Learn the Adult Disability Dependency Ratio, because bad measures of ageing can lead to bad policies!

Article By: Warren Sanderson and Sergei Scherbov

In 1957, the life expectancy of a 65 year old Canadian was 14.6 years. By 2007, it had risen to 20.0 years and more recently, it has been rising even faster. It is not difficult to imagine that by mid-century, 65 year old Canadian will have a life expectancy of around 30 years. Canadians are living longer and healthier lives than ever before and this marvelous trend is likely to continue.

While evidence of this abounds, demographers and policies have often failed to take it into account. Ignoring improving health and longevity can lead to erroneous policies. One of the reasons that these increases have been ignored is that until recently there have not been accepted methods for including them in measures of ageing.

We have been working for a number of years on remedying this situation and have published articles in Nature and Science as well as other journals on this subject. Our most recent paper, entitled “Remeasuring Aging” was published in Science in September, 2010.

Ageing is often measured using something called the Old Age Dependency Ratio, which is the number of people 65+ years old divided by the number of people 15 to 64 years old. It takes neither improvement in health or increases in longevity into account. As people at age 65 enjoy longer and healthier lives, putting them into the category of old age dependents becomes more and more anachronistic.

When the Old Age Dependency Ratio is forecasted for Canada it rises from a level of 0.22 in 2005-10 to 0.47 in 2045-50. The fact that this ratio more than doubles over 40 years is what scares many people about the speed of ageing and leads to recommendations that the health care system needs to be modified. But this is the wrong ratio to use! We have invented two new ratios which reflect the ongoing improvements in health and longevity. We call one of them the Prospective Old Age Dependency Ratio. It takes forecasted increases in life expectancy into account. When we forecast it for Canada, we see a much smaller increase.

In our Science article, we introduced a measure that we call the Adult Disability Dependency Ratio. It looks at the number of people with serious disabilities regardless of age compared to the number of adults without these disabilities. Forecasts of increases in health care costs are more closely correlated with the Adult Disability Dependency Ratio than with the conventional Old Age Dependency Ratio.

When we look at the Adult Disability Dependency Ratio for Canada it rises only from 0.09 in 2005-2010 to 0.11 in 2045-50. This is hardly as scary as the large increase in the Old Age Dependency Ratio and more appropriate to use when forecasting health care costs in Canada.

Bad measures of ageing can lead to bad policies. Fortunately, there are now better alternatives for policy-makers to use.

Recommended Reading:

Warren Sanderson and Sergei Scherbov. “Rethinking Age and Aging” Population Bulletin 63(4) December, 2008: 3-16.

Warren Sanderson and Sergei Scherbov. “Remeasuring Aging“ Science . 329 (5997). September 10, 2010: 1287-1288.

Posted: July 29, 2011
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