Social Security's "Sixth Insurance" has arrived!

Southern Finance All Media Reporter Lin Hanyi

The deployment of social security system construction in the 2026 government work report has attracted attention. The report, reviewing 2025 work, states that “the long-term care insurance system covers 300 million people”; in outlining the 2026 tasks, it explicitly proposes to “promote the implementation of the long-term care insurance system.”

Industry insiders say, “promote” appearing for the first time in the government work report regarding the long-term care insurance system marks that this key system for addressing the aging population challenge will move from pilot exploration into a new stage of full implementation and deepening development.

The “Outline of the 15th Five-Year Plan for National Economic and Social Development of the People’s Republic of China” (hereinafter referred to as the “15th Five-Year Plan Draft”) once again clarifies that during the “15th Five-Year Plan” period, the long-term care insurance will be implemented, the professionalization of elderly care service personnel will be promoted, and the overall supervision and quality of elderly care services will be improved.

The Long-term Care Insurance System Enters a Fully Established Stage

Long-term care insurance (hereinafter referred to as “LTCI”) aims to solve the care difficulties of the long-term disabled population—individuals who are unable to care for themselves due to old age, illness, or disability—allowing the disabled to “remain cared for despite losing ability.” It mainly provides funding or service guarantees for basic daily care and medical care closely related to daily life for long-term disabled individuals.

Currently, China’s basic social insurance mainly includes the “Five Insurances” such as basic pension insurance; after the introduction of LTCI, it is called the “Sixth Social Insurance.”

Since its pilot launch in 2016, the exploration of LTCI has lasted nearly a decade and has increasingly attracted policy attention.

From 2021 to 2023, government work reports have mentioned “steadily advancing the pilot of long-term care insurance” for three consecutive years. In 2024, the report continued to mention LTCI, removing the word “pilot” for the first time and explicitly proposing to “promote the establishment of LTCI.” The 2025 government work report called for “accelerating the establishment of LTCI.”

This year, the government work report further clarified, “promote the implementation of LTCI.” The “14th Five-Year Plan” draft also emphasizes “promoting the implementation of LTCI” and proposes to advance the professionalization of elderly care service personnel.

Earlier, at the “2025 National Conference on High-Quality Development of Long-term Care Insurance” at the end of 2025, Zhang Ke, Secretary of the Party Leadership Group and Director of the National Healthcare Security Administration, explicitly stated that during the “14th Five-Year Plan” period, the LTCI system would shift from pilot to full establishment.

With the increasing efforts to advance the system, the insured population for LTCI is also rapidly expanding. According to the “2023 National Medical Security Development Statistical Bulletin,” in 2023, 180 million people in 49 pilot cities participated in LTCI. The government work report this year shows that by 2025, the coverage of LTCI has quickly increased to 300 million people.

Behind this data is the continuous deepening of China’s aging population and a significant increase in market demand for care for the disabled.

According to the National Bureau of Statistics, by the end of 2025, China’s population aged 60 and above reached 323 million, accounting for 23% of the total population; at the same time, data from the National Health Commission shows that by the end of 2023, there were 45 million disabled and demented elderly nationwide.

Calls for Legislation and Policy Reductions for LTCI

Faced with the urgent care needs of over 45 million disabled and demented elderly, many representatives and committee members have proposed suggestions during the two sessions for standardized operation of LTCI.

阎建国, a deputy to the National People’s Congress and chief partner of Beijing Xinli Law Firm, pointed out that “the core bottleneck in the current promotion of LTCI in China is the lack of legislation, inconsistent standards, and unbalanced progress.”

He recommends that the Standing Committee of the National People’s Congress include LTCI legislation in the annual legislative plan, accelerate legislative progress, and promptly formulate a Long-term Care Insurance Law to clarify its legal positioning, basic principles, scope of application, and management system. LTCI should be established as an independent social insurance category alongside pension and medical insurance, effectively enhancing the system’s authority and stability.

In the construction of LTCI systems, commercial insurance companies play an indispensable role. Data shows that currently, LTCI coverage extends to over 80 cities nationwide, benefiting nearly 300 million people, with annual fund expenditures around one billion yuan, forming a mainstream “risk-sharing” model of public-private cooperation, effectively alleviating the dual economic and care pressures on disabled families.

