Seniors, We Have a Problem

by Wyoming Liberty Group Staff

In the United States, it is estimated that 52% of households over the age of 65 have no retirement savings. What is more alarming is that a full 27% of Americans have neither retirement savings, nor a defined-benefits plan, meaning they are wholly unprepared for the mountain of expenses that faces almost everyone following retirement. It is estimated that, on average, Americans will face a lifetime cost of $266,000 after they retire. Households that do have retirement savings only have of $148,000, leaving them $118,000 short on average.

The financial challenges facing seniors are shared by all Americans, but they are being exasperated in Wyoming, because of our aging population and a lack of young people to replenish their medical benefits. In Wyoming, the most pressing issue for seniors is that there simply are not enough young people to continue paying for their benefits. This is best demonstrated by our lowering "age-dependency ratio", which is the number of working age adults relative to the number of seniors in the state. In 2017, that ratio was 16.8 adults to seniors, and it is expected to lower to 10.1 adults for every senior by the year 2030 – a sharp downward trend.

This was one of the many striking predictions made in a report from the Wyoming Department of Health ("DoH") that highlighted the issues facing our long-term health care in the state. Among the other pressing issues put forth by the DoH was that our aging population is increasing at a dramatic rate, while the number of young people either remains constant or lowers in the same timeframe (2017-2030).

The report predicted that the aging population will increase from 92,240 people above the age of 65 to 138,143 people by the 2030 mark. Keep in mind that seniors are among the most costly healthcare beneficiaries, with seniors accounting for 26% of Medicaid's spending, despite only making up 5% of the beneficiary population. That 26% utilization rate is 3% higher than the national average, which serves as further proof that Wyoming is in dire straights when it comes to long-term care spending.

In terms of exact costs, Wyoming stands alone with the highest cost per aged Medicaid enrollee in the nation, with a price tag of $42,921 per enrollee. The researchers summarized this long-term care crisis by presenting two spending model scenarios that predict what seniors could cost the state of Wyoming by the year 2030. In their low-end estimate, they predicted that seniors could cost Wyoming $186 million per year. Their high-end prediction put the number at a heart-stopping $312 million per year. At the moment the researchers started their project (2017), the Medicaid price tag for seniors was at $130 million, more than 1/5 of the total Medicaid budget (about $555 million).

The bottom line is that we have a moral obligation to ensure that our aging population is as comfortable as possible after they retire. You have to ask yourself if the government has presented the best avenue for long-term care, or if a private solution should be given a chance in Wyoming.