Substitutes or complements between informal and formal home care in the Canadian longitudinal study on aging:...

In Canada and around the world, policy makers are struggling with funding between informal care and formal home care. Understanding the relationship between the two types of care is helpful to inform funding allocations. In this study, we examined the relationship between informal care and formal home care and assessed whether this relationship varies across levels of functional impairment using the Canadian Longitudinal Survey of Aging (CLSA). Our study population was baseline CLSA participants between 2011 and 2015 who were functionally impaired. We used self-reported measures of total hours of informal and formal home care received over 12 months and evaluated their relationship using a two-part model and an instrumental variable method. Our results emphasized the importance of accounting for the potential endogeneity of informal care. We consistently found that there was a negative relationship between informal care hours and the probability of receiving formal home care among middle-aged and older adults and a negative coefficient of the interaction term between informal care hours and functional impairment level. The results suggest that there is a substitution relationship between informal care and formal home care and that this substitution relationship is stronger for highly impaired middle-aged and older individuals. Our findings will help policy makers understand the complexity of the relationship between informal and formal home care and implement policies accordingly.