Before the Boom
The
beginning of a new year is a good time to look forward. Donald Redfoot,
Ph.D. and Sheel Pandya, MPH have done that in Before the Boom a publication
of the AARP Public Policy Institute. The authors take a look at how
our country has "aged" and identify 14 trends that will shape
the future. The results are surprising, enlightening and encouraging.
Following are excerpts from Before the Boom.
Like other Western industrialized societies,
the United States has experienced unprecedented growth in the older
population over the past few decades. Growth in the older population
during the coming decades will far surpass all past experience. Addressing
the future needs of the Baby Boom cohorts born between 1946 and 1965
is increasingly a subject of national debate. At times the debate is
characterized by almost apocalyptic estimates of the potential costs
of meeting their long-term supportive services needs, even though the
oldest Boomers are only 56-years-old and are unlikely to need such services
in large numbers for another 20 years or more and will not crest until
after 2030. The cohorts reaching old age in the meantime will be relatively
small, and they are likely to be healthier and wealthier than previous
cohorts — characteristics that are likely to promote a more consumer-oriented
system of delivering long-term supportive services.
Trend #1 - Nursing home utilization
rates have declined substantially, especially among persons 75 years
of age and older.
In age-standardized terms, nursing home utilization has declined by
one-fourth since 1973. If utilization had remained at 1973 levels, the
number of older persons in nursing homes in 1999 would have been more
than half a million higher than the actual number of 1.4 million.
Trend #2 - Growth in the older population,
which was heavily skewed toward the 75 and older age categories in the
last decade, will shift to the younger old in the next two decades.
More than 90 percent of the growth in the older population during the
1990s was among those 75 years of age and older. While the older population
will grow significantly during the next two decades, most of that growth
will be among persons 65 to 74 years of age, who are at a relatively
low risk of needing long-term supportive services.
Trend #3 - Disability rates among
older persons have declined substantially.
The number of older persons with a chronic disability has remained essentially
unchanged at 7 million since 1989. Projections of future numbers of
older persons with disabilities depend on the assumed rate of declines
in disability rates. The number of older persons with chronic disabilities
would rise sharply to 15.9 million in 2030 if rates stay at 1994 levels,
increase more modestly to 8.9 million if rates decline 1.5 percent per
year (as they did between 1989 and 1994), and decrease to 6.1 million
if rates continue to decline 2.6 percent per year (as they did between
1994 and 1999).
Trend #4 - Socioeconomic improvements
have reduced disability rates among older persons.
Survey data indicate that declines in disability are concentrated among
older persons with the highest levels of education. Higher levels of
educational attainment among cohorts who will reach late old age over
the next few decades may indicate additional improvements in disability
levels.
Trend #5 - Medical advances have
also played a role in reducing disability rates.
Even though the prevalence of some chronic conditions has been increasing,
the debilitating effects of many of those conditions have been reduced.
Based on such findings, researchers have concluded that both treatment
and prevention of potentially disabling chronic conditions contribute
significantly to decreasing disability rates.
Trend #6 - Socioeconomic improvement
is increasing the service options available to older persons with disabilities.
The improved socioeconomic status of older persons is also playing a
major role in the choices available regarding long-term supportive services.
For example, the number of older nursing home residents paying privately
dropped by more than half (54 percent) from the number that would have
been expected if 1985 utilization patterns had remained constant. Older
persons with the means to pay privately appear to be voting with their
feet — and their wallets — for alternatives such as home care
services and assisted living.
Trend #7 - The narrowing ratio of
men to women in old age has contributed to the declining use of institutional
care and will likely continue to do so over the next few decades.
The overwhelming majority of supportive services for older persons with
disabilities is provided by family or friends. Demographic evidence
points to increased availability of family support for older persons
with disabilities over the next few decades. The narrowing gender ratio
of men to women among those 55 years of age and older will result in
lower rates of widowhood and may portend further improvements in spousal
support in the future. Older women are especially likely to benefit
from increased spousal support.
Trend #8 - Cohorts of older persons
reaching the high risk years of 75 and older during the next two decades
have more adult children than previous cohorts.
