Estonian demographics are characterised by an ageing population, a high emigration rate, and a low life expectancy, with a large difference between men and women, compared to Western Europe.
In the period 2019-2050 the share of 65+ people in the Estonian population is expected to grow from 19.8% to 28.5% (EU-28: 20%-28.5%), with most of the growth happening before 2035. At the same time the share of people 85+ will expand by more than a factor of 2 from 2.5% to 5.8% (EU-28: 2.7%-6.1%).
Over the same period, the old age dependency ratio measured as 65+ as percentage of the 15-64-year olds will rise from 30.6% (EU-28: 30.5%) to 61.1% (EU-28: 55.3%).
Life expectancy for men and women at age 65 is projected to rise from 15.6/20.8 years (EU-28: 18.1/21.4) in 2018 to 20.9/24.9 years (EU-28: 22.4/25.6) in 2060. From 2013 to 2017 healthy life expectancy for men and women rose by 0.6 and 0.4 years, respectively.
Under an assumption of no policy change the Ageing Report scenario suggests that public expenditure as share of GDP would rise from 0.9% to 1.4% (EU-27: 1.6%-3.1%) by 2070. The impact of a progressive shift from the informal to the formal sector of care in Estonia would entail an estimated increase by 84% in the share of GDP devoted to public expenditure on long-term care (128% on average for the EU27).
The main challenges related to long-term care (LTC) in Estonia relate to access, adequacy and quality; working conditions; and financial sustainability. The organisation of LTC is split between two systems – the local and the state system. Local government is responsible for organising local welfare services and benefits, while the state is responsible for organising state level benefits, rehabilitation services and special care services for people with special mental needs.
In terms of financing, fragmentation arises from the separation of funding streams between the state and local government. Long-term health care services, such as residential and home-based nursing care, are financed at the state level by the Estonian Health Insurance Fund (EHIF). In turn, long-term social care services, such as help with daily activities in the home or in social welfare institutions, are financed primarily through local government taxes with limited equalisation payments from the state for lower-income municipalities. Other social care services such as special care services and childcare services are financed directly by the state.
Health and social LTC services are also organisationally and professionally fragmented between two separate systems, each with their own culture and modus operandi. The fragmentation between health and social care is multidimensional and concerns the financial, organisational, professional and policy levels. It translated across care episodes, providers, settings and services and often results in inefficiencies in the provision of long-term care.
The lack of uniform guidelines and precise criteria for local government social services, fragmented and uncoordinated service provision and insufficient funding have led to inequalities in treatment for people with similar needs. The bases and amount of care allowance, the package of services provided, and the circle of service recipients differ across the country. Due to the uneven development of regions, the economic capacity of local governments differs, as it depends on how much, what services and for whom they can finance. Insufficient funding for services has also been caused by policy choices made at the local government level, where social welfare is not prioritised.
Benefits in cash and in kind are granted to all residents in Estonia. Cash benefits are provided either by the state or the municipalities, while in-kind benefits are provided by municipalities only. Social welfare services are also organised at municipal level. The municipality may provide social welfare services by itself or purchase the services from a third party. The form of ownership among service providers is irrelevant, but the service provided must meet a set of established requirements.
In order to improve efficiency, municipalities increasingly cooperate to jointly provide better services. As there are many small municipalities in Estonia, it is not always financially feasible for them to offer services independently.
LTC services are mostly co-financed by local budgets and beneficiaries themselves. In some cases, cash benefits can be provided by the state budget. However, geriatric assessment and nursing care are mostly covered by the EHIF. Either way, due to limited budgets, LTC services are under significant financial strain, which partly explains the inadequacy of facilities, the lack of trained personnel and the shortage of suitable and sustainable financing.
The Estonian law regulates family obligations with regard to permanent care services. Community care is provided by the state or with a symbolic cost sharing. For example, 50.3% of the cost of 24-hour care was covered by the customer or their families, and 47.6% by local governments.
