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Institute of Medicine (US) Committee on the Future Health Care Workforce for Older Americans. Retooling for an Aging America: Building the Health Care Workforce. Washington (DC): National Academies Press (US); 2008.

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Retooling for an Aging America: Building the Health Care Workforce.

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2Health Status and Health Care Service Utilization


Older adults use far more health care services than do younger groups. Although older adults vary greatly in terms of health status, the majority of them have at least one chronic condition that requires care. Older adults also vary in their demographic characteristics, which leads to differences in their demand for and utilization of health services. Projections of the uti lization of health and long-term care services often suffer from important methodological limitations, but all projections indicate that the demand for services for older adults will rise substantially in the coming decades, which will put increasing pressure on Medicare and Medicaid budgets and on the capacity of the health care workforce to deliver those services.

Over the coming decades, the total number of Americans ages 65 and older will increase sharply. As a result, an increasing number of older Americans will be living with illness and disability, and more care providers and resources will be required to meet their needs for health care services. In order to design effective models of care delivery and prepare a health care workforce to serve this future population, one needs to understand both the projected health status of this population and the demand for health services under the current system. Such an understanding will help identify what changes will need to be made in the health care workforce (in terms of its size, distribution, and training) to fulfill its looming charge.

This chapter begins with an overview of the current health status and health services utilization patterns of older adults. Older adults today en counter a number of health challenges as they age and, on average, use a relatively large volume of health care services. However, the older adult population is quite heterogeneous, with individual members displaying an array of health statuses and needing a variety of services. Box 2-1 presents some hypothetical examples to illustrate the diversity of the current older population by describing several typical older adult profiles.

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BOX 2-1

Typical Profiles of the Older Adult Population. Mrs. S is a 75-year-old divorced woman who is retired from her job as an executive secretary and now lives in a retirement community where she plays golf three times a week. She lives without assistance (more...)

The chapter continues with a review of projections of the future health status and utilization patterns of older adults as well as a description of the assumptions and limitations of those projections. Although it is difficult to predict with accuracy the number and types of health services that will be demanded by older adults, it is clear that the total volume of health and long-term care services needed in the future will be much greater than the volume provided today.

The chapter concludes with a brief discussion of the implications of these projections. If current patterns continue, the financial and human resources required to meet the projected demand for services will be strained well beyond today’s supply.


The health status of older Americans has improved over the past several decades (Crimmins, 2004). Older adults today have greater longevity and less chronic disability than did those of previous generations (Federal Interagency Forum on Aging Related Statistics, 2006; Manton et al., 1997, 2007). While these improvements appear to be related in part to declines in smoking rates and better control of blood pressure (Cutler et al., 2007), the causation has not been conclusively proven. Studies also show improvements in the reported physical functioning of older adults, such as the ability to lift, carry, walk, and stoop (Freedman et al., 2002), as well as declines in limitations in instrumental activities of daily living (IADLs), such as shopping for groceries, preparing hot meals, using the telephone, taking medications, and managing money. The evidence for declines in limitations in activities of daily living (ADLs), such as eating, bathing, dressing, using the toilet, transferring (such as from bed to chair), and walking across the room is less strong (Freedman et al., 2004a). Finally, the percentage of older adults who self-report their health as “fair” or “poor” has declined (Martin et al., 2007). Despite these improvements, however, older adults still do have high rates of chronic disease and disability, particularly as compared to younger adults (Table 2-1), and disease prevalence has risen as longevity has increased (Crimmins, 2004).

TABLE 2-1. Indicators of Health Status, by Age Group, 2006 (Percent).


Indicators of Health Status, by Age Group, 2006 (Percent).

It is important to note that if one looks just at aggregate data, such as those on disease prevalence (Table 2-1), it obscures important differences in the health status among subgroups of older adults. Many older adults are actually in very good health, for example—44 percent of adults in the 65-74 age range and 35 percent of adults 75 and older report their health status to be “very good” or “excellent” (Pleis and Lethbridge-Çejku, 2007). And a sizable minority, approximately 20 percent, have no chronic illnesses (AOA, 2006; CDC and Merck Company Foundation, 2007). These healthier older adults tend to be community-dwelling individuals who require only preventive and episodic health services.

On the other hand, a large majority of older adults (approximately 82 percent) have at least one chronic disease that requires ongoing care and management, with hypertension, arthritis, and heart disease being the most common (Table 2-2). These chronic conditions damage older adults’ quality of life, they contribute to a decline in functioning, and they have become the primary reason why older adults seek medical care (Hing et al., 2006). In fact, Medicare beneficiaries with more than one chronic condition visit an average of eight physicians in a year (Anderson, 2003). An analysis of Medicare expenditures shows that the 20 percent of Medicare beneficiaries with five or more chronic conditions account for two-thirds of Medicare spending (Partnership for Solutions National Program Office, 2004). Data from the 2001 Medical Expenditure Panel Survey show that almost all Medicare spending and 83 percent of Medicaid spending is for the provision of services to individuals with chronic conditions.

TABLE 2-2. Chronic Disease Prevalence, Cost, and Physician Use Among Medicare Beneficiaries.


Chronic Disease Prevalence, Cost, and Physician Use Among Medicare Beneficiaries.

In addition, many older adults experience one or more geriatric syndromes, clinical conditions common among older adults that often do not fit into discrete disease categories. Examples include delirium, depression, falls, sensory impairment, incontinence, malnutrition, and osteoporosis. The syndromes tend to be multifactorial and result from an interaction between identifiable patient-specific impairments and situation-specific stressors (Flacker, 2003; Inouye et al., 2007). Geriatric syndromes are prevalent conditions even among community-dwelling older adults and can have a substantial effect on older adults’ quality of life (Cigolle et al., 2007). Estimates of incontinence, for example, range from 17 percent to 55 percent in older women and from 11 percent to 34 percent in older men. Almost half of older men and 34 percent of older women (ages 65 and older) report trouble hearing.

Although estimates vary across surveys, data from the 2002 Health and Retirement Study indicate that 27 percent of community-dwelling adults ages 65 and older (8.7 million people) need assistance with one or more ADLs or IADLs (Johnson and Wiener, 2006). Approximately 6 percent of older adults living in the community (2.0 million people) are severely disabled, reporting difficulty with 3 or more ADLs (Johnson, 2007). This group of older adults requires more intensive care in the home, particularly personal-care services.

