China is rolling out what some are calling its sixth social insurance, the long-term care insurance.
On paper, the cost looks quite minimal, just 0.3% of income.
But the ambition is anything but small and to fundamentally shift how care is delivered, from unpaid family labor to a professional system.
So today we ask, how can this 0.3% really help solve a growing care crisis?
And what does it take to turn a policy promise into real support for millions of families?
Coming to you from our studios in Beijing, this is Roundtable.
I'm Fei Fei.
For today's program, I'm joined by Niu Honglin and Steve Haverly.
First, on today's show.
Imagine an elderly who can no longer eat alone, who needs help getting out of bed.
That daily responsibility falls entirely on family members.
They may lose their wages, suffer sleepless nights and the quiet erosion of their well-being.
For years, this was by and large a private struggle.
But over the past decade, a quiet policy experiment began changing.
That long-term care insurance, or what some are calling the sixth social insurance, has grown from a small pilot to a system covering 35 million elderly people, and even more in China.
It doesn't just pay bills.
It sends professional caregivers to people's homes, turning a family crisis into a shared social responsibility.
And now the government has set a three-year timeline to take this system nationwide.
So how exactly does this care insurance work?
And what does it mean for society to formally declare that caring for the vulnerable is not a private burden?
Hello, Hongling and Steve.
Thank you for joining me today.
And first of all, let's talk about this sixth social insurance.
And what exactly is that?
Well, we see, on March 25th this year 2026, the country issued a set of guidelines to accelerate the establishment of this nationwide social insurance, long-term care insurance system, meaning that nowadays, if we see it go according to plan after three years, everybody would be participate in contributing into the system and by putting in a little money, every individual, and a little money from each and every company, we establish this pool.
With this pool of money, you can use it to improve the infrastructure of elderly care facilities.
You can help those who are in need, get better services and also avoid the kind of situation that with one person all of a sudden, because of an accident, because of the Being in an aged, situation where they lose the ability to take care of themselves, dragging the entire family down to a situation where they can no longer function properly.
Yeah, this is a big deal for the country and there's a lot of details.
That have gone into this plan.
So there was a long term care insurance service that it was a list that came out.
It was put out by the government in September of last year.
So what it stated was a long-term care fund would pay for 20 living care services there.
We're talking about things like assistance with meals, toileting and hygiene.
Also, 16 medical care services involved, including general checkups, basic care services.
A bit of rehab involved in that.
For eligible insurance participants, all of those things would be included.
And the reason that we are looking at the attempt to put it nationwide is that the piloting program has been there for quite a long time, actually 10 years in.
Ever since 2016, nearly 310 million people have enrolled and over 33 million people with disabilities have benefited from the program already.
With funds spending surpassing 100 billion yuan, or around 145 billion US dollars.
The average annual burden on individuals have been eased by about 12 000 yuan or 1700 us dollars, so that is quite significant for a family or an individual.
And now we're talking about some changes, perhaps based on these palatine programs carrying out throughout the country, and we are not talking about having another social insurance putting in place.
And that can be quite a bit of an explanation that we need to do to our listeners.
First of all, it's about what exactly, for example, China's social insurance system work.
You know, right now, I think, we pay five different kinds of insurances and there is a fund for the housing, which is a different story.
But when it comes to the five different insurances, Hong Ling, what are they?
It's a very interesting question. quite a specific situation here in China.
I think before joining Workforce when I was a university student, one of the criteria for finding a legitimate company to work in is to see whether or not the company would pay for the five different insurances.
Because, even if Paying for that would suggest that you would receive a little less of your salary every month, because all of these five insurances requires this kind of payment structure or contributing structure.
That is, you pay for a little bit of it and then your company pay for a little bit of it.
So that's the structure of the contribution.
Yet your company is paying some part of it and you at the end would benefit from it.
So what are the five insurance we're talking about?
The social insurance is the basic pension insurance.
That means after retired, you can still get an amount of money based on your previous salary.
So that is the kind of income you would get after retirement.
And then the basic medical insurance that is every month you pay for a little bit of it.
But if there is a situation requiring you to go to the hospital, a part of your medical bill is covered by the system, in a way, by the country, by the society, by this basic medical insurance and then work injury insurance.
That is self-explanatory because in different companies, the situations are different.
And I think the plans are different.
But in general, work insurance or work injury insurance is mostly paid by the company.
And it has something to do with the nature of the job, because some job are more sensitive to certain disease and they would pay for a bit more in that front so that if something happened employee would be able to benefit.
And the other one is unemployment insurance.
This one is also quite interesting because i think on roundtable we've covered The fact that sometimes when an employee loses their job they can accept the kind of training they can enjoy certain kind of subsidies in housing or in relocating to a different place so that they can find a different job.
Those money are from the unemployment insurance pool.
