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What are the financial and social challenges posed by an aging population? An extract from LONGEVITY by John Chrysochoos, Ph.D.
There is no doubt on anyone’s mind that elderly individuals, even those in excellent physical and mental health, require much more extensive health care than younger individuals. As the elderly population keeps increasing, if not actually exploding, resources for Medicare and Medicaid, along with Social Security, are becoming scarcer. Such an impact on social and health care programs should not be taken lightly, particularly considering the fact that elderly citizens were about 12 % of the population in United States a decade ago while current predictions, right or wrong, indicate that elderly individuals would reach at least 21 % by 2050.
Unpopular measures may be necessary in order to maintain the solvency of Social Security and Healthcare. As life expectancy keeps increasing, it is not unreasonable or unwise to expect full implementation of such programs a little later, namely, full Social Security and Medicare at 67 years and very gradually at 70 years of age within a decade, while raising gradually the cap for social security contribution. Such changes would not impact current retirees or people within at least 10 years from retirement; they would apply to individuals in their very early fifties or younger who have plenty of time ahead of them to start developing additional retirement vehicles parallel to Social Security and Medicare. Obviously, such restrictions would not apply to individuals on disability or other handicaps who cannot afford and should not have to wait that long.
The benefit of such a delay in retirement would be two-fold. Individuals would keep contributing to retirement programs a little longer through their employment before retirement. In addition, extended activity in their work environment—provided they do not hate it—would maintain, if not improve, their healthy mental shape. Such measures may have some unintended and undesirable consequences upon the employment of younger individuals; their unemployment rates may increase unless the economy and particularly small business improve drastically. Obviously, the politicians’ unrealistic election promises should be ignored.
Although the healthcare system in United States has a lot of critics, the sad truth is that the annual health care cost per capita in USA far outpaces the cost in other industrialized countries. The cost gets skyrocketed as a function of age of the insured individual. Studies have shown that for individuals up to age of 50, the annual medical cost per capita in USA, Germany, UK, Sweden and Spain is nearly the same, about $5,000. However, for individuals at the age of 80, the cost in USA is about $40,000 whereas in the other countries it ranges between $5,000 and $10,000. For elderly at the age of 90, the cost in USA is nearly $45,000 per capita. The increased health care cost in USA is attributed to many more visits to health care providers, necessary or unnecessary, to skyrocketing cost of prescription medicine, and obviously to mismanagement, corruption and fraud associated with several public social programs such as Medicare, Medicaid and other. Incidentally, the full impact of the Affordable Health Care Act has not been fully evaluated, although there are worrisome signs on the horizon of rising premiums and deductibles.
To face such predicted shortfalls one hears more and more calls for the elderly to pay more from their pocket for health care. A recent study has shown that three quarters of households in United States spend at least $10,000 for health care annually, while spending averages are about $36,688 in the last five years of life; it is rather shocking! It should also be emphasized that such outrageous medical costs apply to seniors with common and typical age-related symptoms; not to elderly individuals suffering from serious age-related afflictions such as dementia, Alzheimer’s, serious strokes and nursing homes. In such cases the healthcare cost gets completely out of hand; it bankrupts the families that take care of the elderly or it becomes a burden to society through Medicaid and other social programs.
The octogenarian author, being a retired academic, does not enjoy the benefits of Social Security and consequently Medicare A.; neither does his wife. Their annual premium for Medicare B, medical insurance in lieu of Medicare A, as well as Dental and Vision insurance is about $8,000 at the present, very likely to rise considerably in the near future. Although both the author and his wife are in reasonably good health, their average annual medical expenses, apart from the premium, are at least $8,000 to $10.000.
In an attempt to reduce the cost of Medicare for elderly individuals suffering from three or more ailments, healthcare professionals are considering the possibility of minimizing the number of medications they prescribe to those patients, discussing treatment strategies in detail with their families, trying to integrate medical treatment of such illnesses in order to limit multiple visits to doctor offices and clinics, and trying to avoid several repetitive expensive tests. Obviously, such an approach is much more difficult to implement than it sounds considering the narrow physicians’ specialties and the tendency of pharmaceutical companies to keep prescription medicine protected via the patent law, with no control on the price they charge. It is really shameful that a brand-named prescription drug may cost in the USA several times more than its cost in Canada or overseas, regardless of the research cost involved in the development of such a drug. On top of that, the FDA renders the development of generic drugs more and more difficult through countless restrictions and regulations.
John Chrysochoos, Ph.D.
This article is a very brief extract from the author’s recent nonfiction book titled LONGEVITY (2015).