In contrast to the cohorts who are now 75 and older, individuals 55
to 74 years of age in 2000 have low rates of childlessness and high
average numbers of children. The combined effects of more living spouses
and more children will increase potential family support for at least
the next two or three decades.
Trend #9 - Utilization trends for
long-term supportive services differ substantially among racial/ethnic
groups.
The ethnic and racial makeup of the older population will become more
diverse over the next two decades as the number of older minorities
grows more rapidly than the population of older Whites. Adjusted to
the age structure of 2000, nursing home utilization rates fell from
61.2 per thousand persons aged 65 and older among Whites in 1973-74
to 41.9 in 1999. Among older Blacks, the comparable utilization rates
increased sharply from 28.2 per thousand in 1973-74 to 55.6 per thousand
in 1999. Small numbers make following trends among other ethnic groups
more difficult, although nursing home utilization appears to be much
lower among older Hispanics and Asians than among older Blacks and Whites.
Whether Hispanics and Asians will follow the pattern of Blacks by increasing
use of nursing homes in future years remains an open question.
Trend #10 - Assisted living has grown
substantially over the past decade, although the extent to which it
has replaced nursing home services is not well documented.
In one survey, the number of facilities providing assisted living services
increased by 49.4 percent between 1991 and 1999. Assisted living appears
to fill a gap for those with relatively low levels of disability as
nursing homes become increasingly focused on higher levels of disability
and more medical services. The average assisted living resident needs
assistance with 2.3 activities of daily living (ADLs) compared to 3.8
for residents in nursing homes and 1.6 for those receiving home health
services. Most assisted living facilities cannot serve those with complex
medical conditions and are not serving large numbers of persons who
need public subsidies, largely because of state and federal limitations
on those subsidies.
Trend #11 - Home health care utilization
grew rapidly but then declined precipitously following cuts in Medicare
reimbursements in the late 1990s.
The utilization of home health services increased rapidly before plummeting
in the wake of the Balanced Budget Amendment of 1997. Expenditures for
home health care increased from 1 percent of Medicare spending on those
65 years of age and older in 1967 to 10 percent in 1997, before retreating
to 6 percent in 1998. Recipients of home health services are much younger
and less disabled than are consumers in nursing homes or assisted living.
Trend #12 - Many nursing homes have
responded to the changing long-term supportive service market by becoming
increasingly diversified, specialized, and medicalized.
In 1996, 12.6 percent of skilled nursing homes offered 73,400 beds (out
of a total of 1.76 million beds) in special care units for persons with
Alzheimer's disease, by far the largest category of specialized care
units. Other special care units provided 18,500 beds for ventilator,
hospice, HIV/AIDS, and brain injury services. On the more medicalized
end of care, 5 percent of nursing homes had a distinct rehabilitation
and/or subacute special care unit with 28,500 beds. On the "light"
end of care, many nursing homes have also added assisted living services.
Trend #13 - Medicaid's institutional
bias in favor of funding nursing home services is slowly shifting toward
increased funding for home and community-based services.
From 1990 to 2000, the share of all Medicaid long-term care dollars
funded to home and community-based services doubled from 13.2 percent
to 26.9 percent. The dollars spent on such services more than quadrupled
from $3.9 billion to $18.2 billion during the same period. States vary
considerably in the degree to which they fund home and community-based
services — ranging from 5.4 percent of total long-term care expenditures
in Mississippi to 61.9 percent in Oregon in fiscal year 2000. Despite
the shift toward increased funding for home and community-based services,
older persons who rely on public funding are more likely to be institutionalized
than younger persons with disabilities.
Trend #14 - Increased public and
private payments for home and community-based alternatives have combined
with Medicare changes to reinforce the increased specialization and
medicalization of nursing homes.
Medicare's prospective payment system has shortened the length of hospital
stays and shifted much post-acute care to nursing homes, while more
"long-term" care is shifting to home and community-based settings.
Payer sources also reflect these changes as the number of nursing home
residents paying privately declined sharply between 1985 and 1999, while
the number of residents whose primary source of payment was Medicare
increased more than tenfold. Much of "long-term" supportive
services, at least for those who can pay privately, is shifting to other
venues while shortened hospital stays have shifted "short-term"
post-acute care, rehabilitation, and end-of-life care to nursing homes.