Yeah, we have that in Canada too, in Nova Scotia where I'm from.
And it's basically put in place because sometimes it takes a while to find your next position.
And during that time, you still need to... live and eat and pay the bills and stuff.
So yeah, we have a similar system.
Exactly.
And the last but not the least, something I have already benefited from would be the maternity insurance.
So here in China maternity insurance cover the kind of spendings that when you are ready to make a family getting pregnant, you go have a lot of hospital checks.
Some of those money are covered within this maternity insurance.
And for those office ladies, for those who are working, because you would enjoy maternity leave for Around half a year, depending on where you live, depending on different provinces.
Maternity insurance would also give you compensation during your maternity leave, meaning that even if you're not working, you still get a bit more money, not from your company, but from the maternity insurance company.
So when you go on maternity leave, when a person goes on maternity leave, they're not paid.
They're not paid entirely because some of their income is kind of like bonus.
It has something to do with their work performance.
So definitely without working.
They still get their basic income or basic salary, but they do not receive as much.
And that's where maternity insurance would come in and give compensation.
And now.
Mostly these fundings come from employer contribution, employee contribution, financial subsidies and investment returns, meaning that the employee themselves, the company a legitimate good company and the government all pitch in to make sure the safety net of the society exists.
So in certain situations we can get you know covered.
We can be caught by the society.
Yeah.
And, for example, when it comes to medical insurances.
I think both individual and the companies they contribute a combined rate about 8.
And out of this, 8 based on the employee's salary, 2 is paid by the individuals and the other roughly 6 is contributed by the employers.
And that money goes into a pooled fund and that fund will be used when you are in demand.
And I think these kind of similar contribution standards also apply to these long-term care insurances.
We introduced that in the beginning of the show.
It's about 0.3%.
And how exactly will employee, the individual us, and employers, the companies, will divide this contribution?
So this is where the math comes in, which I'm not great at, but I think I can handle this one.
There was a professor from the University of Finance and Economics, and the professor explained it in a way that I think is quite easy to understand.
It answers the why 0.3% that you mentioned, Feifei.
Well, the contribution amounts will kind of vary naturally across different regions of the country.
And the reason for that is because of differences in income levels.
So if you have Citizens of Hainan, for example, where incomes are generally lower, then they would pay less, while those in Zhejiang if that's a good example where incomes might be higher, then they would pay more.
So it's equitable, and it's equitable especially considering that the cost of services also differs.
And I think you might wonder, this sounds closer to pension system and also closer to the medical system, because if you have a good system there, Maybe it can cover part of the long-term care.
And I think you're not wrong if you're thinking like that, because the logic of designing all of these insurance systems is kind of
Kind of the same.
It's like finding a risk pooling and you see the large medical costs are shifted from individuals to a wider collective, while also deductibles and caps and reimbursement ratios and drug services list control spending kind of.
So that a family would not face the huge risk.
The risk can be shifted and can be shouldered together by the entire society once it's formed.
And that's why the 03 contribution rate is the result of the math, of the calculations, because it's not only about income pay, it's also about the cost factor of healthcare too.
For example, if you have or if you need an hour of in-home service, healthcare service well, that might cost 100 yuan in one part of the country, but it might cost 50 yuan or less in another part of the country.
So you can't just focus on the absolute disparity in contribution amounts, which is what we talked about first.
Right,
Depending on your income, it's also depending on how much things cost.
Yeah, and that's why we need pretty much three years.
That's what the government, the goal that government set is over the time of three years they will go to different provinces and even cities.
And also when it comes to contrast.
You know, some people are signing a contract with a company, but others are sort of unemployed.
I think we also cover on that.
And also we have flexible jobs on the market at the moment.
So they need time to test the water a little bit and to see exactly how we sort of detail this kind of scheme, this kind of system, because it can be quite complicated.
We have employees of the enterprises and institutions.
We have unemployed urban and rural residences.
We have retirees.
We have flexible workers.
And there are also special groups that we need to take into consideration.
So it's a lot of math that the country needs to do.
But the biggest question here, I think, is, Who will be the beneficiary of this fund?
Who is going to benefit from this large amount of fund, putting into the pool every month and every year out of the paycheck of everybody in every company?
Well, you're absolutely right when you say it's a large amount of money.
Considering the entire amount.
But for each and every individual, I think it's minimal.
It's fine.
Negligible.
Negligible over there.
But those who can actually benefit can lift a huge burden from themselves, from their family, because to qualify, we're looking at someone with a disability status that has lasted for generally more than six months and pass a formal disability level assessment and in the initial stage, the system primarily guarantees benefits for those assessed as severely disabled.
Yeah, and that doesn't take age into account.
No.
It doesn't matter if you're old or young.
