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Projections of Future Demand and Costs of Aged Care Services in China

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Abstract

The growing demand for aged care services has become a pressing challenge worldwide. However, the future changes in demand for aged care services and the corresponding socioeconomic consequences in rapidly aging societies are not yet adequately understood. To achieve a better understanding of the future demand for aged care services, this study provides a set of comprehensive projections of the scale of demand for aged care services and the associated economic burdens between 2010 and 2050 in the context of China. Using a research framework based on the life cycle approach and a modified Personal Social Services Research Unit model, the study projects that the size of Chinese elderly population (i.e., aged ≥ 60) demanding aged care services will grow considerably, reaching 127.4 million in 2050 and costing 2.6 trillion yuan (or 1.01% of Chinese gross domestic product). Home-/community-based care services will be the form of aged care most in demand by the 70.21 million Chinese elderly people in 2050, and the most needed types of aged care services will be feeding assistance. The results of the sensitivity analysis indicate that demand for and costs of aged care services are sensitive to the assumptions about patterns of elderly disability and the prices of aged care services. The projected growth in the future demand and costs of aged care services warrants more heightened attention from Chinese policymakers and providers of aged care services. The implications for other rapidly aging societies are also discussed.

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Fig. 1

Source World Population Prospects 2017(United Nations, 2017) and OECD iLibrary https://www.oecd-ilibrary.org/

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Notes

  1. This study uses age 60 as the cut-off age for the elderly population in China given that the official retirement age for most Chinese men and women is age 60.

  2. As stated, the elderly population in the context of China refers to people aged 60 and older.

  3. Effective demand refers to the demand that can be fulfilled by the consumers’ purchasing power.

  4. CHARLS is an ongoing, nationally representative longitudinal survey with data obtained from 17,708 Chinese residents aged 45 years and older. Information of CHARLS can be found on its website: http://charls.pku.edu.cn/.

  5. This adjustment method is used to ensure the sum of every line in \({{\varvec{U}}}_{{\varvec{x}}}\) equals to 0 and all non-diagonal elements are positive if the non-diagonal elements of \({{\varvec{U}}}_{{\varvec{x}}}\) are less than 0.

  6. The use of HCBC has become increasingly prevalent in recent years in China through a growing number of publicly funded aged care programmes supported by the local or central governments.

  7. Since family care is a traditional way of aged care provision in China, it is set as a default type of aged care in this study.

  8. The average number of children per elderly person is measured by the ratio of the number of people aged 35–59 (\({N}_{35-59}\)) to the number of people aged 60 and older (\({N}_{60\le }\)), as shown in Formula (8).

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Funding

This work was supported by the Ministry of Science and Technology of China (Grant Numbers, 2018YFC2000603); the National Office for Philosophy and Social Science of China (Grant Numbers, 20ZDA076); and the Committee of Science and Technology of Beijing (Grant Numbers, Z191100004419001).

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Authors and Affiliations

  1. Centre for Health Systems and Safety Research, Australian Institute of Health Innovation, Macquarie University, Sydney, Australia

    Guogui Huang

  2. Centre for Workforce Futures, Macquarie University, Sydney, Australia

    Guogui Huang

  3. Institute of Population Research, Peking University, Beijing, China

    Guogui Huang & Gong Chen

  4. Department of Management, Macquarie Business School, Macquarie University, Sydney, Australia

    Fei Guo & Zhiming Cheng

  5. Social Policy Research Centre, University of New South Wales, Sydney, Australia

    Zhiming Cheng

  6. School of Business, University of New South Wales, Canberra, Australia

    Massimiliano Tani

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Huang, G., Guo, F., Cheng, Z. et al. Projections of Future Demand and Costs of Aged Care Services in China. Popul Res Policy Rev 42, 56 (2023). https://doi.org/10.1007/s11113-023-09803-0

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