The future looks pretty grim for boomers as they age, thanks to soaring health care costs.
That’s according to HR Dive, which reports the toll taken on aging baby boomers by skyrocketing costs will put pressure on employees to help parents and other older relatives — and, in turn, on employers who would be well advised to find ways to help younger employees cope with not just the expense, but the need to become caregivers.
The report cites Conference Board research which estimates an increase in health care costs for aging baby boomers of 20.8 percent for home services and nursing facilities, and an even bigger increase of 25.8 percent for retirement communities with continuous care.
The Conference Board writes that since life expectancy is on the rise, “while the U.S. population as a whole will grow by 8 percent between 2015 and 2025, the number of people between the ages of 70 and 84 will spike by 50 percent.” The number of retirees is “currently increasing by about 1.2 million a year, about three times as much as a decade ago,” it continues.
The demographics of so many retirees will boost health care spending by 15 percent “due to demographic trends alone,” Gad Levanon, chief economist at The Conference Board and an author of the report, says in a statement.
Levanon adds, “More so than any other category, health care spending is concentrated among the oldest households. Long-term care, in particular, is likely to experience even more dramatic growth of 20-25 percent due to demographic trends alone.”
In addition, the rise in elderly care costs, HR Dive says, “will make caregivers of sick or elderly parents need paid family leave, HSA contributions, employee assistance programs and vendor services more than ever.”
But while HSAs can help caregiving employees to provide help for elderly parents, the report cautions that those accounts can be too expensive for lower-paid workers to use — and employers need to remember that even as they consider adding HSAs to help employees deal with the expense of caregiving. Other solutions, such as employee assistance programs and vendors that offer eldercare solutions, should be considered as well.