Even if you won’t admit it, I will, I’m getting older. The truth is our population is getting older.
Among Missouri’s approximately 6 million citizens, 17.5 percent, or 1,040,491, are Medicare beneficiaries. Among these, nine out of 10 are seniors. Moreover, the number of seniors is disproportionately higher in Missouri’s rural areas. Many of these seniors are on low- or fixed-incomes.
Beginning in 2011, the oldest of the baby boomers — those born between 1946 and 1964 — started to become Medicare eligible. Daily, 10,000 boomers will age into the system, a trend that is expected to continue until 2029.
During this period, a shift in population will occur. The percentage of Americans age 65 and older is projected to expand from 13 percent in 2010 to 19.3 percent by 2030. Missouri’s percentage of seniors is nearly a full point ahead of the national average already, and Missouri will stay in the top half of states through 2030.
With the aging of baby boomers, the Medicare population is projected to grow from 54 million today to more than 80 million in 2030. If Missouri follows the national trend — which evidence suggests it will — 1.5 million Missourians could be Medicare beneficiaries in 15 years.
Research from the AARP suggests that, “Eighty percent of older people want to ‘age in place.’” Because Missouri already has a larger share of seniors living in rural areas, it is fair to expect that demand for services — particularly health care — will grow. The baby boomer generation currently enjoys higher life expectancy than earlier generations and higher rates of chronic medical conditions like obesity and hypertension. What we also know is that those over age 85 consume health care services at rates double than those between ages 65 and 74. That means to “age in place” they will need ready access to health care providers and a strong rural health care system.
Golden Valley Memorial Healthcare is a rural health care provider. Our largest customer base is Medicare beneficiaries and if projections are on target that customer base will continue to grow. Here’s the problem. Medicare rates are being reduced every year for the forseeable future and Medicare patients will be consuming more and more resources for the forseeable future. Logically you can understand why Medicare rates are being reduced. One way to make Medicare funds go farther is to reduce the amount it pays and spread it over a great number of people but at some point Medicare payments become so low that they no longer cover cost and it becomes very difficult for health care providers to continue to provide service.
Even today a portion of the burden for payment for services not covered by Medicare is shifted to commercial insurers. As the Medicare population grows the number of commercially insured shrinks so the cost shift currently subsidizing Medicare will shrink. The compounding problem is that younger, working people pay into Medicare and the money paid in by them helps to fund services provided to Medicare recipients who paid in during their working careers. We are about to tip the scales where there are more people receiving Medicare benefits than those paying in.
I don’t have a proposed solution – all I’m saying is we’re all getting older…