Articles of Interest

Health Care Costs and the Elderly

No surprise…Health care costs continue to rise beyond the ‘cost of living’ levels in the United States. Inflation is a fact of life – one that I have always struggled with from a theoretical perspective, but a basis for our reality – especially when it comes to reviewing the cost trends in health care. One demographic hit the hardest by these increasing costs is our elderly population, most significantly those on fixed incomes (i.e., folks collecting and living off of social security). Let’s review where we are with regard to this trend.


In yesterday’s world, some perceived the elderly as frail and dependent, living in nursing homes was considered the norm. Today that is anything but true (although nursing home resident numbers have increased over the years – most likely a result of the general trend of an increasing elder population). There are elder living communities where the residents participate in activities ranging from golf to bingo. Many of our elders still work and provide family support to not only their immediate family, but to their extended family as well. With this increase in “normal” living beyond the years we were once accustomed to (life expectancy is now reaching into the eighties), costs are also increasing due to longer-term living and the continual inflation of health care costs.


In addition, our elderly are also dealing with several disturbing facts:


•  Cardiovascular disease is the leading cause of death in the US, with those 55 and older experiencing the majority of these events

•  As we age (50 years and older) our chances of being diagnosed with cancer double

•  By 2050, the number of people with Alzheimer’s Disease will reach 14 million, and the elder population (65 and over) may reach 82 million people  -- that’s an increase from 12.4% today to nearly 20%


With these facts in mind, policy makers face a never ending struggle to find ways to improve and alter health care for our increasing elder population, all while keeping the costs down. Of course, our policy makers have considered limiting access to expensive drugs and technologies –  which would clearly aid in reducing overall health care costs – however, by reducing such access, the long-term health care costs are most likely going to increase as more and more elders are forced into nursing homes (and the like) at earlier ages.  Also, the incidence of our elders experiencing unhealthy life styles as a result of poorer health care choices due to higher costs will become the new reality.


In the two decades prior to the year 2000, the quality of life for our elderly has improved, as measured by the reduction in severe disabilities which may limit independent functioning (according to Dr. David Cutler of Harvard University in his article, The Reduction in Disability Among the Elderly, Proceedings from the National Academy of Sciences, USA, June 5, 2001.) Dr. Culter calculated this reduction in severe disabilities to have moved from 26.2% to 19.7%, or 1.7% per year. This increase in a healthier elder population correlates to overall lower health care costs.


Yet, the US is doing a poor job at retaining health care costs as we rank 37th in the world in spending on health care, according to the World Health Organization (Council of State Government’s Summation Report, October 2001). While this poor ranking among industrialized countries with socialized health care systems is deplorable, it might be explained by the US need to offer access to newer research in drugs and technology, a practice most other industrialized countries do not do. Yet, at what cost does our higher health care innovation come? What is the mortality rate among the US versus other industrialized countries?


It is clear that there is a high price to pay for innovation – just review any of the published finding on our health care costs. However, with that innovation comes decreased mortality rates. So, is it more important to keep our health care costs down or to save more lives? I opt for saving more lives!


There does seem to be some compromises that we should review, especially in the areas of the tools our policy makers use for making such massive budgetary decisions as evidenced by the recent Health Care Reform bill passage. One of those significant tools is the cost effectiveness of their policies. In other words, is the money spent on new drug research and innovative technology actually accomplishing what it is supposed to? The term “evidence-based” decision making begins to take on new meaning for the tax payers of this country.


By being aware of our costs in health care and by working alongside our policy makers, we should be able to utilize evidence-based tools to have more effective health care management and thus reduce, or at least, control costs. We need to be more outcome-based rather than policy-based, but that takes time and concentrated direction from our voters.


Make a difference in health care by continuing to read and learn and vote!


(For more information see: The Council of State Governments’ Summation Report (CSG), Health Policy Forum, “Medical Innovation and the Aging of America”, by Jenny Sewell and Trudi Matthews, Health Policy Analyst and Chief Health Policy Analyst, respectively, for the CSG)

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