Cash benefits account for the biggest share (0.33%) of the current LTC expenditure, followed by institutional care (0.19%).
The level of LTC needs is assessed by both a doctor (GP or specialist) according to Healthcare Services Act and by a local social worker under the Social Welfare Act. The doctor’s role is to evaluate the health status and the need for personal assistance, guidance or supervision while the social worker focuses on the needs and wishes of the care recipient and their family.
Each municipality is responsible for ensuring the quality of care services and monitoring the care system (care services, benefits, etc.). Municipalities also process the complaints of service users. Quality standards are defined by the Ministry of Social Affairs.
Accessibility to services is uneven and often limited in different part of Estonia. This is mainly due to the fact that the welfare and healthcare systems are financed from different sources – from the state budget and through the EHIF. Many social care home residents also need LTC, but the amount of LTC provided in social care homes is constrained by limited local budget resources.
A comprehensive long-term care concept together with proposals for renewing the state-local government financing model was approved by Cabinet of Ministers on 30 January 2020. The organisation of LTC care services will be done in state-local government partnership. The state will take more responsibility to develop and provide those LTC services, which are not reasonable to develop and provide on local level. The aim of establishing an integrated LTC system is to reduce the care burden and ensure the cross-sectoral provision, availability and quality of human and family-oriented services. The preparation and implementation of the changes will involve partners to provide solutions for the integration of different systems, create a sustainable and cost-effective financing system for the LTC system and develop a legal framework to regulate LTC between the health and social care sectors and responsibilities between the state and local government.
The legislation regulating the care reform is expected to enter into force on July 1, 2023. The care reform is seen as one of the biggest, most necessary reforms in the social field in Estonia of the last decades.
Number of carers
Informal carers bear a disproportionate care burden. According to some estimates in Estonia, approximately 35,100 women and 24,500 men have an obligation to provide assistance or care to a family member, both in terms of care as well as on paying for care services. Due to the care burden, people tend to drop out from the labour market (according to Labour Force Survey database 8000 people are not economically active and 5000 are working part-time) or provide care in addition to fulltime work. Caregiver burden and strain can also contribute to the caregiver’s own poor health.
This situation does not guarantee the human dignity of carers and dependants and, in addition, imposes indirect costs on the state – loss of tax revenue, additional burden on the health care system, financial support for people’s livelihoods.
Approximately 0.4% of persons under the age of 65 and 2% of the people over 65 are in care institutions. About 0.1% of persons aged below 65 and 2.2% of persons older than 65 years receive home help. In the absence of adequate publicly financed coverage, the burden of care falls disproportionately on informal carers, giving rise to significant economic and social costs. The reliance on informal care is underpinned by the Constitution of the Republic of Estonia (Art. 27), which stipulates that the family is required to provide care for its members in need.
Official information on the number of informal carers in Estonia is very limited. The Estonian Labour Force survey provides information on the share of inactivity due to taking care of children or other members of the family, but it is not possible to derive the reasons for care from these datasets. According to the European Quality of Life Survey (2016) though, at least 100,000 people provide informal care on a regular basis (12% of the working age population, 7,7% of the Estonian population).
The reliance on informal care exacerbates socioeconomic inequalities amongst those in need because carer support, like other types of social care discussed here, is allocated at the discretion of local government.
Social inclusion of carers, access to education and employment:
Unsurprisingly, informal care responsibilities restrain informal carers’ (especially women’s) ability to participate actively in the labour market and has an impact on their financial resources. A conservative estimate of the opportunity cost relating to time spent caring in Estonia amounted to €23.9 million in 2015 (confidence interval of 16.0-31.7 million) or about 0.12% of GDP. Besides the economic costs, informal carer responsibility entails social costs associated with the psycho-social impact of providing care to sick, disabled family members.
Carer’s allowance: Financial support to carers is very limited. Carers can receive a carer’s allowance (hooldajatoetus), paid by local authorities and can benefit from short-term health insurance care benefits (hooldushüvitis), paid by the Estonian Health Insurance Fund following a temporary incapacity for work.
