Decentralized policies and formal care use by the disabled elderly

Abstract: In a context of population ageing, public policies encourage the utilization of pro- fessional home care for the elderly living in the community. This chapter studies the determinants of professional home care use by the disabled elderly in the French con- text. It focuses on the effects of the regulation of the supply and the generosity of public financing. We use departmental variations in both the regulation of providers and the implementation of the main program devoted to the disabled elderly, the APA policy. We exploit an original survey on departmental practices matched with the HSM survey to estimate the determinants of formal care use, at the extensive margin. We find no effect of the departmental generosity while, on the supply side, when non-regulated providers — whose quality is uncertain and price is lightly regulated — dominate the market, the disabled elderly have a lower probability to use formal home care. Our results contribute to discuss both the questions raised by the decentralization of a national policy and the recent reform of the home care sector requiring all home care structures to be regulated.