Approximately 6.5 percent of older adults live in a long-term care facility. The majority, approximately 1.45 million, live in nursing homes, and approximately 750,000 live in other residential-care settings that provide some long-term care services (Spillman and Black, 2006). Those over age 85 are much more likely to live in a long-term care setting than younger older adults. In fact, those over age 85 are four times as likely to live in a nursing home as those aged 75 to 84 (Jones, 2002). On average, older adults living in nursing homes and residential care facilities tend to have more severe disabilities than older adults living in their own private homes, although more disabled older adults live in the community than in long-term care settings. Residents of long-term care facilities often have the additional need for symptom management and palliative care, that is, for noncurative care that is focused on alleviating physical symptoms and addressing psychological, social, and spiritual needs (Moon and Coccuti, 2002).

Approximately 80 percent of deaths in the United States occur among older adults (Kung et al., 2008). The leading causes of death among older adults are diseases of the heart, malignant neoplasms, cerebrovascular diseases, chronic lower respiratory diseases, and Alzheimer’s Disease (NCHS, 2007). Studies indicate that older adults follow different trajectories of dying (IOM, 1997). Some have normal functioning but then die suddenly. Others die after a distinct terminal phase of illness, such as occurs with many types of cancer. Still others have a slower decline with periodic crises before dying from complications, as is the case with stroke or dementia. On average, about one-fourth of Medicare outlays occur in the beneficiary’s last year of life, with 38 percent of beneficiaries spending at least some time in a nursing home and 19 percent using hospice services (Hogan et al., 2001). About half of Medicare patients who die from cancer use hospice services in the last year of life. Deciding whether to use palliative care or curative treatment for illness during these times is a very personal choice and depends on the individuals being affected (Moon and Coccuti, 2002).

Mental Health Conditions

Vulnerability to mental health conditions tends to increase as older adults age and become more likely to encounter stressful events, including declines in health and the loss of loved ones. Approximately 20 percent of adults ages 55 and older have a mental health condition, the most common being anxiety disorders (e.g., generalized anxiety and panic disorders), severe cognitive impairment (e.g., Alzheimer’s disease), and mood disorders (e.g., depression and bipolar disorder) (AOA, 2001). Cognitive impairment with no dementia (CIND) has been described as the intermediate state between normal cognitive function and dementia, a chronic illness characterized by a decline in memory and other cognitive functions. The prevalence of dementia increases with age, escalating from about 5 percent among individuals aged 71 to 79 to about 37 percent among those aged 90 and older (Plassman et al., 2007). In 2007, 42 percent of adults 85 years or older had Alzheimer’s disease (Alzheimer’s Association, 2007), although estimates have varied somewhat. Additionally, suicide rates for men 65 and older are higher than any other age group and are more than twice the national rate for all persons (NCHS, 2007).

Mental health conditions are also more prevalent among community-dwelling older adults with ADL and IADL limitations. In 2002 approximately 31 percent of persons with disabilities and 45 percent of severely disabled persons reported depressive symptoms, and 15 percent of older adults with disabilities and 25 percent of severely disabled older adults had cognitive impairments (Johnson and Wiener, 2006). The prevalence of mental health conditions is even higher among nursing home residents. In 2005 nearly half of nursing home residents had dementia, and 20 percent had other psychological diagnoses (Houser et al., 2006).

One reason for these trends may be that mental and physical health are interrelated (New Freedom Commission on Mental Health, 2003). While the direction of causality between the two remains unclear, the correlation between them has been well documented. Persons with dementia and CIND have more serious comorbidity than those without cognitive impairment (Lyketsos et al., 2005). Physically disabled adults report higher rates of mental health conditions. People with depressive symptoms often experience higher rates of physical illness, health care utilization, disability, and an increased need for long-term care services (Federal Interagency Forum on Aging Related Statistics, 2006; Ormel et al., 2002). In addition, depression in later life is associated with poor health habits and diminished adherence to treatment for co-existing medical disorders. Among older adults, the combination of heavy alcohol or substance use with depressive symptoms has been shown to be associated with high risk for suicidal ideation and poor physical well-being (Bartels et al., 2006a,b).


Older adults have much higher rates of health services utilization than do non-elderly persons. Although they represent about 12 percent of the U.S. population, adults ages 65 and older account for approximately 26 percent of all physician office visits (Hing et al., 2006), 35 percent of all hospital stays (Merrill and Elixhauser, 2005), 34 percent of prescriptions (Families USA, 2000), and 90 percent of nursing home use (Jones, 2002). Utilization data for several acute-care services are displayed in Table 2-3.

TABLE 2-3. Health Services Utilization by Age Group, 2005.


Health Services Utilization by Age Group, 2005.

On average, older adults visit physicians’ offices twice as often as do people under 65, averaging 7 office visits each year and totaling approximately 248 million visits in 2005 (NCHS, 2007). Older adults are more likely to visit a physician’s office for a chronic problem or for a pre- or post-surgery visit, but they are less likely than younger persons to seek preventive care. In 2004 the most common reasons for older adults to make office visits were all related to chronic conditions: hypertension, malignant neoplasms (i.e., cancer), diabetes, arthropathies and related disorders (i.e., problems with joints), and heart disease (Hing et al., 2006). Older adults frequently made visits to internal and family-medicine physicians, but more than half of their visits were to specialists (NCHS, 2007). Older adults also tend to visit multiple physicians. In 2003 half of Medicare patients visited between two and five different physicians, 21 percent visited six to nine physicians, and 12 percent visited ten or more different physicians (MedPAC, 2006).

Although there are many specialists for which older adults constitute a large percentage of visits (e.g., 35 percent for internal medicine, 30 percent for neurology), older adults account for only 9 percent of visits to psychiatrists (ADGAP, 2007). The stigma associated with seeking mental health services presumably contributes in part to this low utilization, but limited coverage by Medicare for psychiatric services is also a reason (Manderscheid, 2007). Medicare requires a 50 percent copayment for outpatient mental health services as compared with only 20 percent for most other outpatient services.

Older adults also receive a considerable amount of ambulatory care at hospital outpatient departments. Older adults accounted for more than 13 million visits to hospital outpatient departments in 2004, not including visits to emergency departments (EDs); the reasons for these visits were similar to those for visits to office-based physicians (Middleton and Hing, 2006).