The carer’s allowance is a cash contribution provided by local authorities to carers who support people with an assessed degree of limitation with instrumental activities of daily living (e.g. paying bills, organizing transportation to a doctor or to a bank when needed) and who also provide care services at home (personal assistance in eating, clothing, washing; home assistance in cleaning, cooking, buying products). The conditions of access as well as the amount of the allowance are regulated by local authorities and may therefore vary. The main condition is that the carer needs to be appointed by the local authority. The total spending on carer’s allowance per capita (used here as a proxy for the level of spending) varied from €0.86 in Saare county to €9.86 in Vôru county. In 49 municipalities and cities, there were in each case fewer than 10 beneficiaries of carer’s allowance.
According to the Ministry of Social Affairs, the average carer’s allowance was €51 for a child and €25 for an adult per month in 2015. The range of minimum and maximum amounts was from €15 to €121 when caring for children and from €15 to €53 when caring for adults in 2014. On average, in 2015, annual carer’s benefit was €304 per beneficiary (ranging, according to locality and the physical and mental status of the dependent person, between €5 and €100 per month). These disparities indicate that there are no minimum standards in provision of the benefit, which is allocated at the discretion of local government on an ad hoc basis. For those carers who neither work nor receive national pensions, local authorities pay the minimum level of social tax that guarantees carers’ health insurance, and the minimum required contributions to the state pension scheme. Some municipalities allow carers to work at the same time, some do not. The Carer’s allowance is not subject to taxation.
Carer’s leave: Paid care leave is only available on a short-term basis. The Care benefit (hooldushüvitis) is a temporary benefit for work incapacity, which is regulated by the Health Insurance Act and paid by the Estonian Health Insurance Fund (EHIF) to people who have a temporary disruption in employment because of caring needs.
The Care benefit is paid to an insured person in cases of:
- Caring for a child of under 12 years of age;
- Caring for a family member who is ill at home;
- Caring for a child under 3 years of age or for a disabled child under 16, where the carer is her/himself ill or receiving obstetrical care.
The duration of the benefit is up to 14 calendar days in the event of nursing a child of under 12 years of age, or up to 7 calendar days in the event of nursing another family member at home.
The benefit is paid for up to 60 calendar days if a child under 12 years is sick due to a malignant tumour and the treatment starts in the hospital (since 2015).
The benefit is paid for up to 10 calendar days in the event of caring for a child under three years of age, or for a disabled child under 16 years of age, if the regular carer of the child is ill or receiving obstetrical care.
The benefit is paid by the Estonian Health Insurance Fund from the first day of exemption from work, and is 80% of the previous labour income. There is no ceiling for the benefit. The care benefit cannot be cumulated with labour earnings.
In addition to paid short-term leave, there are additional leaves available to parents of disabled children. A parent of a disabled child has the right to have one day of leave per month until the child reaches the age of 18. That day will be remunerated according to the parent’s average earnings. The employer is compensated from the state budget by the Estonian National Social Insurance Fund. (This day of leave is on top of the 3 days per year, remunerated with minimum wage, if a parent has a child under 14.) In addition, every parent who raises a child under 14 years or a disabled child under 18 has a right to receive 10 days of unpaid vacation each year.
- The 2021 Long-Term Care Report, Trends, challenges and opportunities in an ageing society, EC 2021
- The 2018 Ageing Report, Economic and Budgetary Projections for the EU Member States (2016-2070), EC, 2018
- ESPN Thematic Report on Challenges in long-term care – Estonia, EC, 2018
- ESPN Thematic Report on work–life balance measures for persons of working age with dependent relatives, Estonia, 2016
- Joint Report on Health Care and Long-Term Care Systems and Fiscal Sustainability, EC, 2016
- Adequate social protection for long-term care needs in an ageing society, European Commission, 2014
Last Updated on March 2, 2023