Effects of public long-term care insurance on the medical service use by older people in South Korea

Public long-term care insurance (LTCI), which provides home and institutional care benefits, was introduced in July 2008 in South Korea. This study aims to evaluate the effects of the introduction of LTCI on older people's medical service use, including outpatient visits, inpatient services and longer stays (181 days or longer) in hospitals by implementing a quasi-experiment design with a generalised difference-in-difference method. The results showed that the introduction of LTCI did not change the use of outpatient medical services, although the medical costs of older people who used medical services at least once decreased by 9.4%. For the inpatient services, hospitalisation rates declined by 2.7% as a result of the LTCI. Length of stay and inpatient expenses decreased by 15.6 and 9.5%, respectively. For older people of LTC grade 2, eligible for long-term care facilities (LTCF), prolonged hospitalisation rates decreased by 1.6% due to the LTCI. In conclusion, the introduction of LTCI in South Korea has contributed to decreasing the use of inpatient services and longer stays in hospitals, which suggests that the utilisation of LTCF has become a substitute for some social admissions in hospitals.