Thailand Development Research Institute Comment and discussion: Live Long and Prosper: Aging in East Asia and Pacific Worawan Chandoevwit 15 January 2016 1
Outline Elderly: distribution and poverty Pension Health 2
Distribution of population by region % 35 30 25 20 15 10 5 0 Distribution of population in 1990 and 2015 North Northeast Central South Bangkok % 90 80 70 60 50 40 30 20 10 0 Municipality Non-municipality age 40-64 in 1990 age 65+ in 2015 Source: NSO, LFS quarter 3 3
Thailand s poverty by age group is not flat. 35 Poverty headcount (%) % 30 25 20 15 10 5 0 0-24 25-45 46-60 61--70 71-80 81+ Income Poverty (2006) Expenditure Poverty (2006) Income Poverty (2011) Expenditure Poverty (2011) Source: NSO, SES Note: Using TDRI s food and non-food poverty line 4
Rural/Urban Expenditure Poverty (%) % 40.00 35.00 30.00 25.00 20.00 15.00 10.00 5.00 0.00 0-24 25-45 46-60 61-70 71-80 81+ Rural (2006) Urban (2006) Rural (2011) Urban (2011) Source: NSO, SES Note: Using TDRI s food and non-food poverty line 5
Pension Thailand started contributory DB pension in 1998. Eligible contribution period is 15 years which is about the time to reach aged society. 6
Mandatory pension started 1998 1951 1995 2001 1992 1998 1988 1950s 1951 1953 1942 1954 2000 1948 1952 7
Recent pension system development Thailand promoted coordination between social pension and contributory pension design (same direction as recommended in the report). Expected fiscal burden of social pension (elderly cash transfer) will be high. NSF (2011) promotes saving for retirement on voluntary basis. However, registration into the system is still low. 8
Now that we have Workers in the formal sector GPF- DC CS-DB SS-DB Voluntary provident funds DC Social pension Workers in the informal sector and people not in LF. NSF- DC 9
Portability Adequacy Sustainability Policy questions 10
Pension Sustainability Hong Kong Singapore Malaysia South Korea Indonesia Taiwan China India Japan Thailand 0 2 4 6 8 * Scale from 1 10: 10 minor need for reforms, 1 high need for reforms Source: Allianz Asset Management, International Pensions 11
Pension Adequacy Overall ranking Pillar I Pillar II / III Non pension wealth Spending needs Transition from work Japan 5 10 14 25 6 6 South Korea 32 36 27 35 41 2 Taiwan 39 41 25 1 45 28 Singapore 41 45 10 14 48 31 Thailand 43 38 31 38 15 46 China 44 39 43 15 38 15 Hong Kong 45 42 15 47 46 29 Malaysia 47 49 11 42 39 40 India 48 43 34 40 49 27 Indonesia 49 46 47 44 47 30 Note: the numbers refer to overall ranks of (sub-)indicators Source: Allianz International Pensions 2015 12
First pillar: adequacy vs. sustainability Adequacy: Pension System Adequate Moderately adequate Not adequate Sustainability Not sustainable Moderately sustainable Sustainable NZL NL FI N O AT HU LU P T DE ES BR M T FR IT JP C Y S I C H D K US SE LV CA RO B E BG CZ LT S K T R G R U K AU EE H R RU PL KR I E H K SG ID CL MX M Y T W CN IN TH Source: Allianz International Pensions 2015 13
Health Public health utilization by income decile and by age shows that it mildly increases with age. UC patients have to pay out-of-pocket for some treatment. Not everything is free. 14
OP utilization in 2013 1! 0.9! 0.8! 0.7! 0.6! 0.5! 0.4! 0.3! 0.2! 0.1! 0! 0! 0! SS (age 65)! SS (age 45)! 10! 1,400! 20! 2,130! 30! 2,900! 40! 3,600! 50! 4,500! 60! 5,570! UC (age 45)! 70! 7,075! 80! 9,500! UC (age 65)! 90! 13,570! CS (age 65)! CS (age 45)! Income! Percentile! 100! 600,000! Source: Ammar Siamwalla using HWS 2013 15
IP utilization 2013 1.0! 0.9! 0.8! CS! SS! 0.7! 0.6! 0.5! UC (age 45)! UC (age 65)! 0.4! 0.3! 0.2! 0.1! 0.0! 0! 0! 10! 1,400! 20! 2,130! 30! 2,900! 40! 3,600! 50! 4,500! 60! 5,570! 70! 7,075! 80! 9,500! 90! 13,570! 100! Income! 600,000 Percentile!! Source: Ammar Siamwalla using HWS 2013 16
OOP for UC eligible 2013 B/person/visit! 10,000! 1,000! 100! OP! (Log Scale)! Use UC! Don t use UC! 10! 1! 10! 20! 30! 40! 50! 60! 70! 80! 90! 100! Percentile! Source: Ammar Siamwalla using HWS 2013 17
OOP for UC eligible 2013 B/person/episode! 100,000! 10,000! 1,000! 100! 10! IP! (Log Scale)! Don t use UC! Use UC! 1! 10! 20! 30! 40! 50! 60! 70! 80! 90! 100! Percentile! Source: Ammar Siamwalla using HWS 2013 18
HCE in 365 days before date of death 2007-2011 UC CS Die in hospital 64,491 147,445 Die outside hospital 44,590 68,637 Type of Disease Diabetes Mellitus 38,774 60,384 Hypertension 25,233 28,527 Heart disease 47,133 107,896 CVD 43,239 80,752 Cancer 61,243 125,998 19
Trend of Cancer in Thailand, 1995 2009 Source: HITAP 20 3
Policy questions Need more investigation, what is the major cause of HE increase in the future? Is it ageing population or inefficient use of resources or others? Palliative care should be an option for patients at the end of life. LTC will be in high demand. Preparation for workforce and LTC system are rather slow. Need more active health literacy promotion policy to prevent people from NCD which become costly to the health system. 21