Older adults account for a disproportionate share of emergency services. In fact, the rate of use of emergency medical services (EMS) by older adults is more than four times that of younger patients, and older adults account for 38 percent of all EMS responses (Shah et al., 2007). Between 1993 and 2003 ED visits by patients between the ages of 65 and 74 in creased by 34 percent, and adults over age 65 had the greatest increase in visit rate of all age groups (Roberts et al., 2008). In 2004 older adults made 15.7 million visits to EDs, which accounted for 14 percent of all ED visits. More than one-third of older adult ED patients arrived by ambulance, using ambulance transport at more than double the rate of ED patients as a whole (McCaig and Nawar, 2006). Despite older adults’ higher rates of using emergency services, many EDs are not prepared to address the unique needs of older patients (Hwang and Morrison, 2007; Wilber et al., 2006). These EDs do not have the expertise, equipment, or policies to provide optimal care for older patients.

Once they have been treated, older adults are more likely to have an overnight hospital stay and also more likely to have multiple overnight hospitalizations. In 2002 older adults accounted for more than 13 million inpatient discharges. The most common inpatient diagnoses included coronary atherosclerosis (hardening of the heart arteries and other heart disease), congestive heart failure, and pneumonia (Merrill and Elixhauser, 2005).

Forty-two percent of older adults receive some post-acute care services after discharge from the hospital. Approximately 27 percent of older adults are discharged to another institution, such as a skilled nursing facility (SNF) or rehabilitation center; another 15 percent receive home health care (AHRQ, 2007). Medicare covers up to 100 days (20 days of full coverage and 80 days of partial coverage) in a SNF after a hospitalization of at least three consecutive days (MedPAC, 2007b). The average length of SNF stays covered by Medicare in 2005 was 26 days (MedPAC, 2007a). Overall, almost 3 million Medicare beneficiaries received home health services in 2006, including skilled nursing, physical therapy, speech-language pathology services, aide service, and medical social work (MedPAC, 2007a). Medicare provides home health care to homebound beneficiaries needing part-time (fewer than 8 hours per day) or intermittent (temporary but not indefinite) skilled care to treat their illness or injury. Personal care and other non-skilled needs are not covered by Medicare.

Older adults are especially vulnerable as they transition between types of care. A lack of coordination among providers in different settings can lead to fragmentation of care, placing older adults at risk for absence or duplication of needed services, conflicting treatments, and increased stress (Parry et al., 2003). For example, medication changes, which are a common cause of adverse drug events, are not unusual in the transition from hospital to long-term care settings such as nursing homes and private home settings (Boockvar et al., 2004; Foust et al., 2005; Levenson and Saffel, 2007). Incomplete procedures during hospital discharge may also be linked to unnecessary rehospitalizations (Halasyamani et al., 2006; Kripalani et al., 2007). This type of fragmented care can also result from a lack of coordi nation among providers who concurrently care for older adults in different settings, exemplifying the failure of the health care system to meet the standards of quality (most notably safety, efficiency, and patient-centeredness) as described in the IOM’s Crossing the Quality Chasm (IOM, 2001). Coordination of care and the use of interdisciplinary teams, is discussed in more detail later in this report.

Long-term care services include health and personal services provided to chronically disabled persons over an extended period of time. Estimating the total amount of long-term care services received by older adults is difficult because utilization data are not often collected in a consistent manner across settings or care providers. Just over 60 percent of disabled older adults living in the community obtain some long-term care services, most commonly basic personal-care services and help with household chores, averaging about 177 hours per month (Johnson and Wiener, 2006). Informal caregivers provide the vast majority of these services. Approximately 5.7 million older adults received some unpaid services in 2000 (Johnson et al., 2007). Only about 18 percent of long-term care services provided to disabled older adults in their homes are delivered by formal paid sources. Medicaid accounts for about 41 percent of total long-term care expenditures (including non-elderly persons), while Medicare and out-of-pocket costs each account for 22 percent of expenditures (Kaiser Commission on Medicaid Facts, 2007).

As noted earlier, while approximately 1.45 million older adults live in nursing homes, another 750,000 older adults live in alternative residential care facilities, which provide housing and services outside nursing homes for those unable to live independently (Spillman and Black, 2006). In fact, assisted-living facilities have been the most rapidly expanding form of residential care for older adults (Maas and Buckwalter, 2006). At the same time, the percentage of older adults living in nursing homes declined from 21 percent to 14 percent between 1985 and 2004, consistent with the preferences of older adults to live in the community (Alecxih, 2006b). While the Veterans Health Administration (VHA) allots 90 percent of its long-term care resources toward nursing homes, about 56 percent of formal long-term care service recipients receive community-based care (Kinosian et al., 2007).

In 2005 about 870,000 Medicare beneficiaries received hospice care, accounting for $7.92 billion in total Medicare payments (OIG, 2007). Twenty-eight percent of these beneficiaries received some hospice care in a nursing facility.

In addition to their increased needs for assisted housing and other types of care, older adults account for a disproportionate share of prescription and over-the-counter medications (ACCP, 2005). They consume 34 percent of all prescriptions dispensed and account for about 40 percent of every dollar spent on prescriptions (Families USA, 2000). According to physician office records and hospital outpatient records, the most common medications used by older adults in 2004-2005 included anti-hypertensives (133.3 drugs per every 100 older adults), cholesterol control drugs (128.1), non-narcotic analgesics for pain relief (104.7), and diuretics for high blood pressure and heart disease (95.4) (NCHS, 2007). In 2002, prior to the implementation of Medicare Part D, the average Medicare enrollee aged 65 and older filled 32 prescriptions (including refills), but that number rose dramatically for individuals with greater numbers of chronic conditions. On average, enrollees with three or four chronic conditions filled an average of 44 prescriptions per year, and those with five or more filled 60 prescriptions per year (Federal Interagency Forum on Aging Related Statistics, 2006).

Besides the traditional forms of health care discussed so far, surveys on the use of complementary and alternative medicine (CAM) estimate that anywhere from 30 percent to 88 percent of older adults use some form of CAM. Studies often vary in terms of which forms of CAM are examined. According to data from the National Health Interview Survey, prayer for health is among the most common forms of CAM practiced among older adults (Barnes et al., 2004). Data from the Health and Retirement Study, which did not examine prayer, found that the most common forms of CAM used by older adults included dietary supplements (65 percent) and chiropractic services (46 percent), though personal practice (breathing exercises and meditation), massage therapy, and herbal supplements were also commonly used (Ness et al., 2005).

