Personal Home Care - Facilitating Choice and Independence

Demographers project that by 2040, the U.S. population aged 65 and older will double to 80 million and their share of the total population will rise from 13 to 20 percent.  Driving this fundamental demographic shift is a confluence of factors.  First, as the baby boom generation (those born between 1946 and 1964) ages, the growth rate of the portion of the U.S. population over age 65 will accelerate significantly. Experts are quick to point out, however, the aging of the population is not “all about the baby boom.” Rather, rising life expectancy coupled with a reduced birth rate is driving a long-term change in the age composition of the U.S. population.

The U.S. Census Bureau forecasts continuing increases in life expectancy, from 79.5 years for a baby born in 2015 to 84.8 years for one born in 2060 (compared with 68 years for a baby born in 1950).   In addition, a National Research Council report projects that the average years of life remaining for males who reach age 65 will rise from 17.5 years in 2010 to 22.2 years in 2050; for females, these numbers will rise from 19.9 years in 2010 to 24.1 years in 2050.  Considerable debate exists, however, over how to project life expectancy and years remaining, considering the uncertain implications of developing trends such as the rise in obesity rates.

In addition to increasing life expectancy, researchers have explored the concept of “compression of morbidity,” meaning that people can live actively and largely free of disease and disability until shortly before death.  Although the topic is still the subject of debate, most research suggests that a compression of morbidity occurred in the 1980s and 1990s that has since leveled off.  As with life expectancy, it is unclear how to project compression of morbidity. Some research suggests that, compared with the cohort that preceded them, baby boomers are in poorer physical and mental health as they enter retirement and therefore will have higher rates of disability as they age.  Exactly how people will live their lengthened lives — with compressed or extended morbidity — has a significant effect on their ability to age in place.

Other demographic influences will shape the dynamics of aging in place in ways that are not yet fully understood. Experts project increasing ethnic diversity in the older population. The share of the population aged 65 and older who identify as Hispanic, for example, is expected to increase from 7 percent in 2010 to 20 percent by 2050.  Such diversity may add to the challenges of aging in place because ethnic and racial minorities may have different needs, preferences, or understandings regarding issues such as death or dementia.  Growth in the populations of ethnic and racial minorities that, because of socioeconomic differences, are more likely to encounter barriers to services, have a higher prevalence of disability, and have less wealth than whites of the same age will also shape the challenges of aging in place in the future.  According to a recent study by the Institute on Assets and Social Policy at Brandeis University, 76 percent of African American and 85 percent of Latino seniors “do not have sufficient financial resources to meet projected lifetime expenses.”

Although the financial circumstances of these African American and Latino seniors are especially insecure, the Center for Retirement Research’s National Retirement Risk Index predicts that 53 percent of all working households are “‘at risk’ of being unable to maintain their pre-retirement standard of living in retirement.  Stagnant incomes and unstable sources of wealth underlie this financial insecurity. Using 2007 dollars, the median income of people aged 45 to 54 rose only marginally between 1989 and 2007, from $62,100 to $64,200. Because these households hold most of their savings in home equity, their net worth is subject to the volatility of local and national housing markets.

Low incomes contribute to the financial insecurity of older households.  In 2011, the median income of households with at least one person over age 65 was $33,118, only 60 percent of the median income of younger households.  Much of this income is devoted to health care and housing. In 2010, for example, households enrolled in Medicare devoted nearly 15 percent of their annual spending to health care-related expenditures.  And in 2009, 48.1 percent of homeowners with a mortgage and 58.6 percent of renters aged 65 and older spent 30 percent or more of their income on housing and utilities.  These factors pressure the budgets of many older households and are particularly challenging for those with the lowest incomes, including the 8.7 percent of people aged 65 and older who were living below the federal poverty level in 2011.

These demographic changes and characteristics will have wide-ranging implications for society and policy. The aging population will strain the capacity of government programs that support seniors (and, by extension, federal, state, and local budgets) and will increase demand for affordable and age-appropriate housing.  At the federal level, the portion of the budget devoted to Social Security, Medicare, Medicaid, and interest payments on the federal debt increased from 44.4 percent in 2010 to a 61.8 percent in 2020.  This spending increase constricts funding for other federal programs, including those that support housing for the low-income elderly.  

State and local governments will continue to face heightened demand for services for older residents. Compounding these problems, the changing age structure will mean that fewer workers will support the growing number of retirees. Although older people may work longer in the future, according to current projections, only 3 potential workers (those aged 15 to 64) will exist for every 1 retiree (aged 65 and older) in 2050 compared with 5.2 in 2010 and 8 in 1950.

State and federal governments will be especially burdened by the expanding demand for Medicaid-funded services. Long-term care is a matter of particular concern for state policymakers because it constitutes nearly one-third of all Medicaid spending.  Although it constitutes a decreasing share of total expenditures, institutional care continues to account for more than half of Medicaid expenditures for long-term care services.  Helping seniors delay or avoid institutionalization by facilitating aging in place has the potential to significantly reduce public spending on long-term care. Kaye, Harrington, and LaPlante estimate that supporting a resident in a nursing home costs five times more than in a community setting.  Critical to unlocking this potential savings, then, is meeting the housing and health needs of seniors in their current homes and communities.

