are available, the majority of care in England is provided through in-kind services. Systems that demonstrate a preference for in-kind services are generally considered more progressive. This is because they ensure high-quality care through regulated services, allow informal carers to engage in paid work and safeguard against the incentivisation of lower-income families to use cash benefits to supplement their income. Notably, it was found that those long-term care systems reliant on cash benefits, such as Italy and Spain, had higher care coverage rates than England, France and Germany. However, it is important to note that while those who require care are more likely to be provided with some level of care in these countries, high coverage rates do not necessarily translate into high rates of good quality long-term care.
Quality of care is better safeguarded by systems that base care provision competition on service standards, as opposed to service costs. Such is the case in Japan, where the prevention of price competition through the nationally determined prices has forced providers to compete on the quality of service provision. In England, where individual out-of-pocket costs are high, financial strain has restricted the ability of care recipients to choose providers on the basis of care quality provision.
Time for change
The English system of means-testing severely restricts access to long-term care. It has failed to adequately limit out-of-pocket care costs for the individual, in turn depriving many care recipients from choosing their care provider on the basis of service quality. International experience demonstrates that better frameworks for long-term care are within reach.
Major reform is possible. Many countries have implemented radical change to the funding and entitlements available in their long-term care systems. The development of political consensus over time, often through failed reform attempts and a series of smaller initiatives, is a major precondition for such change. Successful reform took 20 years in the Netherlands and 30 years in Korea. In France, there were two failed attempts at reform before the successful implementation of the APA. The English Government has been promising to overhaul the social care system since 1997, but since then we have only had failed attempts. Surely then, isn’t it about time we qualified for major change?
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