Severe Cognitive Impairments and Long-term Care in Germany

Germany experiences an increase in LTC recipients, due to population ageing but also to reforms which made LTC benefits easier accessible for individuals with cognitive impairments. Previous studies documented the cost of long-term care, and how it evolved. However, less is known about the specific case of elderly people suffering from cognitive impairment. Thus, we measure the economic costs of cognitive impairment, which include extensive medical, nursing care and at-home long-term care. We use the SHARE, the Survey on Health, Ageing and Retirement in Europe, Wave 9. We observe 4% of elderly people living at home with severe cognitive impairment (SCI) (Langa et al. (2017) definition). These individuals are 30% more likely to receive any care, and obtain on average 6 more hours of formal care and 6 more hours of informal care per week. The main driver is not the cognitive impairment per-se but the limitation in activities of daily living (ADLs) which SCI leads to. Thus, once controlling for ADLs, SCI does not explain any additional probability to use care. However, because people with SCI are more likely to have ADLs, the annual cost of their care is estimated to 10,000 euros per year per individual on average.