Public long-term care insurance and expectations of future informal care for older adults: evidence from China

It remains uncertain whether and how public long-term care insurance (LTCI) influences older adults’ expectations regarding future informal care. This study aims to examine the impact of public LTCI on such expectations. Data were obtained from the China Health and Retirement Longitudinal Survey (CHARLS), a nationally representative longitudinal survey of Chinese residents aged 45 years and older, along with their spouses. By exploiting regional differences in LTCI implementation across the first round of pilot cities in China, we employed a triple-difference (DDD) approach to identify the causal impact of public LTCI on older adults’ expectations of future informal care. We robustly estimated the net effect of LTCI on these expectations and mitigated selection bias arising from potential confounders from both observable and unobservable sources by using alternative measures of the key explanatory variable, excluding the influence of other concurrent policy interventions, adding city-level covariates, and selecting second-round pilot cities as the control group. The implementation of LTCI increased the likelihood of older adults expecting to receive informal care in the future by 10.9%, especially among those who currently do not require long-term care (LTC) services. This effect was more pronounced for individuals with higher expected LTC risk, lower wealth, or limited insurance coverage. Stronger impacts were observed in pilot cities that prioritize home care, target severely disabled older adults, and offer combined cash and service subsidies. Regarding the underlying mechanisms, LTCI enhanced informal care expectations by increasing formal LTC service utilization and intergenerational financial support. These findings suggest that LTCI can increase older adults’ expectations of future informal care through changes in family care decisions and resource allocation. Therefore, LTCI policy design should consider China’s current socioeconomic context and cultural values surrounding LTC. Moreover, policymakers should focus on integrating family and social resources to ensure effective coordination between the informal and formal care sectors to maximize the benefits of LTCI policies for older adults and their families.