Report Projects Future Need for Long-Term Care, Effects on Family and Public Policy

Contact: Thomas Mentzer, (202) 261-5627, tmentzer@ui.urban.org

WASHINGTON, D.C., May 7, 2007 -- Providing long-term care to older adults is a growing challenge for American families. About 10 million people 65 and older now depend on such services, and that number is expected to double by 2040.

A new report from the Urban Institute projects the number and percentage of people 65 and older with disabilities and their use of long-term care services. The analysis shows how changes in disability levels, financial resources, their adult children's availability, and other factors will affect the demand for paid and unpaid long-term care services.

"With families shrinking and more women working outside the home, paid long-term care services will probably become more common," said Richard W. Johnson, coauthor of "Meeting the Long-Term Care Needs of the Baby Boomers: How Changing Families Will Affect Paid Helpers and Institutions." Desmond Toohey and Joshua M. Wiener are also coauthors of the report.

Johnson added, "The higher demand for paid services will further strain Medicare and Medicaid and could create financial problems for families not qualifying for public benefits."

Highlights from the report:

• Intermediate projections show that disability rates at ages 65 and older will fall from 30 to 28 percent between 2000 and 2040. However, because the overall size of the older population will increase rapidly, the number of disabled older Americans will increase from about 10 million to about 21 million.
• Even if disability rates decline by about one-third between 2000 and 2040, the disabled older population will grow by about 50 percent, to 15.1 million, by 2040.
• The disabled older population will grow faster than the younger population. Intermediate projections show that in 2040 there will be 9 adults ages 25 to 64 to support each disabled older adult, down from about 15 younger adults in 2000.
• The number receiving paid home care will more than double during that period, increasing from 2.2 million to 5.3 million. The number of older nursing home residents will increase from 1.2 million to 2.7 million.
• The share receiving unpaid help from their children will fall from about 28 to 24 percent, reflecting declines in family size and improvement in women's earnings.

How long-term care arrangements evolve will depend on future policy choices, Johnson said. Promoting private long-term care insurance might add funding for future services and increase the use of paid care. Medicaid and Medicare expansions could also make paid services more affordable.

However, problems recruiting and retaining long-term care workers could limit the availability of paid services and sharply raise costs. "Because the work is hard and the pay is low, turnover rates for nurse assistants in nursing homes and home health agencies are very high, which threatens the quality of care," Johnson said.

The report, available at http://www.urban.org/url.cfm?ID=311451, was made possible by funding from the Robert Wood Johnson Foundation through its Changes in Health Care Financing and Organization initiative.

This is the latest study from the Retirement Project, a crosscutting team of Urban Institute experts in Social Security, Medicare, Medicaid, tax and budget policy, and micro-simulation modeling. For more information, go to http://www.urban.org/toolkit/issues/retirementproject/index.cfm.

Audio files from a May 1 forum—"Who Will Pay for Boomers' Long-Term Care?"—are available at http://www.urban.org/Pressroom/firsttuesdays/may2007.cfm.

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