16 June 2025
LTC Insurance in China Lowers Costs for High-Need Patients
The programme significantly reduces the burden of health and care costs for those with complex needs - and has relevance across Global South
A new study has revealed that China’s long-term care insurance programme significantly reduces the financial burden of health and care costs for older adults with cognitive and physical limitations.
As China’s population ages rapidly, the demand for long-term care is soaring. Yet many older adults face devastating out-of-pocket costs.
The researchers say China's experience offers lessons for many countries across the Global South where care costs are spiraling due to ageing populations.
This study by researchers from the Department of Global Health and Social Medicine is among the first to show that the insurance programme can reduce these risks—though only if eligibility criteria are inclusive, and reimbursement rates are sufficient.
The study introduces the concept of Catastrophic Health and Long-Term Care Expenditures (CHLTCE), a comprehensive measure that includes not only healthcare costs but also formal and informal long-term care expenses.
“Traditional measures underestimate the true financial burden faced by older adults with disabilities,” said lead author and PhD student, Chengxu Long. “Our study shows that long-term care insurance can offer meaningful protection - especially for those with severe cognitive impairments or chronic conditions.”
Published in the European Journal of Ageing, the study analysed data from the China Health and Retirement Longitudinal Study spanning 2011 to 2018, focusing on 9,312 individuals aged 60 and above with cognitive or physical limitations.
It found that informal care costs, often overlooked, make up a significant portion of household financial strain.
Long-term insurance coverage reduced the risk of catastrophic expenditures by up to 18% at high thresholds, and the protective effect was strongest for individuals with severe cognitive impairments and those with both physical limitations and chronic diseases.
However, the programme had limited impact for those with milder impairments or without chronic conditions.
Professor Karen Glaser said their study highlights the need for policymakers to expand long-term insurance eligibility to include those with mild cognitive impairments.
“They should also look at adjusting benefits to reflect complex care needs, not just physical disability. We also recommend increasing reimbursement rates to provide more comprehensive financial protection for vulnerable populations,” she said.
Co-author Dr Wei Yang added: “This research has global relevance. Countries across the Global South are grappling with aging populations and rising care needs. China’s experience offers valuable lessons.”
Read the full paper:
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PhD student
Director of the Institute of Gerontology
Professor of Gerontology