Impacts of an Aging Demographic on Healthcare

2030 is poised to be an interesting year in the United States. As life expectancy continues to tick upward, rising from less than 70 years old in 1968 to almost 80 years old today, the U.S. Census Bureau confirms that in 2030, one out of every five Americans will reach retirement age.¹ In fact, the number of Americans over age 65 years is expected to double from roughly 50 million today to nearly 100 million by 2060. As we collectively age, these shifting demographics are poised to put undue pressure on an already challenged national healthcare system.² And, while the U.S. is currently ranked among the top countries in the world for the elderly, there are significant disparities across the country when it comes to healthcare access and quality of life.  “The aging of baby boomers means that within just a couple of decades, older people are projected to outnumber children for the first time in U.S. history,” said Jonathan Vespa, a demographer with the U.S. Census Bureau. “By 2035, there will be 78 million people 65 years and older compared to 76.7 million under the age of 18 (Figure 1).”³

This seismic demographic shift will impact everything from the availability of elder and long-term care to Social Security and public health services. According to Census Bureau projections:²

• The old-age dependency ratio (the ratio of older adults to working-age adults) will also shift. In 2020, there were 3.5 working-age adults for every retirement-age person, but by 2060, that ratio will drop to just 2.5.

• The U.S. home care market is expected to grow from $100 billion to $225 billion by 2024, driven by an expanding geriatric population. 

The bottom line? There will be far more demand for healthcare, likely exceeding supply and taxing industries already struggling with a shortage of qualified caregivers. A study conducted by Mercer healthcare staffing agency predicts U.S. providers will face a collective shortage of approximately 500,000 home health aides, 100,000 nursing assistants and 29,000 nurse practitioners by the year 2025.⁴ “Few other industries are racing the clock to find a future-ready workforce like today’s healthcare administrators,” said Jason Narlock, senior consultant at Mercer.

Healthcare Tech Trends for an Aging Population

Despite these dire predictions, the future healthcare prospects of an aging population are not all doom and gloom. Digital technology and trends within healthcare have already made tremendous strides, especially on the heels of the COVID-19 pandemic. By all accounts, digital tools, platforms and resources are expected to become more prevalent in the coming years — with the potential to help minimize healthcare costs, especially among older adults.

One of the factors positively influencing the use of technology to support healthcare demand is that the aging U.S. population is largely comprised of tech-savvy baby boomers. From online Google symptom searches to telehealth appointments, 78 percent of this demographic is actively using technology to access medical resources and information.⁵

Boomers are also highly likely to own and use smartphones and download and use apps. A 2019 Rock Health Consumer Adoption survey noted that smartphone and app use among people 55 years old to 65 years old is near that of their younger counterparts (generally within 10 percent).⁶

Technology may also help drive home healthcare costs down. According to the American Association of Retired Persons, 87 percent of adults age 65 and older want to stay in their current home and community as they age, a massive financial benefit compared to the cost of an assisted living facility or nursing home care. Thanks to telehealth technology that allows medical professionals to monitor patients outside of traditional clinical settings, many older adults can get the monitored care they need from the comfort and familiarity of their homes. 

In a collaboration between Senior Whole Health of Massachusetts and Best Buy subsidiary GreatCall, a provider of smartphones and tech geared toward seniors, a new app called Care Team can monitor and support senior patients through GreatCall’s Lively Home monitoring system. The system uses sensors to monitor daily activities — food intake, sleep patterns, physical activity, mobility — and apply predictive analytics to identify behavior trends and flag anomalies. A pilot study indicates that utilizing this kind of “passive monitoring” for proactive intervention can help trim healthcare costs by reducing the rate of unnecessary hospitalizations, while also helping seniors remain independent longer.⁷

Based on current doctor-to-patient ratios, the projected shortage in hospice and palliative medicine specialists could range from 10,640 to almost 24,000 by 2040, according to a report published in the Journal of Pain and Symptom Management.⁸ Another innovative technology that supports the need for home care and hospice services has been developed by Intermountain Health Care. Named Intermountain at Home, the platform integrates remote monitoring and access to round-the-clock virtual urgent care and doctor appointments. By utilizing telemedicine with home care visits, it bridges potential shortages in palliative care.⁹

Finally, as of 2020, Medicare Advantage plans began including telemedicine within the standard benefits package, expanding access to telehealth services so patients can connect with their doctors by phone or video chat, regardless of where they live.¹⁰

Facing the Challenge of Chronic Disease

According to a World Health Organization report, as life expectancy increases, the prevalence of disability will decrease thanks to numerous medical advances that have slowed disease progression. As a result, there will be a decrease in severe disability, but increased instances of chronic diseases and the resulting healthcare costs that go with them. 

With an aging population, certain health conditions are statistically expected to increase as well, a prospect that will challenge the healthcare system based on the sheer volume of potential patients. Some of the diagnoses expected to increase include:¹¹  

• Cancer: The number of cancer cases is expected to surpass 27 million by 2030.

• Dementia: Alzheimer’s Disease International projects there will be 115 million individuals living with Alzheimer’s disease/dementia in the world by 2050. 