That is why I think it's related to medical insurance and the pension system, but it's also different from it.
It's trying to cover a wider range of people with disability, because Generally they might not need to visit hospitals that often anymore, meaning that they cannot benefit from the medical insurance system.
Yet they need constant care, long-term care, as the name suggested.
So getting someone from the family taking care of them would be overwhelming.
A burden.
I know.
I know.
Yeah.
Cold.
But it's like financial responsibility.
A responsibility.
But financially is something that the family need to arrange for.
I need to juggle.
And if you're finding someone from the society to take care of them, a professional caregiver would also be mean a big amount of money.
And that is why the country is trying to use this system to provide a safety net for those group of people.
Yeah, and this is why they unified it too, because the system, the insurance, doesn't typically hand out cash to people.
Instead, it pays for the services that are provided.
So, for example, smart yeah, it is a very good, it's a well-designed system.
Uh, if you shanghai, for example uh, before they had their own status set of standards and maybe And Zhejiang would have another set of their own standards.
But it was in September of last year, I mentioned it before, right?
The Unified National Service Package of 36 items.
So the 20 daily living care items, I gave some examples before, right?
Eating, bathing, cleaning.
And then the 16 medical nursing items.
Right, that would be things like a catheter care or wound care or basic care rehabilitation, things like that.
This becomes a unified system.
That's the scope, whereas previously, different regions would have their own set of standards.
Now it's all the same.
Yeah, and the founder, i think, pays approximately 6, 70 percent for employees and retirees, as well as 50 for residents.
And they also have a cap that says shall not exceed 50 of the per capita disposable income of urban and rural residents in the pooling area from the previous year.
That's the annual maximum.
And also you can choose.
You can choose from home care you know you have caregiver coming to your home or community care.
You know you can go to a center or rehabilitation center, for example, for this kind of services.
Or you can go to institutional care, which can be nursing homes.
And that payment preferences will be given to home-based or community care services.
So yeah, as Steve mentioned, they're not really cash giving out.
But do we have like real examples?
I mean, these kind of data can be very abstract.
Yeah, it sounds complicated, but in real life it's carried out in a pretty simple and pretty considerate way.
We have, for example, a 82-year-old Wei Mei Fen, and this person is from Cixi City in Zhejiang Province.
Wei has been bedridden for a really long time.
And, since being assessed as having level two, severe disability, she has been entitled to 25 hours of monthly in-home care.
So here in China, 90% of elderly cares do happen within the family.
And that is why these in-home care is one of the most in need kind of services.
And so caregivers visit regularly to provide professional services, while the agency dispatches nurses to handle medical tasks.
For example, in Nantong, Jiangsu Province, A market-oriented, socialized and professional long-term care insurance system has been established, benefiting over 130000 families with members with disability.
And the system provides nearly four hours of home-based service per week and an annual cap of 8000 yuan, or around 1100 US dollars, for assistive devices, reducing the annual financial burden for those with severe disabilities by up to 25000 yuan.
And like Steve has already mentioned, this is not prone to only elder people.
In fact, a young person with disability with severe situations can also enjoy the services.
We see a care worker can visit regularly and perform limb passive exercises and muscle massages to relieve tension.
And they also assist with oral hygiene and feeding.
And this professional care improves the individual's physical condition, mental status.
And also, I think it allows people in the family to, you know, Get constant help.
And peace of mind.
Peace of mind might be the biggest point out of all of this.
And I think we should mention too.
You know if you're listening and you're thinking, oh well, an extra health insurance.
I have to pay more for this.
Like, this is going to be expensive.
And we keep giving you a lot of percentages.
But we've said already the cost is really negligible here.
To put that into context for you if an employee and this would be the example for employees of companies or institutions if an employee made 10000 yuan a month that's about 1450 roughly then the individual contribution is about 15 yuan a month.
That's about $2.20.
And the employer contribution is about 15 yuan per month because it's divided in the company.
So that comes out to 30 yuan a month.
And that is the cost of, what, two candy bars or five candy bars or something like that.
It's really not a big difference for people compared to the benefit that families and individuals get from this type of program.
Exactly.
And when we think about the fact that we mentioned this all the time on Roundtable.
China is stepping into an aging society.
And there are different fronts when it comes to an aging society.
One specific topic we discussed was the fact that those younger elder people are now taking care of their elder parents and it can cause problems in the sense that they cannot enjoy their silver years as much because they're still, even after retirement, a 60 year old, taking care of an 80 or 90 year old, meaning that they have to work and in a family, a little bit harder and that would increase the risk of them, caught in certain kind of accident, injuring themselves, causing more problems to the family.
And when the medical technology continued to improve.
We are looking at more elder, elder people, which is a good thing.
The longevity is improving, but it is also quite difficult.
Obvious that those who need long-term care would increase.
