Extensions of Residential Care in the Federal States of Austria. Quantitative and Qualitative Effects of the Allocation of Public Funds Compared to Extensions of Formal Home Care

Against the background of an increasingly ageing society, rising employment rates and decreasing sizes of households, the efficiency of long-term care systems becomes increasingly important. The introduction of the federal Pflegefondsgesetz has put the different long-term care systems of the individual federal states of Austria into a common legal framework governing the continuous development and extension of formal care supply. According to this law, the extension of mobile home care is given priority over extending institutional care. This approach, however, requires certain substitutability between mobile home care and institutional care. Therefore, the first purpose of the present study is to critically compare mobile home and institutional care in order to demonstrate both the potential and the limitations of each type of care based on a review of the recent literature and on a survey of experts. The second purpose of the study is to project the future demand and costs for formal care services in each of the federal states based on the status quo, and to estimate the effects of the increasing shift from institutional to mobile home care and to other types of formal care. The findings can be summarised as follows: Mobile home care and institutional care demonstrate a limited potential for substitution. The allocative efficiency in both mobile home and institutional care can be increased by extending the amount of case and care-management provided. Intensifying the cooperation between the different groups involved (family, formal care, medical practitioners, hospitals) will further increase quality and efficiency. In all federal states the demand for mobile home care as well as for institutional care will increase substantially until 2030. The extent to which demand increases shows patterns of a west-east divide with higher increases in the western states. A reallocation of sources from institutional care towards mobile home care and alternative types of formal care is shown to be associated with a substantial decrease in public spending. However, given the limited substitutability between institutional and formal home care, the overall potential for such reallocation effects seems to be limited.