Between 2010 and 2050, the United States population ages 65 and older will nearly double, the population ages 80 and older will nearly triple, and the number of nonagenarians and centenarians—people in their 90s and 100s—will quadruple. 1 The aging of the population has important implications for future Medicare spending because beneficiaries ages 80 and older account for a disproportionate share of Medicare expenditures.
Full Answer
How does Medicare work for the elderly?
With the enactment of Medicare in 1965, basic health insurance protection for hospital care and physician services was extended to nearly all elderly Americans. The universal nature of Medicare coverage means that virtually no elderly person is without insurance.
How does low-income health care affect the elderly?
Low-income elderly Americans experience more health problems and have greater use of health services with the associated cost for treatment and medication than higher income elderly. The 1 in 5 low-income Medicare beneficiaries without Medicaid to supplement Medicare are particularly at risk.
Does socioeconomic status affect health outcomes among older adults?
As documented in this mini-review, substantial evidence exists to support the strong interplay between socioeconomic status (SES), healthcare access, and healthy aging. Several studies document the relationship between SES, healthcare utilization, and health outcomes among older adults across the globe.
Does Medicare reduce out-of-pocket medical expenditures for the elderly?
Even absent measurable health benefits, Medicare's introduction of Medicare may still may have benefited the elderly by reducing their risk of large out-of-pocket medical expenditures. The authors document that prior to the introduction of Medicare, the elderly faced a risk of very large out- of- pocket medical expenditures.
How does socioeconomic status affect the accessibility and use of healthcare services?
In a variety of contexts, lower SES is associated with reduced access to care, poorer health outcomes, and increased mortality and morbidity as individuals age (9–18). Thus, this mini-review specifically targets the relationship between wealth, access to healthcare, and healthy aging.
How does Medicare affect the economy?
In addition to financing crucial health care services for millions of Americans, Medicare benefits the broader economy. The funds disbursed by the program support the employment of millions of workers, and the salaries paid to those workers generate billions of dollars of tax revenue.
What are socioeconomic factors in healthcare?
An individual's socioeconomic position can be shaped by various factors such as their education, occupation, or income. All of these factors (social determinants) impact the health and well-being of people and the communities they interact with.
What is an example of how health affects socioeconomic status?
There is evidence that socioeconomic status (SES) affects individual's health outcomes and the health care they receive. People of lower SES are more likely to have worse self-reported health,5,6 lower life expectancy,7 and suffer from more chronic conditions8-11 when compared with those of higher SES.
Who is impacted by Medicare?
Medicare is the federal health insurance program created in 1965 for people ages 65 and over, regardless of income, medical history, or health status. The program was expanded in 1972 to cover certain people under age 65 who have a long-term disability.
What does Medicare mean in economics?
Medicare is a national healthcare program funded by the U.S. government. Congress created the program as part of amendments to the Social Security Act in 1965 to give coverage to people ages 65 and older who didn't have any health insurance.
How do socioeconomic factors affect?
Social and economic factors, such as income, education, employment, community safety, and social supports can significantly affect how well and how long we live. These factors affect our ability to make healthy choices, afford medical care and housing, manage stress, and more.
What are the 5 socioeconomic factors?
Viewing such a medium as a form of new innovation, the five socio-economic characters namely gender, age, income level, education level and the exposure to the Internet were hypothesized to see whether there was any relationship between these five factors and the consumer's willingness to adopt e-commerce.
What are socioeconomic barriers?
What Are Socio-Economic Barriers? “Socio-Economic barriers to upward mobility” is a general term for the social pressures that prevent people born into a lower class from moving over the course of their lives, or even generations, into a more affluent class.
What are three socioeconomic factors that influence health care?
Evidence has accumulated, however, pointing to socioeconomic factors such as income, wealth, and education as the fundamental causes of a wide range of health outcomes.
How socioeconomic status affect the health health choices of an individual?
Individuals either living in poverty or near the poverty line are more likely to have problems with access to health care, have lower rates of health care utilization, and report that they have less satisfaction with care than individuals with higher SES scores [24, 27, 28].
How are health disparities impacted by socioeconomic status?
Evidence has shown the critical role of socioeconomic factors in understanding health disparities. For example, low socioeconomic status is linked to such negative health outcomes as low birth weight, diabetes, depression, life expectancy, heart attacks and lower self-rated health.