The number would increase.
This industry will need money to be put in.
We are looking at the situation that needs a collective effort from individual companies and the entire society.
Yeah, that reminds me of one of the co-workers before that.
She retired a couple of years ago and checked on her.
You know how do you enjoy your retirement year.
You know, you're finally relieved from all the work pressure coming from the workplace.
She said no, I haven't been really enjoying any of the time because I have to take care of my mother who's suffering from Alzheimer's.
So I've been staying at home taking care of her 24-7 and it's just so, so stressful.
And after, I think, Two or three years later, she told me she's thinking about sending her mother to a nursing home because she's also reaching to a limit of dealing with an Alzheimer patient at her home.
Sure, she's not a trained individual, right?
Yeah.
And also, you know, her mother's personality changed drastically because of Alzheimer's as well.
And that's also draining on her mentally as well.
So that's why I think the system is providing this safety net.
For those that can face a big financial burden.
If we are thinking about sending your parents suffering from chronic conditions, it can cost, I think, 10000 yuan, or more or less than that a month.
If you are sending an elderly with limited mobility to a professional institution, it is a big financial burden throughout the country.
So this kind of system is sort of the safety net.
I think in the past the long-term care provided has been covered partially by our medical insurance pool, but that's not a long-term strategy, isn't it, Hongling?
I don't think so, because if you take a look at all these five different types of insurances, the last three ones sounds relatively more direct and not that complicated, because it's more like a temporary situation.
But pension insurance and medical insurance can be relatively more complicated.
Pension insurance can be complicated because it has to handle long-term payouts.
You pay for your entire working period and then get quote, unquote.
Get it back starting from when you're retired.
And also we are looking at the intergenerational sharing, because those money you receive are mostly quote unquote contributed by the employee these days.
And also we're looking at regional balancing situation.
We need to deal with aging pressure all at once and these tensions would accumulate over time.
So different types of adjustments and quote-unquote changes revolutionary policy changes happens all the time to make sure the system is still stable.
And when it comes to the medical insurance, it's also seeing a lot of reforms because it faces combined pressure from medical progress.
You see, the development of technology, meaning that some diseases are all of a sudden curable, which means we should discuss whether or not to include it in the medical insurance plan.
And also aging and chronic disease growth.
Uh, rising costs, that's a thing as well, and also the changing care patterns.
So each reform, we often see these reforms trying to change the payment methods, trying to change the coverage lists, trying to see what is the most reasonable personal accounts plus um contribution from the society, kind of pattern.
And I think this one we're talking about here is another wave of changing, another wave of making the system more stable and trying to dispatch the risk of individual or a family to the entire society.
On the way, but I think we've been painting a quite rosy picture here with this long-term care insurance.
It's like you're pitching a little bit maybe 15 yuan out of your paycheck every month when you need it or your family member need it.
The help is there.
But what about, you know, looking into the future?
What are some of the challenges?
Well, you said the help is there.
But the help may not be there.
The help needs to be there.
You have a wonderful system being introduced where a lot of people who need that help are going to take advantage of it.
And that means that all of those services that we mentioned before, that requires a lot of people uh, employed in those positions.
You need people for home care, you need people to visit the home.
If you don't have enough human beings to fill those, uh to meet the demand, you're going to have a problem there, because you can have all the money in the world in this fund, but if you don't have anywhere to spend it, then that's going to become a huge issue, And that is why we see that this is used the way it is, that is, to invest the money into the certain kind of facilities and services, and It's kind of like a snowball, isn't it?
You put a little bit of money in and I'm pretty sure most of the facilities are not entirely depending on the money given by the system.
They are also developing, so part of it is supported by the money from the long-term care insurance.
And they would provide service hours to those who would be able to benefit from the system.
But at the same time they can hire more people, they can expand their services and they can sell their service hours to those who need, you know, more hours in the family.
So it's helping the industry develop as well.
And hopefully what we can see is the money not only injecting a bit of impetus to the development of the industry, but also make people see the potential in the aspect.
So more personnel professional health care givers would be able to jump in this new aspect of the workforce.
Yeah, I think we have stats here.
We currently have about 300,000 licensed elderly care workers nationwide.
And we also have a new job, actually, it's called long-term care specialist.
So for those who are interested, you can start to thinking about this kind of job position.
But according to international standard, one caregiver should attend to three to four severely disabled individuals.
And with, for example, 12 million severe disabled people in China, we need at least 3 million caregivers.
And that is the big gap on the industry that we are facing right now.
So it could be a professional career path. for a lot of young peoples out there.
And also thinking about right now, I think official stats having that we have 35 million disabled elderly people in China.
That's 11 of the total elderly population.
So, economic wise we do can have developed more industry based on this kind of a long term care system.
And that's a future that we can look forward to.
