Elderly care cuts block hospital beds

Confidence: Low

On by default

Shape: Delayed

When elderly care (service housing, home care) is cut, some older people have to wait in hospital for a care place. A hospital day costs about twice a day in service housing, so part of the saving comes back as health spending within the same year.

Of every 100 euros that a change to “Old age (elderly care services)” saves or brings in, 30 € comes back as extra spending on the line “Health: hospital services”, starting after 0 yrs and building up to its full size over 1 yr. (The other way round if the change adds spending or cuts taxes.)

E(t) = s × T(t) × min(1, max(0, (n − delay + 1) / build-up))

Rough derivation: if about 15% of the care that is cut is replaced by waiting in hospital (the share is an estimate) and a hospital day (€308–359) costs about 2.1 times a day in service housing (€124–174), about 30% of the saving returns. The effect also works the other way: more care places free hospital beds.

Sources: Mäklin & Kokko (eds.): Unit costs of health and social care in Finland in 2017 (THL working paper 21/2020): a health-centre ward day €308 (short-term €359), a day of 24-hour service housing €124–174 (in Finnish)

How the effect builds up over time

Share of the change's own effect on the balance, year by year while the change continues: −15% means 15% of a saving comes back as cost (or 15% of extra revenue is lost). With the default values.

You can switch the effect on or off and adjust its assumptions in the simulator under Cause-and-effect chains.