Canada's National Institute on Ageing examines if a long-term care insurance program is required to address a major societal issue
Ageing Canadians are already concerned about having enough money to fund their retirement, but one cost can derail well-designed plans.
The downside to a population that’s living longer is that more people will require long-term care – and that means a significant financial burden that may not have been planned for.
The National Institute on Ageing has been considering whether Canada should introduce a publicly-funded long-term care (LTC) insurance program.
By taking a deep dive into how these programs work in five countries and one US state, its new study concludes that the model needs more serious consideration.
Citing 2019 figures, the study highlights the $38 billion that was spent on LTC by Canada’s governments and more than $9 billion that was privately funded.
It also notes that LTC can cost up to $3,500 a month for a typical household, while those with complex needs that require 24-hour care and support could be facing a $25,000 monthly bill!
Although there is private LTC insurance available, it is a small market in Canada, meaning often-unaffordable premiums.
A solution could be a publicly-funded insurance program, either from a specific contribution from Canadians’ wages, similar to the Canada Pension Plan model; or through general taxation, similar to how the national health insurance program is funded.
Basic care and funding
Although such a program would not eliminate costs completely for Canadian families, it would at least provide a basic level of LTC, standardized across Canada, and a sustainable funding model for the future, the report says.
“It’s already clear that the current level of public funding has not been enough on its own to meet Canadians’ LTC needs,” says Dr. Samir Sinha, Director of Health Policy Research for the NIA. “Establishing a national LTC insurance program could present a unique opportunity to re-imagine Canada’s social contract and better align its provision of LTC services to the needs and preferences of older Canadians, giving them more opportunities to Age in the Right Place.”