What is the evidence that the introduction of Medicare was associated with faster adoption of then-new cardiac technologies?
Consistent with this, Finkelstein presents suggestive evidence that the introduction of Medicare was associated with faster adoption of then-new cardiac technologies. Such evidence of the considerable impact of Medicare on the health care sector naturally raises the question of what benefits Medicare produced for health care consumers.
When did Medicare start?
Medicare's introduction in 1965 was, and remains to date, the single largest change in health insurance coverage in U.S. history. Finkelstein estimates that the introduction of Medicare was associated with a 23 percent increase in total hospital expenditures (for all ages) between 1965 and 1970, with even larger effects if her analysis is extended ...
Why is there a discrepancy in health insurance?
Finkelstein suggests that the reason for the apparent discrepancy is that market-wide changes in health insurance - such as the introduction of Medicare - may alter the nature and practice of medical care in ways that experiments affecting the health insurance of isolated individuals will not. As a result, the impact on health spending ...
How much does Medicare cost?
At an annual cost of $260 billion, Medicare is one of the largest health insurance programs in the world. Providing nearly universal health insurance to the elderly as well as many disabled, Medicare accounts for about 17 percent of U.S. health expenditures, one-eighth of the federal budget, and 2 percent of gross domestic production.
What was the spread of health insurance between 1950 and 1990?
Extrapolating from these estimates, Finkelstein speculates that the overall spread of health insurance between 1950 and 1990 may be able to explain at least 40 percent of that period's dramatic rise in real per capita health spending. This conclusion differs markedly from the conventional thinking among economists that the spread ...
Does market wide change in health insurance increase market demand for health care?
For example, unlike an isolated individual's change in health insurance, market wide changes in health insurance may increase market demand for health care enough to make it worthwhile for hospitals to incur the fixed cost of adopting a new technology.
Which countries have poorer older adults?
Poorer older adults in China and India report greater functional impairment and disability than older adults in the richest, richer, and middle-income classes. China and India. Zimmer (35) The poorest older adults report the worse health outcomes, with marginal gains in income associated with improvements in health.
Why is evidence important for older adults?
Because financial resources are proportional to health status, efforts are needed to support older adults and the burdened healthcare system with financial resources.
What is the goal of healthy aging?
Healthy aging is a primary goal of modern medicine , especially as it relates to geriatric care.
Do older adults receive preventive care?
Older adults in the United States are significantly more likely to receive clinical preventive services with access to regular sources of healthcare. (42) Similarly, for people with intellectual disabilities in the United States, access to proper screenings and preventive services facilitates healthy aging (56).
Does Mexico have income supplementation?
Mexico experimented with income supplementation for older adults. Elderly residents of two states in the Yucatan who received income supplementation (i.e., a 44% increase in household income) spent their extra income on doctor visits and medications, and realized improved health outcomes (62).
What is the SES-health nexus for the elderly?
The research indicates that the strong SES-health nexus for the elderly is essentially a consequence of persistent health outcomes over long periods. The ability of individuals to reach and secure an independent income for their advanced years can be greatly affected by the condition of their health over their lifetime.
Why are older people healthier?
This association has led some to conclude that senior citizens who have more household wealth are healthier simply because they can afford better health care as they age.
Why is differential mortality by sex important?
Additionally, differential mortality by sex may play a role—because men in poor health die younger, only the more robust men are counted among the elderly.
Why is it not a proper basis for understanding the health effects of additional economic resources?
Such an approach does not provide a proper basis for understanding the health effects of additional economic resources because the incomes of older individuals are affected by both current and long-term feedbacks from health to income.
How does health in old age relate to health history?
Health in old age similarly reflects one's long-term health history. The study's findings show that health status in advanced years is greatly influenced by a history of health that goes back to one's childhood and reaches even beyond personal health status to include the health status of parents and siblings throughout their lives.
Is the SES-health correlation weaker at the mid level?
While the SES-health correlation is strong at the lowest socioeconomic levels, it becomes weaker at mid levels , and is almost nonexistent at the upper levels. These results suggest that the reasons for different health outcomes among senior citizens are more complex than has been previously believed.
Does Medicare have a clear grasp of the socioeconomic status of the elderly?
As the nation prepares to redesign its Medicare, Medicaid, and Social Security policies, therefore, it still does not have a clear grasp of how health and socioeconomic status (SES) interact and affect the lives of the elderly.
