The costs of long-term care provided under the Exceptional Medical Expenses Act (AWBZ) have risen continually in recent years, but revenues fell short. The deficit amounted to 3.3 billion euro in 2011. For the third consecutive year the deficit exceeded 3 billion euro.
Sustained increase AWBZ costs
The costs of long-term care provided under the AWBZ have increased by 38 percent over the past decade from 18 billion euro in 2002 to 25 billion euro in 2011. The costs only dropped marginally in 2008 partly when household care was transferred from the AWBZ in 2007 to the new Social Support Act (WMO), which is carried out by municipalities. Short-term mental health care was also removed from the AWBZ and is currently covered by the Health Care Insurance Act.
In general, the higher prosperity level and the ageing population fuel the soaring costs of health care and also the growing number of chronically ill patients, who live longer lives as a result of advancing medical science.
AWBZ-related costs and revenues
AWBZ contribution rate unchanged since 2008
AWBZ revenues amounted to more than 22 billion euro in 2011, coming from various sources. Obligatory contributions account for two thirds of revenues and nearly a quarter consists of government contributions. Persons who use care facilities pay a personal contribution of 8 percent.
Every person with an income in the Netherlands pays a percentage of their taxable income into the AWBZ scheme. The AWBZ contribution rates were gradually raised in 2003 to cover the huge deficit in 2002: from 10.25 percent in 2002 to 13.45 percent in 2005. The result was a surplus in 2004. Since 2008 the contribution rate is set at 12.15 percent.
AWBZ contribution rate
Revenues no longer cover costs
The AWBZ deficit has occurred since 2007. In 2008, an occasional payment over the tax years 2001 and 2002 had a positive effect on revenues. The balance came close to zero in 2008, but since 2009 the deficit has annually increased again by more than 3 billion euro.
Balance revenues and costs AWBZ