No Country for Dependent People
Italy is fortunate for having one of the highest life expectancies, but is unlucky in having one of the lowest birth rates in the world (1.3 children per woman, when it would take at least 2.1 to prevent population decrease). Combined, these two demographic trends are determining an explosion in the number of people in need of Long-Term Care (LTC), as well as a reduction in the number of family members who can actually provide it. In Italy there are currently 2.5 million dependent adults, projected to become 3.5 million by 2030, and 5.1 million by 2050. Each of them requires a family network of at least four people, so this means that at least 10 million Italians are deeply affected by the problem.
Italy's welfare system is presently based on four pillars. Firstly, about 60% of dependent adults receive an allowance of about €500 per month from INPS, the Italian social security agency, a transfer which is paid without means testing. The amount is insufficient for disadvantaged social classes and not so relevant for the better-off: 60% of checks are captured by the richer 50%.
The second pillar is given by by public health system that pays the medical fees for 200,000 beds in nursing homes. It covers around 40% of the total cost, leaving families with the burden of covering the remaining 60% of residency fees, at an average market cost of €70 per day (€ 2,100 a month). Then there are medical therapies to be done at home (for an average duration of two hours a week). Local government is the third pillar, which guarantees payment of residency fees for poor families living in protected facilities and a modicum of free care for the indigent in their homes, with an average frequency of three hours a week.
The fourth and most significant pillar is informal care, which gives work to 800,000 home carers. Approximately 90% of whom are foreign women with gray job contracts (i.e. families claim they work 25 hours weekly to ensure the renewal of their residence permit, when in fact they work 60). A caregiver costs about 50% of the cost of a nursing home, because of her low compensation and lack of rights on the job. This explains the drastic reduction in life expectancy of the guests living in nursing homes (which has declined to 6-8 months since the start of the 2008 crisis) because families put the elderly in nursing home only when two caregivers (break-even poin in terms of cost) are no longer sufficient to ensure assistance to the person in need. In sum, out 2.5 million dependent adults, 800,000 employ a so-called badante (home caregiver), 200,000 are hospitalized, and 1.5 million cope as they can with the help of their own families.
This existing LTC system has three serious problems. First, the system is highly fragmented between social security, public health, municipalities, private providers, leaving families alone with the burden of configuring a viable whole. The second issue is that fragmentation makes the system deeply unfair, because it allocates transfers without means tests, and more in general because it puts households that are less capable of navigating the archipelago of services, fees and charges at a disadvantage. Thirdly, the system is under-professionalized, because it is based in 90% of cases on the work of informal care givers, which means that improvised and random standards of service are the norm.
How to act in such framework? If someone found the courage to put the issue on the top of the political agenda, there are three possible ways to address the problem. The first is to correct the main micro-distortion: introducing means testing and transforming cash transfers into service vouchers; turning the scant visits of welfare workers into opportunities for consulting and supporting families and carers alike; differentiating the offer of residential housing for the elderly with the introduction of a low-threshold tier of access. The second way is to launch a national LTC policy, as most EU countries have done, reassembling into a single fund the current €32 billion for elderly people, perhaps increasing it with the revenues of an ad hoc tax, and allocate them in a unified manner as a function of need and income, by offering services rather than cash. Finally, the aphasia in public policy when it comes to LTC could at least be mitigated, and this is the third route, by promoting the creation of a professional market for carers, with strong tax incentives, based on a logic of demand recomposition (such as for instance, a single caregiver overseeing the needs of the elderly in a given building), supported for example by the increase in the value of the social security check for care of a dependent person if it is spent for accredited services, while giving up cash transfers to family households.
Not activating any of the policies above has very high costs. In terms of welfare policy, the need for LTC is so great that currently users are improperly appropriating resources from other divisions of the Italian welfare state, weakening their respective specific missions. For long-term care the Italian national health service spends €10-15 billion a year, while local governments consume 50% of their budget for social spending on dependent adults, and the Italian social security system is escalating its financial commitments to pay transfers to the disabled and the elderly. On the other hand, the current situation makes the lives of people in the need of long-term care and their families unbearable, while the unequal treatment of people with LTC needs is having a negative impact on citizens' trust in institutions and the community.