Home environments that do not meet the changing needs of aging residents can prevent successful aging in place. “In houses,” says Jon Pynoos of the University of Southern California, “we are still stuck with the old models that will not easily accommodate to the changes that can accompany getting older.”  In a national AARP survey, 23 percent of respondents aged 45 and older reported that someone in their household was very or somewhat likely to have difficulty getting around their home in the future.  Various modifications can make it easier for aging residents to navigate through and live in their homes, including brighter lighting, handrails, stair lifts, and accessible workspaces. New technologies are also being harnessed to help people age in their homes. A project developed at the University of Missouri, for example, helps caregivers monitor seniors in their homes using sensors to detect falls and other emergency situations and to track changes in functional ability. The sensor system, which includes monitoring of bathing and cooking activity as well as time spent in bed, has been tested in a community-based setting and is being developed for in-home use.

These home modifications can range in cost from a few dollars for a brighter light bulb to thousands of dollars for significant remodeling.  The National Association of Home Builders (NAHB) reports that 80 percent of aging-related home modifications are paid for out of pocket — a significant obstacle to aging in place for the poorest elderly, who both have the highest levels of disability and tend to live in older housing stock.  Some form of public assistance may be necessary to support modifications for this high-need population. The U.S. Department of Energy’s Weatherization Assistance Program, which makes homes more energy efficient to reduce utility costs for low-income families, could be of help to seniors as well as serve as a model for home modification programs that adapt housing for the low-income elderly.

A more cost-effective (although long-term) solution for promoting aging-friendly housing is to ensure that new construction includes accessible features and is designed with future modifications in mind, such as blocking for future railings and grab bars or stacking closets for a future elevator. Two design standards — visitable and universal — promote accessibility and provide benefits to users of all ages. On the lower end of the spectrum, visitability creates a standard of accessibility for disabled visitors, including zero-step entryways, wide doorways, and a first-floor bathroom. Universal design is a higher standard that would also include, for example, having a bedroom on the first floor. These design standards already incorporate many aging-friendly modifications and provide greater ease of access and use to people of any age and ability.

Successful aging in place depends on access to needed supports and services, both medical and non-medical. A number of current models connect seniors with services and amenities in their homes and communities, but these may not be sufficient to meet growing demand.

The primary means of connecting seniors to the support and care they need is through informal caregivers — friends, family, and neighbors — with just an estimated 5 percent of older people supported only by paid caregivers.  The AARP Public Policy Institute estimates that the economic value of unpaid caregiving reached a staggering $450 billion in 2009.   Research shows that informal caregiving allows seniors to delay or avoid institutionalization even as their need for care grows.

Although these findings support the assertion that informal caregiving can help seniors age in place, other research suggests that excessive caregiver stress often leads to admission of a care recipient to a nursing home.  Policymakers may be interested in supporting informal caregivers to reduce their stress. Studies show that such support should focus on teaching coping skills to deal with “problem behavior” of the care receiver, and they also indicate that additional supports may need to differentiate between caregivers who are adult children and those who are spouses.  Some existing programs, such as the United Hospital Fund’s Transitions in Care – Quality Improvement Collaborative, recognize the critical role of the family caregiver in the transition from institutional to home or community settings and aim to better integrate caregivers into the transition process through needs assessment and education.  

The stress of caregiving that now falls on many baby boomers may also have ramifications for their own health as they age. One study finds an association between caregiving and poor health behaviors among caregivers that puts their long-term health at risk.  Some studies also suggest that the baby boom cohort will be less likely to have a spouse or adult children to provide informal care and therefore will be more likely to require nursing home care.

Although nearly all seniors receive support from informal caregivers, some choose housing options that include paid caregiving. Continuing care retirement communities and assisted living facilities require seniors to move from their current residence, but they can allow seniors to remain in their communities and enter a housing arrangement that includes medical and support services. These options can offer more independence than a nursing home facility while still providing customized medical and daily living support as needed. In 2010, there were 31,100 such state-regulated residential care facilities nationally with a total of 971,900 beds. Of these facilities, 82 percent were private, for-profit institutions and 38 percent of them were chain affiliated.  But with a mean national monthly cost per resident of $3,550 in 2012, assisted living is unaffordable for many seniors.  Two alternative models that connect seniors with services in their current homes are naturally occurring retirement community support service programs (NORC SSPs) and Villages. (See “Community-Centered Solutions for Aging at Home” for more on these models for aging in place).

Services such as the Centers for Medicare and Medicaid Services’ (CMS) Home and Community-Based Services and Program of All-Inclusive Care for the Elderly also contribute to aging in place by supporting home- and community-based care and reducing unnecessary institutionalization.  As many as 5 percent of Medicare enrollees aged 65 and older who live in long-term care facilities have no functional limitations, suggesting that relatively modest interventions could mean the difference between staying at home and institutionalization.   One study finds that states that invest more in community-based services — home-delivered meals in particular — have fewer seniors with few or no functional limitation and little or no cognitive impairment in nursing homes.  The national average annual rate for a semiprivate room in a nursing home reached $81,030 in 2012, indicating that states can realize considerable savings by delaying or avoiding institutionalization.  In fact, a significant shift in Medicaid spending away from institutional long-term care has already occurred, with spending on home- and community-based care increasing from 13 percent in 1990 to 43 percent in 2009.  Federal initiatives including Medicaid waivers, Money Follows the Person, and the Community Living Program have helped states facilitate this shift, often called “rebalancing,” as well as other efforts to divert seniors from nursing homes.