INFORMAL CAREGIVERS: Provide Nearly $200 Billion in Unpaid Care
As President Clinton pushes for a $1,000 long term care tax credit, a study in Health Affairs finds that the market value of informal care provided to sick or dependent adults by family and friends was nearly $200 billion in 1997, dwarfing the $83 billion spent on nursing home care and $32 billion spent on formal home care. Peter Arno and Margaret Memmott of Montefiore Medical Center and Carol Levine of the United Hospital Fund used national databases to estimate the cost if caregivers were paid for their nearly 24 billion hours of work annually. At minimum wage, they predicted paying caregivers would cost $196 billion annually, the mid-range wage of $8.18 an hour would cost $115 billion and the high-rate of $11.20 an hour would cost $288 billion.
What to Do?
Though the authors said they are not necessarily recommending that all caregivers be reimbursed, they concluded that paying some "may provide a level of flexibility and continuity that is difficult to attain in the formal system." In addition, they suggested that the Family and Medical Leave Act could be extended to employees of smaller companies, and recommended an outreach campaign to inform them of their benefits. They also backed offering Social Security tax credits to caregivers who take time off work to care for sick adults. The authors noted that informal caregivers are "seldom adequately trained and almost never offered appropriate follow-up services, reevaluation of care arrangements or referrals to community services," and concluded that they "are left to negotiate an increasingly complex and fragmented system and to find whatever help they can by whatever means they can." In addition, they note that any additional cuts in spending for formal health care services "will only add to the already heavy burden on informal caregivers" (Arno et al., Health Affairs, March/April 1999 issue).