Newsflash! Another newspaper announces that Canada’s aging population will bankrupt us. U.S. economist Edward Yardeni was quoted warning, “The new Malthusian nightmare is approaching,” and described the demographic scenario as none other than “dismal”.
So now living longer is a bad thing! That is the sum total of a simplistic analysis that is popular today. And for some reason, commentators think that only other people are aging. The pernicious result of this kind of dissociative thinking is that public policy – and attitudes – will continue to kick older Canadians to the curb. Pile on if you want but don’t come calling when it’s your mother who needs a doctor with expertise in geriatrics or access to home care so that she doesn’t have to wait an average of two years to get into a nursing home.
In an article written for the same newspaper a year prior entitled “The Medicare Myth that Refuses to Die,” John Lorinc examined this notion, one that healthcare economist Robert Evans has termed “a zombie”: a discredited idea that will not die.
According to Professor Evans, “very little of the increase in health-care costs will be due to the fact that there will be more old people around… The demographic story gets told over and over again because it’s simple,”
Other factors such as increasing drug costs and salaries, increased uptake and use of services and ever improving and expensive technology have and will continue to account for the majority of increased health care costs.
But don’t take our word for it. The Health Council of Canada, which actually analyzes healthcare costs, has also declared “the persistent belief that our aging population will overwhelm the healthcare system is a myth.” To read more on this please read their Value for Money Report.
The population is indeed aging and the challenge is to do things better and smarter – not to keep doing the same things but now with resentment. The healthcare budget will continue to grow exponentially – but not because the population is aging. People are living longer but also healthier lives. Everyone is using the healthcare system more and the treatments are much more costly. We are already living longer, healthier lives, let’s keep promoting cost effective medical alternatives like preventative healthcare, more support for home care and increased support for family caregivers.
The smarter options are right in front of us if we can look past the blinding presumptions. Tap into the productivity and expertise of older workers but get rid of mandatory retirement and insurance coverage that ends at age 65. Stop wasting untold billions on outmoded methods of healthcare delivery and get going on primary health teams, electronic health records, better home care and support for family caregivers. Set up a universal pension plan so that people can save adequately for their own retirement.
Another challenge will be to ensure that public policy promotes sustained growth in productivity. The best way to do this is by fostering the knowledge industries and taking advantage of the human capital the boomers have amassed through training, education and life experience. The Malthusian catastrophe didn’t account for the economic value of innovation. Some two hundred years later let’s be a little more insightful.