Table 1 Relevant regulatory differences among three facility types

Market entrance

-Supply control: authorities can reject approvals in terms of their referring levels capping bed density [28] -Service provision planning by each municipality as insurer & prefecture

-Not subject to authorities’ provision planning (-2006)

-No supply control under LTCI: LTCI funds must contract with any provider who meets quality standard [24].

-No supply control (-2006)

-Need planning: abolished

Providers

-Not-for-profit; small minority is municipal

- Majority is for-profit

-Mixed: for-profit & not-for-profit; minority is municipal

Financing LTCI

-Half by contributions & half by taxation [32] (Public payers: state, prefecture & municipality)

-Half by contributions and half by taxation [32] (Public payers: state, prefecture & municipality)

-Financed solely by contributions

Financing care fees

-Fees: publicly fixed

- Fees: publicly fixed under LTCI

-Before LTCI: fully financed based on cost- recovery-principle [23]

-Co-payment before LTCI: according to ability-to- pay principle

-Different according to eligible levels

-Fees: bargained between providers & social-assistance (SA) sponsor/LTCI funds etc.; reflecting facility’s individual costs for each eligible level

-Co-payment under LTCI: 10% of fees

- Co-payment: 10%

-Benefits under LTCI: publicly fixed and capped, according to eligible levels

-Different according to eligible levels under LTCI

-Care fees for PNHs are lower than that for IFs

-Users who cannot co- payment: eligible for SA

Financing hotel costs (accommodation & meals)

-Fees: Publicly fixed; not adjusted to local price/rent level

-Fees: market-based; set by facility

-Before LTCI: fully financed based on cost- recovery-principle [23]

- Co-payment: depending on room type and income

-Fully paid out-of-pocket

-Fees: individually bargained between LTC fund and facility (provider) based on costs [33]

-After 2005, middle and high income users are no longer subsidized & pay full price set by facility out-of-pocket

-Not subsidized

-Fully paid out-of-pocket -Users who cannot co- payment: eligible for SA

-Users who cannot co-payment eligible for SA

Interests of insured persons

Preferable to other residential facilities due to higher subsidies, not-for-profit status & no time-limits [34]

More expensive alternative to IFs

-SA-recipients: preferable to other services due to higher subsidies

-Not-SA-recipients: more expensive than home care due to considerable out- of-pocket payments [24]

Interests of authorities (J) & LTCI funds (G)

Economic incentive to constrain IF supply & fees, but politically for need-oriented provision

Economically preferable due to lower benefits & almost no subsidy compared to IFs

No strong economic incentive to constrain fees & expenditures

Subsidy for (initial) capital costs

- Amount is based on a national standard [28]

Rarely

-Before LTCI: directly paid (only to not-for-profit facilities)

-Paid directly by state

-Under LTCI: capital costs are fully financed by users separately from hotel costs; low- income users are subsidized for capital costs

-Sometimes additionally subsidized depending on municipal decision

-Land acquisition subsidized decreasingly

Significance

-24% of LTC beneficiaries use IFs (2009; calculated based on official data [35])

-4% of LTC beneficiaries (2009; incl. PNH-similar facilities; calculated based on official data [35])

-30% of LTC beneficiaries (2009) [27]

-LTCI gave a boost in development of PNHs

Clientele with LTCI benefits

- Eligible persons assessed as heavily independent

All LTC eligible persons

-All LTC eligible persons

- Low-income users as majority

- SA-recipients: about 80/30% of users (before /under LTCI) [24, 36]