Demographic Dip: Excuse or Imposing Reality? Irving Stackpole & John Spooner
How bad is it??
Retooling for the Next Generation John Spooner | Co-Chief Executive Officer
Life Span
Vitality
100%
1965 Age
25
2015 68
2050 80
92
Morbidity Compression: Live Long, Die Fast
Vitality
100%
Age
25
68
80
92
Health Span: Extending Wellness in Aging
Vitality
100%
Age
25
68
80
92
U. S. Senior Population: 2010-2050 Total
65+
75-84
2010
296,000,000
39,561,000
7,104,000
(2.40%)
5,180,000
(1.75%)
2020
325,600,000
52,857,000
9,768,000
(3.00%)
6,512,000
(2.00%)
2030
358,200,000
68,345,000
15,223,500
(4.25%)
9,850,500
(2.75%)
2040
393,900,000
74,984,000
17,725,500
(4.50%)
13,786,500
(3.50%)
2050
438,000,000
81,100,000
17,520,000
(4.00%)
17,520,000
(4.00%)
Pew Research Center: U.S. Population Project 2005-2050
85+
Beyond the Picket Fence‌
A NEW Senior is Emerging
TOPIC
RECENT PAST
NOW
FUTURE
• Housing • Services • Health Care
“Oh, I Didn’t Think I Would Like It, But I Loved It!”
• Housing • Hospitality • Wellness
Institutional Image HangOver
Consumer Acceptance Increasing
Demographics Double
Life Span/ Health Span
Public Health Terminology
Longevity and Morbidity Compression
Health Span: Focus on How Long One Lives Well
Attitude
Entitlement
Confusion
Consumer Activist
Directed Advice
Self-Directed
Engaged Self-Care
Job/Career
Career
Profession
CCRC
Market
Health
Employe es
TOPIC Hospitali ty Who Pays?
RECENT PAST High Resident Satisfaction was Enough
NOW • Ritz • Four •
• Training • Systemize
Season s Disney
d Expectati ons
FUTURE • Cross-Category Comparison • Fluid Expectations
Medicare/Insurance Co-Pay/Deductible
High Deductible
Average Age
• ILU: 78-85 • ALU: 80+ • HC: 80+
Convergence in Age
Longevity Blurs, Morbidity Defines
ILU/RLU
• Granite • Larger Apartments
• “Amenity Ladder” • Open Plan
SNF
AL
MS
HC and AL Converge
• Downsize Nursing • Shift to Rehab
• Expand AL AL and ILU Converge • Highly Competitive Most Recent Addition to Levels of Living
• Growing
• Double Masters • Super Fridge • Casual Living • Specialty HC • Rehab Spa • Specialty AL • Efee AL • Deregulation
• Growth Market into the Future
TOPIC
RECENT PAST
FUTURE
NOW
CONTRACT TERMS • “Continuu • Assisted m”
Terminolog • “Levels of Care” y
• CCRC • Independe
• Memory Care • Nursing Care
• CCRC • Residential
nt
Transfer s Changes in Terms Due to Changing Policy/Mark ets
• Defined • Sponsor Discretion • Cooperation Expected
Same
• Levels of Living • Levels of Service • Specifically Defined • Sponsor Discretion • Specific Acknowledgement by Resident/Advisors • Consequences for NonCooperation
• Specific Mention of • Not Mentioned • Right to Amend
LTC Risk • Types A, B, C Allocatio • Closed Insurance Pool n • High Refund
Contract • Traditional s
Unknown Future Changes in Health Care Delivery May Require Change
Same
• Modified • Defined • Resident Cost •
Sharing Closed Insurance Pool with High Deductibles
3-5 Alternates to Broaden Market
• Dynamic • Control Cost with Full •
Recapture Cross-Level Benefit Use
• Consumer Financial •
Profile Shift to “Asset Status”
TOPIC What’s Hot?
Traditiona l Family Compositi (U.S.on Census
RECENT PAST
NOW
• Social Accountability • Silver Tsunami
• ACO’s • Property Tax
(The Cleaver’s) 48% of WWII Generation
(Modern Family) 37% of Baby Boomers Generation
Exemption • Succession Planning
FUTURE • NFP Status • “Green” • Marijuana Use • Assisted Suicide • Digital Privacy (Kardashians) 25% of Millennium Generation
2013 Affluent Senior Households)
….…So,
The New Language of Senior Living 1. 2.
“Care” is being excised Evolving senior living language − − − − − − − − − −
Health span Age compression Flex spending Long-term support and services Levels of Living Levels of Service Support days Connected-care technology Service Excellence Apartment-for-life
Demographic Dip: Gravity is Unavoidable Irving Stackpole
How bad is it?? •
• •
Numbers Negativity Money
Realities
Occupancies are poor because • • • • •
The age qualified markets are declining Increased options / choices Negative perception The economy The role of “Intermediaries”
The need for change is URGENT
Currently ~83%
Currently ~ 87%
2016
Born 1930 85 yoa
2020 Born 1934 85 yoa
22
Stackpole & Associates, Inc.
Negativity?
Sector NOT thought of as the valuable resource it is … They are seen as prisons – awful places – –
–
23
The “F” word “Don’t want to put / place mom in a nursing home.” “I’d rather be dead.”
Deep metaphor of negativity Stackpole & Associates, Inc.
Responding to a declining market Defend,
protect & fortify
• Manage to Loyalty Increase
Productivity / Efficiency
Innovate Differentiate
25
Efficiency Technical, Productive, Allocative – Technical Maximum
improvement from resources
– Productive Best
health outcome for given costs or reduction in cost for the same outcome – Allocative
Best
26
outcomes for society
Stackpole & Associates, Inc.
Facts of Life
The age qualified market is shrinking
Intense cultural negativity
Continued pressure on payments
Continued pressure on utilization
Where is the demand?
Demand for Arthroplasty 4000 3500
3481
Number of patients (x 1,000)
3000
2500
Primary total hip arthroplasty
We are Here Primary total knee arthroplasty
2000 1520
1500
Revision total hip arthroplasty
1000 500
450 209
0 2000
29
38.3 40.8
2005
663
572
384
253 55.3 47.8
2010
2015 Year
2020
Revision total knee arthroplasty
268
121 67.6
96.7
2025
2030
2035
Demand for ARD Care
Medicare/Medicaid Costs per year (billions of dollars) 1,600
1,400
Inflection Point 1,200
We are Here 1,000
800
600
400
200
2010
2015
2020
2025
2030
QUESTIONS???