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 “long-term care insurance covers 300 million people”; when outlining tasks for 2026, it explicitly proposes to “promote the implementation of long-term care insurance.”

Industry insiders say, “The term ‘promote’ appears for the first time in the government work report regarding long-term care insurance, marking that this key system to address the challenges of an aging population 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, long-term care insurance will be implemented, the professionalization of elderly care service personnel will be promoted, and the overall supervision and management of elderly care services will be improved.

Long-term care insurance system enters a comprehensive establishment phase

Long-term care insurance (hereinafter referred to as “LTC insurance”) 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 emergence of LTC insurance, it is called the “sixth insurance” of social security.

Since its pilot launch in 2016, the exploration of LTC insurance 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 LTC insurance and removed the word “pilot,” first proposing to “promote the establishment of long-term care insurance.” The 2025 government work report called for “accelerating the establishment of long-term care insurance.”

This year, the government work report further clarified, “promote the implementation of long-term care insurance.” The “15th Five-Year Plan Draft” also emphasizes “promoting the implementation of long-term care insurance” and proposes to advance the professionalization of elderly care service personnel.

Earlier, at the “2025 National Long-term Care Insurance High-Quality Development Conference” 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 “15th Five-Year Plan” period, the LTC insurance system would shift from pilot to full implementation.

With the increasing efforts to advance the system, the insured population for LTC insurance is also rapidly expanding. According to the “2023 National Medical Security Development Statistical Bulletin,” in 2023, 1.8 billion people in 49 pilot cities participated in LTC insurance. This year’s government work report shows that by 2025, the coverage of LTC insurance has quickly increased to 300 million people.

Behind this data is the continuous deepening of China’s aging population and the significant growth 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 LTC insurance

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

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

He recommended that the Standing Committee of the National People’s Congress include LTC insurance 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. He suggested establishing LTC insurance as an independent social insurance category alongside pension and medical insurance, to enhance the system’s authority and stability.

In the development of LTC insurance, commercial insurance companies play an indispensable role. Data shows that currently, LTC insurance covers over 80 cities nationwide, benefiting nearly 300 million people, with annual fund expenditures around one billion yuan, forming a mainstream “risk-sharing” model of social-commercial 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 systems and mechanisms. For example, current commercial insurers handling LTC insurance need to bear an additional approximately 0.8% of the insurance guarantee fund and 0.06% of regulatory fees.

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

She proposed three specific measures: first, reduce policy-related costs to ensure the implementation of the cost-profit principle. Implement tax reductions, administrative and institutional fee waivers, and insurance guarantee fund reductions for insurers handling LTC insurance, lowering operational costs.

Second, establish a dedicated management mechanism similar to critical 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 LTC insurance, continuously improving the model of government supervision, commercial contracting, and social participation, leveraging the professional advantages of commercial insurers, and undertaking more management services to achieve efficient operation with clear separation of governance and administration.

Talent shortages need to be addressed

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-standing problem of a shortage of high-quality, professional elderly care personnel.

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

The “China Home-based Elderly Care Service Worker Career Development Report (2025)” jointly released by the 21st Century Economic Report and Ping An Life further points out that currently, China has only 1.338 million elderly care workers, with 597,000 working in elderly care institutions and 741,000 in community elderly care facilities. According to the international standard of “one professional caregiver per three disabled elderly,” China needs over 10 million caregivers for disabled seniors alone, but the current workforce 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 LTC insurance. The elderly care workforce generally faces issues such as aging, insufficient skills, and high mobility. He suggested 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 LTC insurance 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 clients with 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 relies on its “comprehensive finance + medical and elderly care” strategy to build a full-chain elderly care service team, implementing a “selection—training—protection” system. 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 has covered 100 cities nationwide, expanding to 25 cities in 2025 alone, with an 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 suggested establishing a comprehensive long-term care insurance 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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