Estonia’s care reform improves nursing-home access but leaves home support behind

Estonia’s care reform improved access to nursing homes, but services that help older people live at home did not develop because municipalities lacked funding, an impact analysis reported by ERR has found.

The analysis by the Centre for Applied Research Centar and think tank Praxis examined a reform introduced three years ago to reduce people’s financial burden and improve access to general care services. The state increased funding for municipalities and introduced an additional benefit for people in need with lower incomes.

Financial access to nursing homes improved after the reform. The number of care places reached 12,000 last year, up from 10,000 in 2021, Centar director Epp Kallaste said. But the reform also significantly increased the administrative burden on municipalities: they now have to assess everyone seeking the service, not only people who cannot afford to pay for it.

Prices listed on nursing-home websites are difficult to compare, Kallaste said, because some facilities charge one rate for everyone while others vary prices by room or other factors. The Social Affairs Ministry plans to update its standard for publishing prices so that fees can be compared. The minimum cost of a care place rose by nearly 19 percent after the reform.

Municipalities say a place can usually be found within a few weeks for someone with ordinary care needs if they are willing to be flexible about location. Places are much harder to find for people who need more intensive or specialised care. Social Affairs Ministry policy head Sirli Sõmer-Kull said there was a shortage of places for people with severe or complex dementia and that the ministry was training providers through a dementia competence centre.

The reform did not boost services that support people living at home. Although more people received home care, the average amount of service provided to each person fell. Municipalities used the additional state funding to help pay for residential care, leaving no money for development, Kallaste said.

The analysis recommends developing home care and services that can be provided before residential care becomes necessary, increasing long-term care funding and ensuring people receive advice from municipalities earlier. Sõmer-Kull said home-based and community services could be the focus of a second phase of the reform. Home care currently averages two hours a week, she said, and the situation of family caregivers, including their access to breaks and guarantees, should also be reviewed.

The analysis also found that nursing homes’ labour costs rose after the reform, as did their operating profit margin. The margin increased from 6 percent in 2022 to 15 percent, above the Estonian average.