There are also a number of different types of providers, such as nurse practitioners, social workers, psychologists, dentists, and pharmacists, for which utilization data have not been discussed in this section. Visits to these providers are typically not captured by national surveys of older adults, but the numbers are likely to be considerable.


The data presented above mask important differences in the health status of and the health care service use by older adults in various demographic categories, including sex, race, and socioeconomic status. For example, women and men face different challenges in maintaining their health and have different patterns of service utilization. Men have higher rates of heart disease, cancer, diabetes, and emphysema and have more inpatient hospital stays than women (Robinson, 2007). On the other hand, women have higher rates of osteoporosis, arthritis, asthma, chronic bronchitis, and hypertension, and women are more likely to report depressive symptoms (Federal Interagency Forum on Aging Related Statistics, 2006). Because women have longer life expectancy than men and greater age-adjusted dis ability rates (NCHS, 2007), women are more likely to live alone, and they use more post-acute care services and long-term care services than men.

Much research has been conducted on the disparities in health status between non-Hispanic whites and others. According to an analysis by Hayward and Heron that studied adults of all ages, Native Americans between the ages of 30 and 34 have a disability rate of 12 percent, but the disability rate does not become that high among blacks until around age 37, not until ages 50 to 54 for whites and Hispanics, and not until age 60 for Asian Americans (Hayward and Heron, 1999). Their data for both sexes combined indicate that Asian Americans exhibit the lowest rates of disability, the longest life expectancy, and the fewest years lived in poor health; black populations have the shortest life expectancy, and a high proportion of those years are lived with a chronic health problem. Black populations have higher prevalence rates of stroke, diabetes, and hypertension than white populations (IOM, 2004). Whites, however, are more likely to report cases of cancer and chronic lung disease.

To examine these issues among older populations, the committee commissioned a paper to explore the topic. That paper reported many examples of disparities among older adults of differing ethnic backgrounds. For the most part, illness and poor health were more common among minority groups (those not classified as non-Hispanic white) than among non-Hispanic whites. The 2000 Census found, for example, that approximately 49 percent of Hispanic older adults and 53 percent of non-Hispanic black older adults reported a limitation or disability, versus 40 percent of non-Hispanic white respondents (Freedman et al., 2004b). Older non-Hispanic white adults (40 percent) and Asians (35 percent) are more likely to report being in excellent or good health than are older Hispanics (29 percent), American Indians/Alaskan Natives (28 percent) or African Americans (25 percent) (AOA, 2006).

Although minorities tend to be in poorer health than non-minorities, they also tend to use health services less frequently (AHRQ, 2006; Damron-Rodriguez et al., 1994). A review by Gornick found that African American beneficiaries used fewer preventive and health-promotion services (e.g., influenza and pneumococcal vaccines) than white beneficiaries, used fewer diagnostic tests (e.g., colonoscopy), and underwent more surgical procedures associated with poor management of chronic disease (e.g., lower limb amputations) (Gornick, 2003). Despite their less frequent use of many acute-care services, African Americans tend to use nursing homes at higher rates than white older adults, reversing a historical trend (NCHS, 2007). They are also more likely to experience preventable adverse events or complications of care from hospitalization (AHRQ, 2005).

Some of the disparities in health status and utilization by race and ethnicity may be attributable to differences in income. An inverse relation ship exists between mortality and income (McDonough et al., 1997), and older adults living below the poverty level are more likely to have multiple chronic conditions than those at higher income levels (NCHS, 2007). Among older adults who require medical attention, wealthier individuals are more likely to use health care services than are lower-income individuals (Chen and Escarce, 2004). And while today’s older adults are wealthier than previous generations, their increased life expectancy may lead to less economic self-sufficiency in their later years than previous generations, leading to worse health status for the oldest of adults.

Socioeconomic factors may play an even larger role than race and ethnicity with regard to differences in the use of preventive services (Leatherman and McCarthy, 2005). For example, low-income older adults are less likely to receive a mammogram, colonoscopy, or influenza vaccination than are high-income older adults. Similarly, the use of preventive services is more common among those with supplemental coverage than among dually eligible older adults. Still, the vast literature detailing the relationship between cultural background and health shows that cultural disparities in health status and utilization persist after controlling for other factors, such as income level (AHRQ, 2005; IOM, 2002). All of these differences demand examination of whether the health care system for older Americans is equitable according to the standards set by the IOM report Crossing the Quality Chasm (IOM, 2001).

Income, gender, and race and ethnicity are but a few of the demographic characteristics that influence health status and health utilization. Research has also identified differences based on marital status, level of education, geographic location, and other factors (Freedman et al., 2004b; Johnson and Wiener, 2006; Martin et al., 2007; Schoeni et al., 2005). For example, Medicare beneficiaries with limited English proficiency are less likely to have access to a consistent source of care and less likely to receive important preventive care than Medicare beneficiaries who speak English fluently. Married older adults are less likely to report a limitation or disability than those who are widowed, divorced, or never married, and rates of limitations and disabilities decline with years of education. Studies have also found differences in health status and utilization based on geography. Older adults living in rural areas are more likely to rate their health as “fair” or “poor” than are those in urban areas, and those in rural areas have higher rates of chronic illness, disability, and mortality (Brand, 2007). The geographic distribution of older adults also affects workforce needs because different regions have differing needs for geriatric services. In 2006 older adults accounted for 12.5 percent of the total U.S. population, but this percentage ranged from 6.8 percent of the population in Alaska to 16.8 percent of the population in Florida. (See Chapter 4 for more on the effect of geographic distribution on the professional health care workforce.)

Finally, certain subgroups of older adults may have particular health needs. For example, veterans are twice as likely to commit suicide as the general population (Kaplan et al., 2007). Posttraumatic stress disorder and traumatic brain injury are sources of high morbidity for veterans returning from the present-day conflicts in Iraq and Aghanistan as well as for Persian Gulf War-era veterans (Rosenheck and Fontana, 2007; Warden, 2006). As these veterans age, they will likely have persistent and unique health care needs.


This section begins with a brief review of population projections, perspectives on future technology and preferences for care, and simple projections of health status and utilization. Next is an examination of three relatively complex models that were developed by RAND, the Lewin Group, and the Urban Institute to simulate future health status and health care utilization. Many of the projections discussed in the following sections focus on future dates other than the 2030 target date chosen by the committee, but the projections still serve the overall purpose of presenting a picture of the expected need for services and expected utilization rates if patterns of care for older adults continue on the current trajectory.

