Open AccessThe Role of Private Finance in Paying for Long Term Care *
Author(s) -
Mayhew Les,
Karlsson Martin,
Rickayzen Ben
Publication year - 2010
Publication title -
the economic journal
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 4.683
H-Index - 160
eISSN - 1468-0297
pISSN - 0013-0133
DOI - 10.1111/j.1468-0297.2010.02388.x
Subject(s) - term (time) , political science , library science , management , sociology , public relations , business , economics , computer science , physics , quantum mechanics
An ageing population and increased longevity means that long term care will become progressively more expensive. In 2009 the Government published a Green Paper on future funding options and a White Paper in 2010. This article considers the role of private finance products under the ‘Partnership’ option. It finds that few households are able to pay for LTC based on income and savings but the number increases if housing assets are included. We show that products can be devised for a range of circumstances, although state support would need to continue. We propose a simplified means testing system based on a combination of income and assets.