Organizing and Financing Health Care and Elderly Care

Public expenditures related to welfare are expected to eventually exceed revenues. So, what might the public commitment look like with regard to health care and elderly care in the future? And how is it to be financed? What will be the significance of the corona crisis for the organization and working methods in these areas?

Public Expenditure Related to Health Care and Elderly Care is Rapidly Increasing

An aging population will lead to a significantly increased need for health care and elderly care in the coming years. These two areas combined form a substantial part of the public commitment, while the growing need will over time represent an increasing burden on public finances. At the same time, the rapid urbanization process we are currently experiencing reinforces existing differences between urban regions and sparsely populated and rural areas. The ability to meet this growing need will thus vary considerably between different parts of Sweden. Technological developments have great potential in terms of increasing productivity in the health care and elderly care sectors. In practice, however, this often means increased costs.

Revenues for the Welfare System Increase at a Slower Rate

The welfare system is largely financed jointly by means of taxes, while also including elements of payroll taxation. As the working-age proportion of the population is expected to decrease, there is a risk that the welfare system will eventually be underfunded. The increasing demand for welfare services means that a growing share of production in the economy takes place in the public sector, where productivity growth is often slower compared to the private sector.