The Elderly Population

Between 2005 and 2030 the population of older adults is expected to almost double, from almost 37 million to 70 million (U.S. Census Bureau, 2000), although the need for health services may not rise in direct proportion. During that time, a number of factors are likely to alter the future health status and patterns of utilization among older adults, making projections of health status and utilization uncertain. As discussed previously, health status and utilization patterns vary according to certain demographic characteristics, and the future older adult population will look somewhat different from today’s older adults (Box 2-2).

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BOX 2-2

A Profile of the Future Medicare Population. The Medicare Payment Advisory Committee (MedPAC), recognizing that future Medicare beneficiaries will likely have different characteristics than today’s beneficiaries, conducted a project to develop (more...)

It has been estimated that minority groups will make up a much larger proportion of older adults in the future. The current population aged 65 and older is less diverse than the population currently aged 40 to 64 (Table 2-4), implying that older adults in 2030 will be a more diverse group than older adults today. One projection has the percentage of minorities in the oldest-old population increasing from 14 percent in 2000 to nearly 50 percent by 2100 (Wolf, 2001). As the proportion of minority populations increases over time, especially those minorities with higher prevalences of certain chronic diseases, the growing diversity among the older population is bound to influence the types of services demanded and the subsequent rates of utilization. (See Chapter 4 for more on the effects of diversity on the workforce.)

TABLE 2-4. Diversity Among the U.S. Resident Population Ages 40+, 2006.


Diversity Among the U.S. Resident Population Ages 40+, 2006.

Additionally, the educational attainment of older adults is increasing. Better-educated older adults tend to have lower levels of disability, and they may be more likely to make beneficial changes in their lifestyles, to have better access to care, and to comply with physicians’ instructions (Freedman and Martin, 1998). However, this may not fully reflect the capacity of older adults to navigate today’s complex health care system. Age itself also plays an important role. The oldest older adults (ages 85 and older) have the highest per capita utilization of health services, and that population is expected to increase from 5 million to 9 million between 2005 and 2030. Other demographic characteristics, such as net worth, family structure, and geographic distribution, may similarly affect health status and the utilization of services.

Demographic trends also have implications for the sites where care is needed. A growing percentage of older adults prefer to receive long-term care services in home and community-based settings, increasing the demand for care in these alternative settings. The delivery of long-term care will become especially complex as varying options for housing for older adults develop leading to demands for services in multiple sites.

In addition, sites of care for special populations will be affected by the aging trend. For example, in 2006, 3.7 percent of inmates in state and federal prisons and local jails were over age 55. By 2030 one-third of prisoners will be over the age of 55 (Enders et al., 2005). Also, in the next decade the number of veterans over the age of 85 enrolled in the VHA is expected to increase by 700 percent, and the utilization of long-term care services is expected to increase by 20 to 25 percent, with special need for community-based services (Kinosian et al., 2007). As Persian Gulf War-era veterans and veterans currently returning from Iraq and Afghanistan get older, their mental and physical impairments may persist, increasing the need for the care of older adults within the VHA system. The VHA has a remarkable history regarding the availability of a variety of geriatric care programs, including nursing home care, home care, palliative care, and acute care services for older adults; however, an influx of older veterans will surely strain this well-developed system.

Finally, members of the future older adult population may bring a different stock of health capital to their older years than the current cohort of older adults has done. Disability rates among older adults have been declining in recent decades (Freedman et al., 2002; Manton et al., 1997, 2006), in part due to the educational gains among older adults discussed previously (Freedman and Martin, 1999). Educational gains are expected to continue, although at a slower rate. On the other hand, the recent trend of increases in disability at younger ages, although small and starting from a very low level, may have negative implications for the future elderly population (Lakdawalla et al., 2004). Some studies suggest that the gains in mortality from reductions in smoking and better control of blood pressure might be reversed in the coming years by high rates of obesity (Cutler et al., 2007; Olshansky et al., 2005). Another study found that baby boomers on the verge of retirement are in poorer health than pre-retirees 12 years ago (Soldo et al., 2006). Trends in illness and disability will influence the need for health services among the future older adult population, though the direction and magnitude of their effects are not entirely clear. Still, even if disability rates among older adults continue to decline, the size of the future older adult population is so large that, overall, the total need for services can be expected to increase (Johnson et al., 2007).

Health Status

Many efforts to project the future incidence or prevalence of disease assume that the health status of individuals in a given age-sex category will remain constant, and, therefore, the projections depend only on changes in the age and sex composition of the population (Goldman et al., 2004). This assumption may prove incorrect in the future. Nonetheless, for many health conditions this type of projection offers the best available estimates. Examples of such projections include the following:

  • The proportion of older adults with self-reported, doctor-diagnosed arthritis will rise from 34 percent in 2005 to 48 percent in 2050 (Fontaine et al., 2007).
  • The prevalence of diabetes among older adults will rise from 5 million in 2005 to 10.6 million in 2025 and to 16.8 million in 2050 (Boyle et al., 2001).
  • 7.7 million people will have Alzheimer’s disease in 2030, up from 4.9 million in 2007 (Alzheimer’s Association, 2007).

Assuming no change in current prevalence rates for disability, 26 million of the 75 million older adults alive in 2040 will have limitations in at least one IADL, 16 million will have at least one ADL limitation, and 3 million will be institutionalized (Waidmann and Liu, 2000).

The Health Care Marketplace

Changes in the health marketplace will likely influence the demand for services as well. A number of medical advances and technologies may be introduced in the coming decades (e.g., intraventricular cardioverter defibrillators, continuous blood sugar monitors, pacemakers to control atrial fibrillation, treatment of acute stroke, and cancer vaccines) that could extend or improve life for older patients and, depending on the technology, increase or decrease the total demand for health services (AHA, 2007; Goldman et al., 2004). More care may be provided remotely, and older adults may be better able to monitor their conditions and to communicate with health care providers from home. Additionally, more or different options for care may offer better matches to patient preferences. For example, an increase in the availability of assisted-living options may result in fewer older adults living in nursing homes (Stone, 2000).

Furthermore, in the future older adults may have different preferences for care than older adults have had up to this point. Some data indicate that the physician visit rates for the baby boom generation are higher than for previous generations (AAMC, 2007). Baby boomers may have greater expectations about care or may treat their illnesses more aggressively than did their parents. Market research suggests that most baby boomers expect to be healthier in their retirement than their parents were, and one-quarter of them believe that a cure for cancer will be found before they retire (Del Webb Corporation, 2003).

