As Published in Business 2 Business , August 2005

Boomers Turn Gray, Health Care Experiences Aches and Pain

"Round and round it goes," the carnival worker barks over his spinning wheel. "Where it stops, no one knows."

Like these games of chance, the future of health care in the U.S. as well as in most developed countries, is unknown. Three irrefutable trends are stacking the odds against a quick and affordable fix: The graying of America; the scarcity of health care providers trained to care for older Americans; and an explosive demand for access to the most sophisticated and advanced care regardless of the ability to pay. These intertwined but independent trends have profound implications for the way employers can and will conduct business.

In less than 10 years, by 2012, approximately 10,000 Americans will turn 65 every day. Twenty percent of the population, 71 million people, will be 65 or older in 2030. The total number of Americans aged 65 and older, and eligible for Medicare, will double to over 70 million within this generation. The population aged 85 and over will increase nearly five-fold, to almost 19 million, by mid-21st century.

Some truths about aging
The 2002 State of Aging & Health in America, as well as other sources, indicates older adults use more health care services than any other age group. Today, those aged 65 and older represent 13% of the population and account for half of physicians' visits and half of all hospital stays. The average 75-year-old has been diagnosed with three chronic conditions and uses five prescription drugs.

Curiously, there is a gap between aging patients who look to health care providers and the training of those charged with giving that care. A small proportion of practicing health care providers have formal training in geriatrics. Of the 650,000 practicing physicians in the U.S., less than 9,000 are geriatricians. That means there are approximately 2.5 geriatricians per 10,000 elderly patients. Sadly, that number is expected to fall to about 6,000 in the near future.

Fewer than 3 percent of current medical students take elective geriatric courses. Additionally, 720 pharmacists out of 200,000 have geriatric certification. A 1997 survey of 600 nursing baccalaureate programs showed a mere 23 percent of schools required a course in geriatrics. Less than one-half of one percent of nurses has advanced certification in geriatrics. Five percent of social workers identify geriatrics as a primary practice area.

The shortage of qualified providers is only part of the story. This shortage translates into a lack of specialists who teach or act as preceptors to physicians in training. In spite of demographic trends, the majority of educational curricula including nursing, pharmacy, medicine and dentistry do not require geriatric training or have just started to introduce it into their curriculums. Overall, the health care work force lacks the training to provide appropriate care at the present time,

There's no such thing as "free" care
The U.S. Census Bureau reports that 45 million Americans did not have health insurance at one time or another during the past year. What makes this statistic more disturbing is the article in the San Francisco Chronicle stating that 20.6 million of these individuals were working full-time.

Consider this: emergency rooms across the country fill daily with patients experiencing acute episodes from otherwise treatable chronic conditions. Many of these patients are uninsured or underinsured people who have chronic conditions that are not properly managed because they can't afford the cost of medications and preventive care. The insured, self-pays, hospitals and physicians pick up the tab for the uncompensated care. The problem won't go away anytime soon because the Emergency Medical Treatment and Active Labor Act of 1985 requires hospitals to treat all patients seeking care in an emergency room regardless of financial circumstance, nationality or legal status.

The cost of emergency care for the uninsured is enormous. Just recently, the Journal of American Physicians and Surgeons reported that 60 California hospitals closed their doors and another 24 are on the verge of closure largely because of uncompensated medical costs. Thirty-eight Arizona-based medical centers reported losses of $153 million. Scripps Memorial Hospital in San Diego was forced to close after losing more than $5 million a year in unreimbursed emergency care.

The poor health and premature deaths of people without health insurance costs the nation between $65 billion and $130 billion annually, according to a study conducted by the Institute of Medicine. Other studies estimate the percent of uncollected health care bills represent as much as a 33 percent drop in revenue for hospitals. Some of the cost is absorbed by hospitals and physicians as bad debt or charity care; the remainder is shifted to you and me in the form of inflated costs to private insurance companies and federally and state-funded government programs. The net result is an increase in the cost of health care for those who can afford to pay. This finite amount of money available to pay for health care services restricts the amount of health care available to the entire population.

The traditional U.S. government approach to escalating costs has been to decrease spending by cutting back on programs; today, there are rumblings of deeper cuts to Medicare and social security programs. Although the government guarantees that more people will be covered, the utilization of services by each person can only increase as the population ages. That's where the corresponding trends of an aging population and rising health care costs intersect.

Squeezing the balloon
Less reimbursement available to physicians and hospitals means an increase in losses to providers. These losses will likely be balanced by higher charges. These charges drive up the cost of health care for the few private payers, but the hardest hit will be employers.

Employers must protect profit margins so they pass on some of that cost to employees. This is about good business, not punishing employees. Although increases in health care cost may anger employees, that increase is preferable to the employer going out of business. But the simple reality is that many people live paycheck to paycheck. One more dollar for health care may mean one dollar less for necessities such food, clothing, shelter and child care. The higher deductibles and co-payments, increased employee contributions toward premiums, and less coverage-immediate solutions for employers-come back to bite everyone.

Young, healthy employees may opt to "go bare," assuming that, on the rare occasion they have medical needs, emergency room physicians will become de facto primary care providers. That's the tip of the problem. Eliminate younger and healthier workers from the pool of insured employees and the community risk goes up, which means employers see their premiums increase. This becomes a vicious circle with higher costs driving out even more healthy workers. And, that places the already considerable burden of paying for health care on those who opt to purchase some form of health insurance from employers or those who can afford to self-pay.

The buck stops … where?
We need to stop passing the health care buck. Everyone has a degree of accountability. Government leaders should stop "stealing from Peter to pay Paul" for systems that are hopelessly inefficient, albeit politically safe. Business leaders should consider the health of the workforce as an investment toward improving productivity, rather than as a cost to be cut. All of us, whether employed, unemployed or retired, need to take responsibility for health maintenance. We should respect and value the availability of and our access to health care providers and treat this resource as a privilege, not an entitlement.

Without innovation and collaboration and cooperation among people in government, business, and our communities we will be wholly and woefully unprepared for the graying of America and the impending senior boom.

SideBar
The numbers don't lie
Since 1900, the number of older adults has increased eleven-fold, from 3.1 million in 1900 to 35 million in 2000. Four of every 10 people in the work force will be older than 45 in two years. By 2010, one of every five employees will be aged 55 or older. By the middle 21st century, there will be more seniors than children. That statistical milestone is less than 50 years away.

Ira Wolfe is founder of Success Performance Solutions (www.super-solutions.com), a Lancaster consulting firm providing employment and career testing. He has authored two books, Business Values and Motivators and The Perfect Labor Storm: Why Worker Shortages Will Not Go Away. He speaks to national audiences on The Perfect Labor Storm and HR Trends That Will Change the Way Employers Do Business.