Future Outlook Longterm Healthcare Costs

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What does the future look like for the industry:

  • Research suggests that if savings rates are not increased and government programs to assist the elderly are not strengthened, many retirees will face serious problems attaining needed health and long-term care services in the future. By 2030, many retirees will not have enough income and assets to cover basic expenditures or any expenses related to a nursing home stay or services from a home health provider.
  • Shorter hospital stays and increased usage of outpatient procedures—changes that have increased the effectiveness of medical care—have shifted responsibility toward unpaid providers of care from paid providers, increasing burdens on family caregivers.

HIPAA Journal weighs in on 2015 healthcare technology trends at (http://www.hipaajournal.com/010-healthcare-technology-trends-2015/).
• The editors see major issues that include implementing new technologies, completing health record conversions to digital formats, and complying with government regulations.
• As do all the other reports, they cite wearable as a significant growth segment.
• The International Classification of Diseases revision, considered another problem area, has been finalized by the HHS.

What are the challenges/struggles the industry faces:

  • Annually 8,357,100 people receive support from the 5 main long-term care service; home health agencies (4,742,500), nursing homes (1,383,700), hospices (1,244,500), residential care communities (713,300) and adult day service centers (273,200).
  • An estimated 12 million Americans needed long-term care in 2007.
  • Most but not all persons in need of long-term care are elderly. Approximately 63% are persons aged 65 and older (6.3 million); the remaining 37% are 64 years of age and younger (3.7 million).
  • The lifetime probability of becoming disabled in at least two activities of daily living or of being cognitively impaired is 68% for people age 65 and older.
  • By 2050, the number of individuals using paid long-term care services in any setting (e.g., at home, residential care such as assisted living, or skilled nursing facilities) will likely double from the 13 million using services in 2000, to 27 million people. This estimate is influenced by growth in the population of older people in need of care.
  • Of the older population with long-term care needs in the community, about 30% (1.5 million persons) have substantial long-term care needs (three or more ADL limitations). Of these, about 25% are 85 and older and 70% report they are in fair to poor health.
  • In 2012, 14.8% of the 65+ population were reported to be below the poverty level.
  • Among the population aged 65+, 69% will develop disabilities before they die, and 35% will eventually enter a nursing home.
  • Nearly a fifth of older people will incur more than $25,000 in lifetime out-of-pocket long-term costs before they die.
  • The prevalence of cognitive impairment among the older population increased over the past decade, while the prevalence of physical impairment remains unchanged.
  • In 2002, the percentage of older persons with moderate or severe memory impairment ranged from about 5% among persons aged 65–69 to about 32% among persons aged 85 or older.
  • Individuals 85 years and older, the oldest old,  are one of the fastest growing segments of the population. In 2012, there are an estimated 5.9 million people 85+ in the United States. This figure is expected to increase to 19.4 million by 2050. This means that there could be an increase from 1.6 million to 6.2 million people age 85 or over with severe or moderate memory impairment in 2050.