Finally, future changes in coverage, cost sharing, and reimbursement policies could have a significant effect on access to care for older adults, but it is not possible to predict exactly what these changes might be. For example, the projected rise in Medicare and Medicaid spending may lead policymakers to consider new ways to improve efficiency in the programs, such as the use of health care rationing (Aaron et al., 2005). Researchers from Dartmouth estimated that nearly 20 percent of total Medicare expenditures provide no benefit in terms of patient survival or quality of life (Skinner et al., 2001); these expenditures might be cut to improve efficiency. Or, if all regions of the country could lower their spending levels to be commensurate with the lowest-spending regions, Medicare could potentially save 30 percent per year (Fisher et al., 2003). Policy makers are currently exploring the expanded use of comparative effectiveness research (Jacobson, 2007). Many of the new services provided to older adults today have little or no evidence showing that they are more effective than established treatments, and it is difficult for patients and providers to make informed decisions (MedPAC, 2007b). Policy makers may also explore the potential of alternative payment mechanisms, such as bundled payments, to provide incentives for providers to deliver care more efficiently.

Health Services Utilization

A number of projections have been developed to estimate the future demand for care from certain types of health care providers using age-, sex-, and race-specific utilization patterns. However, these projections forecast demand from all patients, not just older adults, and in most cases they assume that current utilization patterns will continue in the future, though some efforts also include projections under alternative scenarios in which practice or utilization patterns shift. For example, projections include the following:

  • The need for critical care services will rise, increasing the need for intensivists1 from 1,880 in 2000 to 2,600 by 2020 if current patterns of care continue. If utilization of critical-care physicians rises by one-third (which is, some suggest, a more appropriate level of use), approximately 4,300 intensivists would be required by 2020 (HRSA, 2006a).
  • Visits to oncologists for cancer are projected to increase from about 40 million to almost 60 million between 2005 and 2020 if current patterns of care continue. A 2 percent increase in the percentage of patients who see an oncologist and a 2 percent increase in the average visit-rates in the first 12 months post-diagnosis would result in 70 million visits in 2020 (AAMC, 2007).
  • If trends in emergency department visits among patients between the ages of 65 and 74 continue at current rates, the number of visits by these individuals would almost double from 6.4 million to 11.7 million by 2013 (Roberts et al., 2008).

Perhaps the most sophisticated models that project demand for health services from health professionals are those maintained by the National Center for Health Workforce Analysis at the Health Resources and Services Administration (HRSA). The Physician Aggregate Requirements Model (PARM) and Nursing Demand Model (NDM) project demand for services and providers based on current and forecasted patterns of health care use, staffing patterns, and insurance coverage. They consider provider-to-population ratios for population segments defined by age, sex, metropolitan/ non-metropolitan location, and type of insurance. An assumption for the baseline scenario is that these ratios are fixed (i.e., there is a constant insurance probability for each population group defined by age and sex). These ratios are then applied to population projections to estimate future demand (HRSA, 2003, 2006b).

Under a baseline scenario in which there is no change in per capita health care utilization patterns, provider productivity, or provider staffing patterns, changes in population characteristics would drive a 30 percent increase in hospital inpatient days, a 20 percent increase in outpatient visits, and a 17 percent increase in emergency department visits between 2000 and 2020. During that same period, nursing home residents would increase by 40 percent, home health visits by 36 percent, and visits to physicians’ offices by 23 percent. This rise in demand would result in a 33 percent increase in the requirements for physicians and similarly large increases in demand for other health professions: 28 percent for nurses, 18 percent for physical therapists, 20 percent for optometrists, 28 percent for podiatrists, 30 percent for licensed practical nurses, and 33 percent for nurse aides (HRSA, 2003). The PARM and NDM can be adjusted to produce estimates under different scenarios, such as an increase in the productivity of health care providers in the future.

These projections represent the aggregate rise in demand from all patients, not just older adults. However, the changes are largely driven by the growth of the elderly population, particularly since the non-elderly population is growing at a much slower rate. The committee identified only a few efforts that provide projections of the future health status and health services utilization specifically for older adults. Three of those efforts are highlighted in the next section: RAND’s Future Elderly Model is designed to develop projections of disability and chronic disease and the use of acute care services; the Lewin Group’s Long-Term Care Financing Model projects the use of long-term care and expenditures; and the Urban Institute’s DYNASIM3, coupled with data from the Health and Retirement Study, produces projections for disability and paid and unpaid long-term care.

RAND’s Future Elderly Model

The Centers for Medicare and Medicaid Services (CMS) contracted with RAND to develop a model that would incorporate demographic characteristics in generating estimates of the future health care needs of Medicare beneficiaries as well as the expenditures on these beneficiaries. Every year the Office of the Actuary in CMS issues a report containing an overview and projections of current and future Medicare spending (Federal HI and SMI Trust Funds Board of Trustees, 2007). These projections incorporate long-term trends in age-specific mortality rates (Goldman et al., 2004), but they do not attempt to make any other assumptions about future health trends (Singer and Manton, 1998). CMS has successfully predicted the number of future Medicare beneficiaries, but it has encountered more difficulty predicting program expenditures; thus the impetus for the RAND project.

RAND’s Future Elderly Model (FEM) takes a comprehensive look at the health status and utilization patterns of participating older adults and allows for alternative projections based on various assumptions (Girosi, 2007). The FEM is a microsimulation model that tracks Medicare-eligible individuals over time. The model begins with a sample of beneficiaries, ages 65 and older, from the 1998 Medicare Current Beneficiary Survey. The model ages that cohort year by year, simulating health and functional outcomes over time. These simulations require information on the risk of developing a new health condition (e.g., hypertension or diabetes) and entering a new functional state (ADL limitation, nursing home entrance, death) based on such risk factors as age, sex, race, education, obesity, and smoking. As the initial sample ages (rendering the model less representative of the entire older population), the sample is “replenished” each year with a new cohort of 65-year-olds using data from the National Health Interview Survey, which provides information on the health status of those individuals (Goldman et al., 2004, 2005).2

Baseline projections assume improvement in the mortality rate of 1.2 percent per year3 and a 2 percent increase in obesity from 2004 to 2028, with a 0.5 percent increase thereafter. Results indicate a rise in the prevalence of many chronic conditions (e.g., high blood pressure, heart disease, diabetes, cancer, stroke) and ADL limitations by 2050, although the prevalence of lung cancer decreases slightly. The projections change as the assumptions are modified. Figure 2-1 shows the percentage change in prevalence for various conditions between 2004 and 2050 under the baseline scenario. All conditions, with the exception of lung cancer, are projected to increase. However, under an alternative scenario in which obesity is reduced (half of those who are obese are made overweight and half of those who are overweight are changed to a healthy weight), the prevalence of diabetes and lung cancer are reduced and the rates of increase for the other conditions and limitations (excluding stroke) are decreased in comparison to the baseline scenario. Under a scenario in which all older smokers quit, the rates of increase for most health conditions are also smaller than in the baseline scenario (except for cancer, which rises faster), and the prevalence of lung cancer falls.