What percentage of the elderly spent on prescription drugs in 1990?
As a result, the elderly spent an average of 3.1 percent of their household income on prescription drugs. Some elderly households, however, have much higher levels of expenditures and financial burden than others.
How much did Medicare increase in 1990?
Overall, providing drug coverage under Medicare would increase expected annual spending on prescription drugs by $83 per elderly beneficiary in 1990 dollars, but this effect is significant only at the .10 level.
When was Medicare Catastrophic Act repealed?
For example, the Medicare Catastrophic Act of 1988, which contained a prescription drug benefit, was passed into law but repealed before it became effective, and during the health debate in 1993, administration proposals would have added the benefit to Part B of Medicare. New proposals are circulating again.
Does Medicare negotiate discounts on drug prices?
The actual budgetary effect would depend on the structure of the benefit, including the size of potential copayments, deductibles, or annual limits on benefit amounts. Medicare would also be likely to negotiate discounts on drug prices, which would lower total program outlays relative to the estimates presented here.
Does insurance increase the amount of prescriptions?
However, among persons with use, insurance coverage did not increase the total amount spent for prescription drugs. Thus, overall, insurance coverage increases expected spending on drugs, primarily by increasing the number of persons with any use.
Is outpatient prescription drug use covered by Medicare?
Use Adobe Acrobat Reader version 10 or higher for the best experience. Research Brief. Since outpatient prescription drug use is not covered by Medicare, it is a major source of out-of-pocket expenditures for the elderly. By one estimate, severely disabled elderly persons spend more than half their out-of-pocket health expenditures on outpatient ...
What are the policies affecting older adults with multiple, serious chronic conditions?
Policies affecting older adults with multiple, serious chronic conditions – costs of care; differential impact of health care costs and access by race, ethnicity, gender, socio-economic status; improvements in the health care system including models of care coordination, integrated mental health and preventive care .
How many people will be 65 by 2030?
By 2030, 71 million Americans (about 20% of the U.S. population) will be 65 and older. These individuals are at high risk for complex health problems, chronic illness, and disability, and they are, and will continue to be, the heaviest users of health care. Although estimates vary, today, older adults account for a substantial proportion ...
What is the role of states in health policy?
The role of States in health policy. Reauthorizing the Older Americans Act. Strategies for chronic care coordination. Mental health and preventive healthcare benefits in Medicare. Health information technology. Engaging consumers in health care quality. Funding for health professionals training.
What are the challenges of aging?
Our nation’s decision makers are currently confronting an enormous range of specific challenges in health care for the aging. These include: 1 Contributions to the Affordable Care Act 2 Medicare payment reform 3 Restructuring health care delivery systems (e.g., the medical home concept) 4 Regulation of nursing homes and long-term care facilities 5 Improving quality through financial incentives (e.g., Medicare’s Value-Based Purchasing Initiative) 6 The role of States in health policy 7 Reauthorizing the Older Americans Act 8 Strategies for chronic care coordination 9 Mental health and preventive healthcare benefits in Medicare 10 Health information technology 11 Engaging consumers in health care quality 12 Funding for health professionals training 13 Setting priorities for biomedical and behavioral research in aging 14 Providing care for the aging cohorts of U.S. veterans 15 Strategies for individuals dually eligible for Medicare and Medicaid
What are the principles of Medicare reform?
The conservative idea of Medicare reform is rooted in three basic principles: First, government control over medical pricing and inadequate incentives for individuals to control their own health-care costs lead to waste and inefficiencies.
What percentage of Medicare beneficiaries are under cost sharing?
The permanent drug benefit, which includes substantial out-of-pocket “cost-sharing” for middle-income and high-income seniors, requires only minimal cost-sharing for those below 150 percent of the poverty level. This includes roughly a third of all Medicare beneficiaries.
How many days of skilled nursing care is covered by Medicare?
If someone suffers a stroke, for example, Medicare covers the expenses incurred in its immediate aftermath — hospital care, 21 days of skilled nursing care with no deductible, and 79 additional days of skilled nursing care for a subsidized rate of $109.50 per day.
What is Medicare Part A?
In March 2004, the Medicare Board of Trustees issued its annual report on the financial health of Medicare Part A, which funds primarily hospital expenses, and Medicare Part B, which funds outpatient care.
Why are liberals and conservatives so nervous?
