The Impact of the Great Recession on Long-Term Services and Supports in the United States and England

Abstract

The Great Recession substantially affected most developed countries. How countries responded to the Great Recession varied greatly, especially in terms of public spending. We examine the impact of the Great Recession on long-term services and supports (LTSS) in the United States and England. Financing for LTSS in these two countries differs in important ways; by examining the two countries’ financing and program structures, we learn how these factors influenced each country’s response to this common external stimulus. We find that between 2006 and 2013, LTSS increased in the United States in terms of spending (17%) and number of people served; in contrast, over the same period, LTSS in England decreased in terms of spending (6%) and people served. We find that the use of earmarked LTSS funding in the United States, compared to non-earmarked funding in England, contributed to different trajectories for LTSS in the two countries. Other contributing factors included differences in service entitlements, variations in ability of state and local governments to tax, and larger macroeconomic strategies implemented to combat the recession. We analyze the implications of our findings, especially as related to the potential shift to Medicaid block grant LTSS funding in the United States.