Long-term Care Expenditures and the Red Herring Hypothesis: Evidence from the Oldest-old in China

Based on the 2008-2014 Chinese Longitudinal Healthy Longevity Survey (CLHLS) data, this research used the two-part model to evaluate the red herring hypothesis and explore whether age, time-to-death (TTD), or disability level affects the long-term care expenditures (LTCE) for adults aged 80 years and older in China. We found that age had no significant impact on the LTCE of the whole sample after including TTD and disability levels in the model, suggesting that TTD and disability are factors significantly associated with the growth of LTCE in China. Heterogeneities existed in total LTCE by gender and residential areas. After dividing total LTCE into explicit and implicit LTCE, we further found that only disability mattered in determining rising implicit LTCE. Our findings provide a basis and evidence for Chinese policymakers to establish prevention policies to delay disability and improve health of the oldest-old population.