The Institutional Dilemma of Long-Term Care Insurance in Mainland China and Taiwan: A Path Dependence Perspective

In light of the rapidly growing care demand of the ageing population, long-term care insurance has been introduced in welfare states to address the unprecedented social risks. Although it is a new institutional arrangement, the formulation and reform of long-term care insurance are constrained by existing policy paths, significantly limiting its development. For instance, China's long-term care insurance is hindered by the influence of health insurance in areas such as eligibility, funding mechanisms, and provision mechanisms.

This article explores how established institutional paths influence the development of long-term care insurance in Mainland China and Taiwan from the perspective of path dependence, and analyzes the reasons behind this. Firstly, influenced by the productivist welfare capitalism in East Asia, long-term care insurance in both regions still follows the model of Japan and South Korea, serving local economic growth. Secondly, in terms of political structure, factors such as intergovernmental relations and the official promotion system affect the reform process of long-term care insurance in both regions. Finally, institutional costs also lead to the continued reliance on existing paths. Since upfront costs have already been incurred, and the effectiveness and benefits of alternative paths remain uncertain, conservatively sticking to the established path is the prudent choice.