• Obesity: Not only is obesity a risk factor for many health conditions, but it is very costly. Patients who are obese cost Medicare approximately 34 percent more compared with patients of normal weight.

• Diabetes: The number of Americans with diabetes is expected to rise from 30 million today to 46 million by 2030, with one of every four boomers living with this chronic disease.

• Fall-related injuries: According to a report released by the American Hospital Association, more than one-third of adults 65 or older fall each year. Of those who fall, 30 percent suffer moderate to severe injuries (such as hip fractures) that decrease mobility and independence.

In the face of these concerns, specific challenges to the healthcare system include a shortage of healthcare professionals to meet the growing demands; the sustainability and structure of federal programs in relation to the increasing aging population; changing family structures possibly leading to fewer family caregivers; and ongoing adjustments needed to navigate the nuances of the Affordable Care Act.

Of course, the future economic demands on healthcare are not only driven by the baby boomer generation. As millennials begin turning 40 in 2021, they are proving to present a number of healthcare challenges. A Blue Cross Blue Shield (BCBS) report on the health of millennials indicates this population is less healthy than the previous Generation X and will likely contribute to greater demand for treatment and even higher healthcare costs in the years ahead.¹²

Millennials, most commonly defined as those born between 1981 and 1997, are the largest generation in the U.S. labor force — surpassing both baby boomers and Generation X — and still growing. The BCBS report findings indicate older millennials have higher prevalence rates for nearly all the top 10 health conditions than Gen X members when they were the same age. These conditions include depression, hypertension, high cholesterol and type II diabetes. Increases in substance abuse disorders, psychotic disorders and other behavioral health conditions within this population will also increase demand for behavioral health providers. The findings in the report highlight the need to consider how the evolving needs of millennials impact overall healthcare utilization — a demographic that historically was not a large driver of overall healthcare demand.¹² “There’s no question that some emerging evidence shows many millennials are unhealthier than predicted,” says Georges Benjamin, MD, executive director of the American Public Health Association. “Hypertension, diabetes and obesity drives a lot of that,” Dr. Benjamin says, adding that the obesity epidemic may be one of the root causes of the rise in rates of hypertension, diabetes and even certain types of cancer.¹³

In part, the declining health of millennials may be due to their collective aversion to preventive care. Another study found two-thirds of millennials only see a doctor when they are sick, and 68 percent don’t have a primary care physician because they don’t think they need one. Instead, they seek care only when a major problem develops. Without intervention to prevent or best manage the severity of disease, mortality rates could rise more than 40 percent compared to the previous generation at the same age.¹⁴

Counting the Cost of Care

While living healthier and longer is certainly everyone’s goal, longer lifespans coupled with increased costs of living have skyrocketed end-of-life care, putting a very real strain on government resources and patient bank accounts.

In collaboration with Genworth Financial, a 2018 Washington Post report¹⁵ estimates the annual median cost of a private nursing home room at $100,375, with the cost of an at-home health aide service averaging $50,336 a year. For many seniors and their families, the costs of long-term care are simply out of reach.

That leaves taxpayer-funded programs and government services to absorb the cost of long-term care. Medicaid covers long-term care needs, but typically only for seniors with limited financial resources and only for certain types of care facilities. That means for many seniors, a continuing-care community won’t be a viable option, and traditional nursing homes that accept a limited number of Medicaid patients may be their only alternative.

One way to get ahead of these concerns is by putting renewed focus on preventive medicine. Many healthcare organizations proactively promote preventive services to improve patient health outcomes for older adults, with the goal of extending the ability of seniors to live independently and cut down on costly repeat hospital stays and long-term care. 

Healthcare startup Landmark Health has created an in-home, risked-based medical group focused on the chronically ill and elderly population. The Huntington Beach, Calif.-based company boasts about 150,000 patients annually, and continues to expand its reach.¹⁶ The company’s healthcare model features a team of physicians who go into patients’ homes and includes an interdisciplinary team of social workers, dietitians and pharmacists to meet patients’ unique needs. The model allows physicians to see fewer patients so they are able to spend more time with each while developing their care plans. It also provides door-to-door transportation and virtual visits, hoping to reduce hospitalizations by getting patients access to care before an adverse health event. 

Similarly structured Oak Street Health is a network of value-based primary care centers for adults on Medicare that recently announced the opening of its 100th center. The company serves nearly 110,000 patients across 15 states. With a mission of rebuilding healthcare, Oaktree’s innovative model focuses on quality of care over volume of services and assumes the full financial risk of its patients. The company’s primary care providers specialize in caring for Medicare patients and seniors with an emphasis on preventive care that strives to keep seniors healthy and out of the hospital. “We are more committed than ever to bringing our innovative care model and unmatched patient experience to more communities and improving health outcomes for our patients,” said Mike Pykosz, chief executive officer.¹⁷

Is There a Silver Lining?

What has been dubbed the graying of America has put a spotlight on the need for more conversation and collaboration between all stakeholders in the healthcare industry and Washington D.C.-based policymakers. To address the tsunami of concerns, players in every field will need to work together to solve the coming challenges. Embracing technology, funding innovation and addressing access to care issues are imperative. By working together, the healthcare system — and the patients it supports — can age more gracefully and meet future demands.