Healthcare for Baby Boomers
When World War II ended in 1945, the returning soldiers came home to America to a new economy, new opportunities, and a new world for them to start a new life. By the end of 1946, millions of them had done just that. They married, got good jobs, bought cars and houses, and had babies. Many babies. Thus began The Baby Boom.
Those babies born between 1946 and 1964 are now collectively called Baby Boomers—all 75 million of them. They are a driving force in our society, our economy, and especially our healthcare system. As they age, they present unprecedented numbers of patients to our medical system, most with multiple diagnoses. As they reach retirement age, they qualify for Medicare at age 65. About 3 million baby boomers will reach retirement age every year for the next 20 years. This will challenge the healthcare system overall through its policies, procedures, delivery methods and economics.
In 2011, there were about 41 million Americans aged 65 and older. By 2020, it is estimated that there will be 71 million Americans in that age group, a 73% increase. As these people retire in the next few years, they will no longer pay into the Medicare system. The age group that does pay into that group—adult Americans of working age— will shrink. In 2011, 13% of Americans were eligible for Medicare. By 2029, this number will be 20%. At the same time, the number of Americans paying into Medicare will drop from 63% in 2011 to 57% by 2029. Most of these Boomers will switch from commercial insurance plans to Medicare. This will determine the success or failure of the new reimbursement models being tested by Medicare, such as patient-centered medical homes and capitated, quality-linked reimbursement.
These numbers are alarming, but they have largely been overshadowed by the recent publicity of the Affordable Care Act as it relates to the population in general, not just Baby Boomers. As the numbers of retiring Boomers continues to increase, it will garner more attention from analysts as well as the media. This issue will only become more pressing as time passes due to sheer increases in numbers.
There are several major differences between the Medicare recipients of the past few generations and the Baby Boomers. First, the Baby Boomers typically present with multiple diagnoses, not just one or two. The top five diagnoses include hypertension (high blood pressure), arthritis, heart disease, cancer and diabetes. Sixty percent have at least one of these diagnoses, and only one in three engages in regular exercise to attempt to offset them. These multiple diagnoses require care from and coordination between specialists as well as the primary care physician, and the system is not currently set up in a way that promotes such collaboration and cooperation. This factor will require attention and a shift in the manner of interactions among specialists towards each other, as well as their relationship with the primary care physician.
The primary care physician is a role that will continue to increase in importance as the focal care provider. However, many medical students are choosing to specialize on one of many fields of specialized care, mostly due to a considerable difference in pay and the ability to maintain more feasible schedules and set their own hours, instead of being on call on a regular basis, as is the primary care physician. This generation recognizes the importance of having more time for themselves and their families, which is hard to maintain as a primary care provider. Thus, more young medical students are choosing to specialize.
Another factor that plays into the multiple diagnosis issue is the fact that with these people with chronic conditions are vulnerable and more likely to end up in the hospital as a result of a fall, a severe cold or an episode of the flu. This is already one of the biggest struggles for Medicare, as the care of the chronically ill patient with multiple diagnoses consumes a significant portion of Medicare funds.
Boomers have a collective wealth that far exceeds any previous generation, and they are not afraid to use it to improve their quality of life. From physical therapy to cosmetic surgery, they are utilizing services in far greater numbers and with far greater frequency than their parents or grandparents did as Medicare recipients. They go to the doctor more, and are willing to spend more on health care. In addition, this group continues to increase their spending on exercise programs such as tennis and yoga, gym memberships and other fitness classes. They also are driving the market up for “superfoods” that tout anti-aging properties and enhanced health.
This wealth, however, is concentrated among those Boomers who lost the least in the economic downturn that began in 2008. It is estimated that the Boomers who were born between 1946 and 1955 lost 28% of their net worth during the Great Recession. They lost their jobs in record numbers, spent down savings, and many have remained unemployed. Their retirement accounts shriveled, which will affect their ability to pay out-of-pocket expenses after they retire. Currently, the out-of-pocket average spent by Medicare recipients annually is $1,450 towards insurance, medical services, medications and supplies.
These findings indicate an increased likelihood for continued rising health care costs and a need for increased numbers of health-care professionals to care for them. The irony in that aspect is that a considerable number of these retiring Boomers are retiring from healthcare professions themselves, leaving gaps that are currently hard to fill, and will likely become harder. By 2020, approximately 5.6 million jobs in the healthcare field will be created to accommodate Boomer’s needs from home healthcare, nursing home care and community care, as well as manufacturing the pharmaceuticals. One of the greatest needs is expected to be in the direct-care field, as the need for nurse aides and home health care workers will increase at a pace consistent with or greater than the need for doctors, nurses, therapists, and other clinicians.
All this publicity may give Baby Boomers a bad name in the medical field, but some suggest they are not to blame. The emergence of costly new drugs, new medical technologies and diagnostics are driving costs up, and Boomers have no choice but to partake. In most sectors of the economy, technology decreases costs, but in healthcare, costs raise with new technology because the demand for the services increases. A prime example is stenting, whereby surgeons insert a mesh tube into a weakened artery for reinforcement. This was originally developed for a small and specific patient population, but now it is widely used. It is important to note also that no matter what the patient’s age, everyone is paying more for health care than a generation ago.
There are aggressive efforts aimed at improving the short-term and long-term health of Medicare in light of the Baby Boom generation aging and reaching Medicare age. Incentives towards prevention of disease and promotion of good health are the most proactive, but are slow to change the ability of humans to increase self-disciple in terms of taking care of one’s own health. The Affordable Care Act is a major force in promoting and testing models that focus on the value of the health care delivered versus the volume. Bundled payments for acute and post-acute care help to stress the value aspect of this plan, as do the creation of community-based organizations designed to assist the patient in the transition from acute to post-acute, whether it is to a nursing facility, assisted living facility, or as a recipient of home health care services.
Baby Boomers have matured along with technology, and most are not afraid to implement it. Thus, their willingness to engage in treatment that involves new technology that, unlike many new forms of technology is actually more economical—such as mobile health care and telemedicine—may ease some of the burden on the healthcare system and Medicare funding.
Longevity continues to increase, with the 85-plus age group growing the fastest. This factor raises an interesting perspective on the situation, as one of the most promising approaches is medical care based on the theory that aging itself causes chronic illness, and the focus should therefore be on the aging process and efforts to offset its effects. As one ages, typically more diagnoses are added to the list. “Health span” is a term that signifies a period of time that a person is relatively healthy. Efforts to increase these spans of time are showing promise.
Clearly, this pressing issue will continue to become more important as the numbers of retiring Baby Boomers continue to increase. Policymakers, analysts and medical researchers recognize the need to keep this issue at the forefront of their agendas. It is a unique and unprecedented problem in our society.