Americans 60 and older are facing an uncertain future, with 80% of this population having too few resources to pay for long-term care or even basic things like food to live independently.
That’s according to an updated analysis by two national aging organizations: The National Council on Aging and the LeadingAge Long Term Services and Support Center @ UMass Boston.
Today’s 65-year-old can expect to live another 20 years, according to the Social Security Administration.
The analysis, Increases in Older Americans’ Income and Household Assets Still Cannot Support Most During Financial Hardship, looks at the financial state of older Americans by comparing the income, housing value, retirement and other savings of people 60 and older with the cost of of long-term care.
It also used the Elder Index, an online tool that shows how much money older adults need to live independently.
A silver tsunami of epic proportions
And what it found is not good: Roughly 27 million households with adults ages 60 and older cannot afford basic living needs — things like food or health care. One reason why could be the lack of awareness about what it costs to age well.
“I think the big issue is in terms of education," explained Lauren Marinaro, a partner at Fink Rosner Ershow-Levenberg Marinaro, an elder and disability law firm in New Jersey, and a board member of the National Academy of Elder Law Attorneys.
“And so if people kind of operate from the assumption that, oh, ‘My Medicare will take care of this,’ then they might not make certain plans, they might not save for long-term care. And, look, no old person is like, ‘Yeah, I'm going to a nursing home.’ Nobody is planning for that because nobody thinks that they're ever going to get that sick," Marinaro said.
Until they do. And statistically speaking, they likely will. A person turning 65 today has a nearly 70% chance of needing long-term care at some point.
But even those who plan and do everything right, are not necessarily protected. Many Americans will experience what’s called a negative wealth shock, meaning they’ll lose a significant portion of their net worth.
Even the best plans can crumble
“I will say that how our ratios look are a little skewed because most of our service area is a retirement community, so these are people who have prepared for retirement in an active resort type environment," Keeme said.
They tend to have more wealth than the general population of seniors.
“However, even though folks do prepare unexpected health issues that they have not prepared for when they crop up, push them into a new category of needing assistance," Keeme said.
Which they might not be able to afford, she said. So they rely on volunteer programs like Neighbors Who Care to help fill the gap.
The challenge, Keeme says, for this segment of the population is that there’s only so much a volunteer can do.
“Because we don't do anything medical. It becomes difficult for us because then we don't really have anything to refer them to," Keeme said.
Other than Arizona’s Long Term Care System, which covers the cost of long term care services including home health and nursing home care, she said. But for families who have assets, but not nearly enough to pay the thousands of dollars a month it costs for that kind of care, ALTCS isn’t an option.
The updated analysis found that despite older adults' preference to age in place, 60% would be unable to afford two years of in-home long-term services and supports.
“So, then they're encouraged to spend down their assets in order to be able to qualify for this, and then they're left with nothing.”
And if there’s a healthy, surviving spouse, they’re also left without much.
Arizonans want to age at home, but how?
Justin McBride is the senior director of services and strategy at Duet Partners in Health Aging, which serves homebound seniors.
“The vast majority of Arizonans we've heard from would prefer to age in place — in their own home," McBride said.
But according to the report, that is out of reach for most older adults.
McBride says about 85% of the seniors they serve have incomes under $2,800 a month. But just because they might meet the income eligibility criteria of ALTCS, doesn’t mean they’ll meet the medical criteria. And ALTCS is incredibly difficult to acquire — even when both criteria are met.
So they call organizations like Duet who, like Neighbors Who Care in the East Valley, rely on an army of volunteers to help with doctor’s visits, food shopping and other chores around the house. But like any nonprofit doing the heavy lifting, resources, especially human ones, are limited.
“We are limited by the number of volunteers that we have, said McBride. “We're limited by the amount of generous contributions that we have coming in. And it's through the community stepping up to serve, whether it's serving your neighbor directly or coming to somebody like Duet.”
But even McBride acknowledges that the kindness of strangers is not enough to support the state’s increasingly aging population.
He says that by 2050, around a quarter of Arizonans will be 65 and older — and that includes members of generation X, the eldest of whom are turning 60 starting next year.
