The impact of long-term care insurance on healthcare utilization and expenditures among middle-aged and older Chinese adults: a quasi-experiment study

Background: Long-term care insurance (LTCI) is essential to alleviate the challenges of rapid aging. Research on LTCI in developing countries is limited and conclusions remain controversial. This study aims to empirically evaluate how the LTCI pilot in selected cities influences healthcare utilization and expenditures among middle-aged and older Chinese adults. Methods: Data was from 2013, 2015, and 2018 China Health and Retirement Longitudinal Study. 167 LTCI and 8225 non-LTCI group participants were identified. Propensity score matching difference-in-difference method was used to evaluate the net effect of LTCI. The robustness of the findings was tested using a placebo test. Results: In the pilot cities, around 17.8% of the population had LTCI coverage, with approximately 59.9% participating in urban employee medical insurance and 81.4% being urban residents. LTCI significantly reduced the monthly out-of-pocket outpatient expenditure by 313.764 yuan (P < 0.05), but had no significant effects on the inpatient utilization and expenditure. Further analysis of vulnerable subgroup revealed that LTCI decreased monthly outpatient visits frequency, total outpatient expenditure, and out-of-pocket outpatient expenditure by 0.523 times, 643.500 yuan, and 302.367 yuan, respectively (P < 0.05). Robustness tests confirmed the stability of these results. Conclusions: The LTCI coverage rate has remained low. While LTCI has contributed to reducing outpatient utilization and expenditure, its impact on controlling inpatient-related outcomes is limited. It is recommended to broaden LTCI coverage beyond existing participants to encompass more vulnerable populations, and improve awareness and quality of LTCI services to achieve a significant effect on inpatient care.