However, in practice, commercial insurers face issues such as insufficient operational sustainability, inadequate implementation of the cost-profit principle, and imperfect institutional mechanisms. For example, current commercial insurers handling LTCI need to bear an additional approximately 0.8% of the insurance guarantee fund and 0.06% of regulatory costs.

Therefore, Zhou Yanfang, director of the ESG Office at China Pacific Insurance and a deputy to the National People’s Congress, suggests drawing on the mature experience of urban and rural residents’ major illness insurance to improve operational mechanisms and strengthen policy support, promoting high-quality development of policy-based LTCI by commercial insurers.

She proposes three specific measures: First, reduce policy-related costs and implement the cost-profit principle. Provide tax reductions, administrative and institutional fee exemptions, and insurance guarantee fund reductions for insurers handling LTCI, lowering operational costs.

Second, establish a dedicated management mechanism similar to that of major illness insurance, with independent accounting, assessment, and supervision, ensuring strict separation between policy-based and commercial insurance operations.

Third, deepen government-society collaboration in handling LTCI, continuously improving the model of government supervision, commercial contracting, and social participation, leveraging the professional advantages of insurance companies, and undertaking more management services to achieve efficient operation and separation of regulation and administration.

Talent Shortages Need Addressing

The implementation of the system depends on professional service personnel. On the service side, there is a shortage of professional caregiving supply, especially for dementia care, which has become a bottleneck limiting the system’s effectiveness. Additionally, the industry faces a long-term shortage of high-quality, professional elderly care personnel.

The “2025 Elderly Care Worker Occupational Status Survey Report” predicts that over the next five years, the dependent elderly population will increase to more than 40 million, with a care worker gap exceeding 5 million, highlighting a significant supply-demand imbalance—“money can’t buy services” will become an increasingly prominent issue.

The China Daily and Ping An Life jointly released the “China Home Elderly Care Service Worker Career Development Report (2025),” which further points out that China’s total elderly care workforce is only 1.338 million, with 597,000 working in elderly care institutions and 741,000 in community elderly care services. According to the international standard of “one professional caregiver per three disabled elderly,” China needs over 10 million caregivers for disabled seniors alone, but current staffing is less than one-tenth of that demand, creating a severe supply-demand contradiction.

Member of the National Committee of the Chinese People’s Political Consultative Conference and Vice President of Southern University of Science and Technology Jin Li pointed out that the shortage of caregiving talent is the biggest bottleneck for LTCI. The elderly care workforce generally faces issues such as aging, insufficient skills, and high mobility. He suggests policy guidance to encourage insurance and elderly care institutions to participate in talent training, establish special allowances, and improve career advancement channels.

In response to the urgent care needs of over 45 million disabled and demented elderly, commercial insurance institutions are not only important operators of LTCI funds but also play a key role in filling service gaps and cultivating professional talent.

For example, Taikang Insurance has launched the “Happiness Appointment” insurance plan, which pre-funds and plans for future long-term care costs, combined with the professional services of health wealth planners (HWP) under the new life insurance model, providing comprehensive solutions covering elderly care funds and services. On the service side, Taikang’s “Youth Elderly” team at Taikang Home Elderly Community has an average age of only 32, with 75% holding college degrees or higher. Additionally, through the Beijing Taikang Yicai Public Welfare Foundation’s “Yicai Elderly Care” public welfare project, high-quality elderly care talents are being cultivated with strong public support.

China Ping An, relying on its “comprehensive finance + medical and elderly care” strategy, has built a full-chain “selection—training—protection” system for elderly care service professionals. It also launched the “Ping An Butler” home elderly care brand, creating a “3+N” service system centered on “medical health, safety, and care,” integrating diverse resources to meet the varied needs of the elderly, enabling “aging at home.” As of now, the “Ping An Butler” service covers 100 cities nationwide, expanding to 25 cities in 2025 alone, with a growth rate exceeding 33%.

To address the care gap in the era of longevity, Zhang Gongcheng, member of the Standing Committee of the National People’s Congress and president of the China Social Security Association, also suggests establishing a comprehensive LTCI system with an annual investment of 500 billion yuan in the care insurance fund, which can not only solve the worries of disabled elderly but also attract more talents into the industry.

(Edited by: Qian Xiaorui)

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