Of course, this idea still makes both sides a bit nervous — liberals because they fear the unraveling of Medicare as a universal entitlement, conservatives because they fear out-of-control taxes on successful wage-earners. But in such a bitter debate, this is a crucial point of consensus.
What is the problem with the federal government reducing payments for cancer drugs?
The problem is that when the federal government reduced payments for cancer drugs, as it did in MMA, there was “a shift of patients out of the doctor’s office and back to the inpatient hospital care, which reduces patient satisfaction and could increase federal outlays.”.
When was the Medicare Modernization Act signed into law?
The Medicare Modernization Act (MMA), signed into law in December 2003, has no doubt made this financial crisis even worse.
Why is the analysis focusing on Medicare beneficiaries over age 65 rather than younger adults who qualify for Medicare?
The analysis focuses on Medicare beneficiaries over age 65 rather than younger adults who qualify for Medicare because of a permanent disability to develop a better understanding of the relationship between Medicare spending and advancing age. This study examines patterns of Medicare spending among beneficiaries in traditional Medicare rather ...
What percentage of Medicare beneficiaries were enrolled in 2011?
Because we lack comparable data for the 25 percent of beneficiaries enrolled in Medicare Advantage in 2011, it is not possible to assess whether patterns of service use and spending in traditional Medicare apply to the Medicare population overall. More information about the data, methods, and limitations can be found in the Methodology.
How much did Medicare spend in 2011?
Average Medicare per capita spending in 2011 more than doubled between age 70 ($7,566) and age 96 ($16,145). The increase in Medicare per capita spending as beneficiaries age can be partially, but not completely, explained by the high cost of end-of-life care.
When did Medicare per capita increase?
Between 2000 and 2011, Medicare per capita spending grew faster for beneficiaries ages 90 and older than for younger beneficiaries over age 65, both including and excluding spending on the Part D prescription drug benefit beginning in 2006.
Is Medicare spending data available for all people?
The analysis excludes beneficiaries who are age 65 because some of these beneficiaries are enrolled for less than a full year; therefore, a full year of Medicare spending data is not available for all people at this year of age. The analysis focuses on Medicare beneficiaries over age 65 rather than younger adults who qualify for Medicare because ...
Will population aging affect health care?
According to the Congressional Budget Office, population aging is expected to account for a larger share of spending growth on the nation’s major health care programs through 2039 than either “excess spending growth” or subsidies for the coverage expansions provided under the Affordable Care Act. 2. To inform discussions about Medicare’s role in ...
Does Medicare increase as you age?
As the U.S. population ages, the increase in the number of people on Medicare and the aging of the Medicare population are expected to increase both total and per capita Medicare spending. The increase in per capita spending by age not only affects Medicare, but other payers as well.
Examining Disparities in Functional Health
A New Measurement of Household Resources
- The study's results suggest that the conventional method of measuring the economic resources of the elderly—looking only at current household income aggregates—is far from adequate. Such an approach does not provide a proper basis for understanding the health effects of additional economic resources because the incomes of older individuals are affected by both current and l…
Long-Term Influence of Health
- The research indicates that the strong SES-health nexus for the elderly is essentially a consequence of persistent health outcomes over long periods. The ability of individuals to reach and secure an independent income for their advanced years can be greatly affected by the condition of their health over their lifetime. Long-term health status may have an impact on scho…
Minority Differences
- This long-term SES-health interaction is especially significant for elderly Americans who belong to minority groups. The research supports earlier work showing that Hispanic and black senior citizens bear a greater-than-average risk of losing their functional abilities. However, it appears that they do so not because they are less affluent but beca...
The Gender Question
- Although the interaction of SES and health accounts for variations in old-age functioning across racial and ethnic lines, it cannot explain why elderly women do not function as well as men. This gender gap may be the result of hormonal differences related to reproduction, indicating that the cumulative effect of maternal depletion persists into old age. Other possible explanations involv…
Conclusion
- Both wealth and health at old age are greatly influenced by long-term health history—by a long line of events in the health status of individuals and their families. Yet this important relation between SES and health offers only a partial explanation for differences in the health of various groups of elderly Americans. Besides giving little insight into the poorer health status of older women, it pr…
Notes
- James P. Smith and Raynard S. Kington, "Race, Socioeconomic Status, and Health Late in Life," in Racial and Ethnic Differences in the Health of Older Americans, Linda G. Martin and Beth Soldo (eds....