FIGURE 2-1. Percentage change in prevalence for various conditions projected for 2004-2050 under three scenarios: baseline, assuming obesity reductions, and assuming smoking cessation.


Percentage change in prevalence for various conditions projected for 2004-2050 under three scenarios: baseline, assuming obesity reductions, and assuming smoking cessation. SOURCE: Girosi, 2007.

The FEM also makes projections that take into account variations in utilization rates by age, health status, and socioeconomic class in the future elderly population. The baseline projections suggest increases in office visits, hospital days, and hospital stays of 155 percent, 170 percent, and 165 percent, respectively, between 2004 and 2050 (Table 2-5). The researchers further apportioned the change in utilization into two parts: the demographic effect, or changes in utilization related to a change in the demographic composition of the population; and the health effect, or changes in per capital utilization due to changes in health. Demographic changes account for the vast majority of the increase in utilization.

TABLE 2-5. Utilization Projections and Decomposition, Baseline Projections.


Utilization Projections and Decomposition, Baseline Projections.

Even under the alternative scenarios of obesity reduction and smoking cessation, utilization still rises considerably overall between 2004 and 2050 (Table 2-6). Still, reductions in obesity would save resources and reduce the overall increase in utilization compared to the baseline projection. Efforts to persuade Medicare beneficiaries to quit smoking would improve health but would also increase utilization because beneficiaries would live longer (Girosi, 2007).

TABLE 2-6. Utilization Projections and Decomposition Under Alternative Scenarios.


Utilization Projections and Decomposition Under Alternative Scenarios.

The Lewin Group’s Long-Term Care Financing Model

The Lewin Group developed a microsimulation model to estimate disability, use of long-term care (LTC) services, and LTC spending through the year 2050 for older adults. The model uses data from a number of sources including the Current Population Survey, Panel Study of Income Dynamics, the Employee Benefits Survey, and the Health and Retirement Survey to develop information on the individuals within the model, then uses prob abilities to simulate events and transitions year by year, including family status, work history, retirement income and assets, disability and mortality, use of LTC services, and financing of LTC. Although the model is focused on individuals ages 65 and older, it uses data on younger groups to project characteristics of future cohorts of older adults (Kemper et al., 2005).

The model assumes, with some exceptions, that both individual behavior and current health policy (e.g., Medicaid benefits and eligibility requirements) will remain the same in the coming decades (Kemper et al., 2005). Based on current trends, the model projections assume that age-specific disability rates will continue to decline, that the use of assisted living will grow relative to nursing home use, that the cost of LTC services will rise faster than inflation, and that more workers will be offered LTC insurance by their employers.4 Perhaps not surprising, the number of older adults with disability is projected to rise steadily through 2050, so that the number of older adults with any disability (IADL or ADL limitation) will rise from about 7 million in 2005 to more than 15 million by 2050. The projections for LTC spending are particularly striking, rising from $140 billion in 2005 to $570 billion by 2045 (Alecxih, 2006a).

Urban Institute Model

The Urban Institute and RTI International developed projections of the number of older adults with disabilities and of their use of long-term care services. First, the size and demographic characteristics of the older population were obtained from the Urban Institute’s microsimulation model, DYNASIM3, which, like the Future Elderly Model, begins with a sample of individuals and families and “ages” those observations year by year, simulating such demographic events as births and deaths, immigration, marriage and remarriage, changes in living arrangements, and changes in disability. It also simulates economic events, such as retirement. Second, data from the Health and Retirement Study were used to develop models for the provision of paid and unpaid long-term care services as a function of disability, financial resources, children’s availability, and other factors. Finally, three different disability projection scenarios are used to project future long-term care services. The model assumes that families weigh relative costs and benefits when making long-term care arrangements and that they would use less unpaid help from children and more paid help when the costs to children of providing informal care are high (Johnson et al., 2007).5

Table 2-7 shows the results, detailing the percentage and number of older adults with disabilities in 2000 and in 2040 under the three different disability scenarios. Disability is defined as having any ADL or IADL limitation. The intermediate scenario, or the researchers’ “best guess,” assumes no particular future trend in disability rates; the variations in rates are small and depend on changing mortality rates and changes in the demographic characteristics of the population. The high scenario assumes that the older adult disability rate would increase by 0.6 percent per year from 2000 to 2014 and remain constant thereafter, similar to the rate of increase used in RAND’s future elderly model. The low scenario assumes that older adult disability rates will decline 1 percent per year indefinitely, which is consistent with assumptions for earlier projections made by the Congressional Budget Office (Johnson et al., 2007).

TABLE 2-7. Size of the Population with Disabilities, by Disability Scenario, 2000 and 2040.


Size of the Population with Disabilities, by Disability Scenario, 2000 and 2040.

Although disabled older adults are expected to decrease as a percentage of all older adults in both the low and intermediate disability scenarios, they are projected to increase in numbers under all scenarios because of the rapidly increasing size of the older adult population. In the intermediate scenario, for example, the number of disabled older adults more than doubles between 2000 and 2040. This increase would fuel the use of both paid and unpaid long-term care services. Under the intermediate scenario, an additional 5.5 million older adults would receive unpaid services and 3.1 million more would receive paid services in 2040 (Table 2-8). Even under the optimistic low scenario, several million more older adults would receive unpaid help and over a million more would receive paid care in 2040 than in 2000.

TABLE 2-8. Number of Older Adults Receiving Long-Term Care Services, by Disability Scenario, 2000 and 2040 (in Millions).


Number of Older Adults Receiving Long-Term Care Services, by Disability Scenario, 2000 and 2040 (in Millions).

