A framework for predicting gross institutional long-term care cost arising from known commitments at local authority level

Abstract

As the UK population ages, it is forecasted that there will be an unsustainable increase in the need for, and therefore in the costs of long-term care. Although several studies have been performed to estimate these costs, they do not take into account the impact of survival patterns on costs. Focussing only on residents already in care (known commitments), we have developed, in association with an English local authority, a framework for estimating the future gross cost incurred by this group, built around a survival model. We apply this framework to forecast the cost over a given period of time, of maintaining a group of individuals in residential and nursing care, funded by the local authority. One of the novelties in the model is that it translates survival inputs and unit fees for care into cost in a manner, which was useful and meaningful to decision makers.

Keywords:

• long-term care
• survival
• costing
• forecasting

Acknowledgements

We thank Teresa Temple and Peter Crowther from the London Borough of Merton Social Services Department for providing data and feedback during model development, and Peter Millard, visiting professor at the University of Westminster, for expert advice. This work was supported by the Engineering and Physical Sciences Research Council (GR/R86430/01).