Projecting Long-Term Care Expenditure in Four European Union Member States: The Influence of Demographic Scenarios

This study examines the sensitivity of future long-term care demand and expenditure estimates to official demographic projections in four selected European countries: Germany, Spain, Italy and the United Kingdom. It uses standardised methodology in the form of a macro-simulation exercise and finds evidence for significant differences in assumptions about demographic change and its effect on the demand for long-term care, and on relative and absolute long-term care expenditure. It concludes that mortality-rate assumptions can have a considerable influence on welfare policy planning. Relative dispersion between country-specific and Eurostat official estimates was found to be higher for the United Kingdom and Germany than for Italy and Spain, suggesting that demographic projections had a greater influence in those countries.