Financing Long-term Care: Some Ideas From Switzerland; Comment on “Financing Long-term Care: Lessons From Japan”

Document Type: Commentary

Author

Institute of Insurance Economics, School of Finance, University of St. Gallen, St. Gallen, Switzerland

Abstract

Ikegami reviews the implementation of mandatory long-term care insurance systems in Germany and Japan, which are organized as pay-as-you-go systems. I propose to go one step further and implement a multi-pillar, mandatory and voluntary long-term care financing system, which combines pay-as-you-go with capital-funded elements. The proposal is based on the observation that Switzerland has implemented a three-pillar system for financing retirement provisions that can be adapted to finance long-term care in a fair and sustainable way.

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