Despite the considerable growth in the absolute numbers of older adults receiving services, the percentage of the population receiving services is projected to remain steady or to decline (Figure 2-2). Nevertheless, in the intermediate scenario, the average number of paid help hours per month is projected to increase from 163 to 221 over the 40-year time period. The average number of hours of unpaid at-home care received from children would remain relatively constant, and the number of hours of unpaid help received from others would decline slightly (Johnson et al., 2007).

FIGURE 2-2. Percentage of older adults with disability receiving long-term care services, intermediate disability scenario, 2000 and 2040.


Percentage of older adults with disability receiving long-term care services, intermediate disability scenario, 2000 and 2040. SOURCE: Johnson et al., 2007.

Limitations of Projections

The projections presented above are helpful in providing a general idea of the possible future health needs and health services utilization of older adults, but they do not describe a complete picture. Most of the projections rely heavily on data collected from large national surveys that ask about a limited number of illnesses and types of health services used. Although the Health Retirement Survey, the National Long-Term Care Survey, the Current Medicare Beneficiary Survey, and the National Health Interview Survey provide some limited data on geriatric syndromes, the simulation models often do not examine that data. Also, national surveys and datasets provide comprehensive information on physician visits and hospital stays but not on visits to other types of providers who deliver significant amounts of care services.

What all of the projections described above have in common is that they extrapolate data from the past in order to predict the future. Although it may be the best approach available in many cases, it is not without its limitations and certainly not without controversy (Olshansky, 2005). For example, one limitation of these projections is that they cannot predict changes in utilization patterns that result from changing patient demands. The models will project sizable increases in nursing-home use because of the growing number of older adults, even though the use rates have been falling.

Demographers and health service researchers regularly debate whether assumptions about future rates of disability or illness are inappropriately high or low; regardless of the precise assumptions used, however, the qualitative interpretations of the findings are clear and consistent. Even among the most optimistic projections in which the future cohort of older adults is healthier than today’s, the growth in the absolute number of older Americans will result in a greater total volume of illness and disability and a greater collective need for services from the health care system. Estimates of the magnitude may vary, but again, even the most optimistic scenarios indicate that the change will be considerable—and, in particular, that it will be one that warrants a high level of attention and action today so that the system is better prepared by 2030.


Although an examination of health expenditures is beyond the scope of the committee’s charge, a consideration of the tremendous growth expected in the use of health services would not be complete without turning some attention to its cost. In 1999 per capita health care spending for the population under age 65 was $2,793; for the older adult population it was $11,089, and for nursing home residents it was $44,520. The vast majority of health care costs for older adults was borne by Medicare (52 percent) and Medicaid (12 percent) (ASPE, 2005). In 2006 Medicare paid $406 billion in benefits (Federal HI and SMI Trust Funds Board of Trustees, 2007). In 2003 Medicaid paid $263 billion in benefits, including $105 billion for dually eligible beneficiaries, the vast majority of whom are older adults, and $68 billion for other aged and disabled Medicaid beneficiaries (Holahan and Ghosh, 2005).

The 2007 report of the Federal Hospital Insurance and Supplemental Medical Insurance Board of Trustees contained a Medicare funding warning: The projected growth rates are not sustainable under current financing arrangements. The hospital insurance trust fund, which funds Medicare Part A, is projected to be exhausted by 2019 (Federal HI and SMI Trust Funds Board of Trustees, 2007). The financial outlook for Medicaid is hardly better. Medicaid is the second largest program in state budgets, growing faster than other state programs. Medicaid spending grew 9.5 percent in 2004, compared to a 3.4 percent growth in state revenue. States have implemented a number of measures designed to slow the rate of spending, including reductions in eligibility and benefits (Smith et al., 2004). The budgetary situation of these two programs is dismal, and policy changes will likely occur prior to 2030 in order to address them.

Although the committee did not consider policy options for addressing the financial viability of the two programs, committee members were mindful of the financial realities during the course of their deliberations. Insufficient funding for Medicare and Medicaid will place strains on the ability of health care professionals to provide quality health care services. It will also exacerbate issues of recruitment and retention—a particular concern in the case of providers qualified in geriatrics, whose presence in the field is already dreadfully low.

The financing of care is only part of the problem, however, and simply allocating more funding or resources will not fully address the deficiencies in the care of older adults.


Older Americans today have longer life expectancies than did previous generations of older adults. As the population ages, however, the actual numbers of older adults living with disability or illness are rapidly increasing. Many older adults live their extra years with higher rates of chronic health conditions that require vigilant care on the part of their health providers. As a result, older adults account for a disproportionate amount of the health care services delivered in the United States. Furthermore, because of the variety of physical and mental illnesses seen among older adults and the variety of care sites in which they receive services, the care of today’s older adults is especially complex.

Future generations of older Americans may have different health care needs because of changes in the distribution of many demographic charac teristics, including race, socioeconomic status, and geographic location, and also because of changes in personal preferences about how they care for their health and where they receive their health care services. It is difficult to make exact projections of these needs because of uncertainties regarding the effects of changes in demographics, lifestyle, and disease prevalence. Utilization patterns may also change markedly because of these effects and also because of changes in the health care marketplace and innovations in medical diagnostic and treatment modalities. While projections are difficult, one conclusion is certain—that the absolute growth in the number of older Americans will strain the current health care system if patterns of care remain the same.

If the health care workforce—already too low in numbers and competence levels to provide adequate care to the current population of older adults—is to be prepared for the coming spike in demand for services, serious reforms need to be considered. This will include redesign in the way that health care teams deliver their services. New models of care have been developed to improve the financing and organization of health care services for older adults. These models have a variety of implications for the workforce with respect to individual roles and responsibilities, scopes of practice, and payment rates. Chapter 3 examines a number of these new models as well as strategies to support their further development.


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HRSA defines intensivists as “physicians certified in critical care who primarily deliver care to patients in an intensive care unit” (HRSA, 2006a).


See Goldman et al., 2004, for a thorough explanation of the methods and assumptions for the projections.


During the 20th century mortality among older adults declined approximately 1 percent per year (Crimmins, 2004).


See Kemper at al., 2005, for a thorough explanation of the methods and assumptions for the projections.


See Johnson et al., 2007, for a thorough explanation of the methods and assumptions for the projections.

Copyright 2008 by the National Academy of Sciences. All rights reserved.
Bookshelf ID: NBK215400


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