Letters
CCRCs and LTC
While I found that the article by Yair Babed, Alex Leung, Al Schmitz, and
Jennifer Vandeleest (“A Global Perspec-
tive on Financing Long-Term Care”) in the
March/April issue of Contingencies con-
tained much interesting information, as
a resident of a continuing care retirement
community (CCRC), I was disappointed
that the article contained no information
that as I age and my health deteriorates
to the point that I need higher levels of
care such as assisted living or skilled
nursing care, I will continue to pay the
same monthly fee that I now pay for my
independent living apartment. In effect,
I have LTC insurance.
HEALTH CARE REFORM: LEARNING FROM OTHERS A Global Perspective on FINANCING LONG-TERM CARE
Isn’t it true that a 2-year-old Swiss
child in 1900 would live on average to 61,
while a current Swiss 2-year-old would
live to 86—an improvement of 25, not 35,
years? The difference is all those Swiss ba-bies who died before the age of 2—which
doesn’t happen now.
The current age of 86 also looks a little high if you consult the CIA (Canadian
Institute of Actuaries) World Factbook
(2011 estimates), which shows age 81 for
Swiss males. But I don’t have ready access to current actuarial tables.
D.R . Johnston
Willowdale, ontario
By Yair Babad, Alex Leung, Al Schmitz,
and Jennifer Vandeleest
BECAUSE OF INCREASING LONGEVI TY
and advances in medical technologies and treatment,
world wide demand for long-term care (LTC) is expected to grow by as much as 400 percent in coming
decades. While LTC isn’t limited to supporting the frail
elderly, the increase in older populations is the primary
driver for expanding demand. Different countries vary
in the current size and projected future growth of their
elderly populations—but all need to design programs
that will ensure relative comfort, financial security, and
independence for their oldest citizens.
Shares of Population Age 65 and Older and Age 80 and OlderShares of Population Age 65 and Older and Age 80 and Older
FIGURE 1
Japan
Germany
Austria
Netherlands
United States
60% 50% 40% 30% 20% 10% 0% 0% 5% 10% 15% 20%
■ 65+ 2010
Korea
■ 65+ 2030
■ 80+ 2010
■ 80+ 2030
Israel
Source: U.S. Census Bureau, International Data Base
42 CONTINGENCIES MAR | APR. 12 WWW.CONTINGENCIES.ORG
Germany and Japan currently have
the highest proportions of octogenar-
ians and of populations older than age
65, both of which are increasing rap-
idly (see Figure 1). While the projected
speed of aging in the Japanese and Ko-
rean populations is faster than that of
other developed countries (a problem
that is exacerbated by large declines in
both fertility and mortality), most of the
world is moving in the same direction.
These trends will lead to mounting na-
tional LTC financial burdens. As populations
age, LTC expenditures necessarily will grow
as a percentage of gross domestic product (see
Figure 2). Finding solutions to the looming LTC
funding crisis is emerging as a critical issue across the
world.
All existing national LTC systems are organized around
varying levels of public and private cooperation. But
public financing of LTC is complicated by the fact that
declining fertility and an aging workforce are reduc-
ing tax revenues at the same time that the financial
burden of covering LTC, pensions, and other ge-
riatric needs is increasing.
Austria, Germany, Israel, Japan, Ko-
rea, the Netherlands, and the United
States all face similar crises regard-
ing financing the care of their elderly
citizens. But while some of these na-
tions have enacted LTC reforms
over the past couple of decades,
theirapproacheshavedif-
fered significantly.
THINKSTOCK
DEFINING LONG-TERM CARE
Long-term care (LTC) is
health and personal care
that is provided for people
with chronic illnesses or
disabilities. LTC includes
support services and
assistance for activities
of daily living (ADLs)
such as eating, bathing,
and dressing. LTC can be
delivered in the home, in
a community, in assisted
living facilities, or in
nursing homes.
MAR|APR. 12 CONTINGENCIES 43
about the role CCRCs play in providing
long-term care (LTC) in the United States.
As of 2007, 745,000 U.S. older persons
resided in such facilities—many of which
provide subsidized LTC. That figure had
been growing rapidly, more than doubling in a decade, and while undoubtedly
it has slowed recently, it will accelerate
again as the economy improves.
While the number of CCRC residents
seems modest in relation to the estimated U.S. population aged 65 and older of
40 million, a more relevant comparison
is with the estimated 5.75 million U.S.
citizens aged 85 and older, since the
age distribution of CCRC residents is
heavily weighted in the later ages (in
which the need for LTC is concentrated).
I reside in a Type A CCRC. This means
move to a higher level of care, but still don’t
reach a full fee-for-service cost level.
Representative government
In his letter published in the March/ April 2012 issue of Contingencies,
Steven Rubenstein quotes Abraham Lincoln’s Gettysburg address and concludes
that government is not something separate from those governed. In his speech
(to a predominantly white audience),
Lincoln spoke of three types of people, of
whom only one type—white men—could
vote and run for office. White men (by
the people) governed everyone (of the
people) for white families (for the people). For the majority of Americans who
weren’t white men, government was
something separate.
tHInkStoCk
Jan harrington
new york
Dwight Bartlett
Annapolis, Md.
Age Matters
In “Come Together: Building a Better Mortality Model,” in the March/April
issue of Contingencies, the author writes
that a Swiss male born in 1900 lived to
an average age of 51 years, compared to
86 or more currently. This increase is
attributed to a number of modern advances in health care.
