The Challenge

Currently, our society is on the brink of a healthcare crisis. An estimated 78.2 million baby boomers are marching towards a healthcare system which is not prepared for them. They will soon require a level of care that they have never needed before—at a cost they never dreamed of. Many will suffer from multiple chronic illnesses, see several different medical specialists, and take more than 20 different prescription medications a day. And as medical advances continue to extend life spans, they will require long-term care which the majority of them will almost certainly not be able to afford. Consider the following grim statistics:

• Between now and 2030, the country's 65-and above population will increase four times faster than the general population.
• At the same time "oldest of the old" population—those 85 and above—will rise even faster.
• The elderly use 46 percent of all hospital inpatient days and account for 36 percent of all hospital admissions, which is three times their percentage of the population.
• Assisted living facility occupancy rates in are at 95 percent—essentially, they are at capacity. Yet development of all types of senior housing including nursing homes has slowed.
• One in three persons who reach 65 will spend time in a nursing home, and the national average nursing home costs nearly $67,000 a year.
• Approximately six of ten retirees derive more than half their income from Social Security. For 21 percent, Social Security is all the income they have.
• Hospital costs are skyrocketing for those conditions most typical of elderly patients. A congestive heart failure admission was 48 percent costlier in 2004 than in 1997. Average cost of a hospital stay for stroke or osteoarthritis was $2,000 more in 2004 than in 1997.