Posted: Sun, April 07, 2013 | By: Politics
Originally published on the Fight Aging! website.
Few people seem terribly interested in noting the opportunity costs of aging, for all that a great deal of work goes into trying to build models for the direct costs. Insurers, government program administrators, and so forth, are all eager to put numbers to their potential future outlays - but they have fewer incentives to work on better numbers for the lost ability to earn that comes with advancing age. Here are some figures from a recent paper on dementia in the US, for example:
Quote:The estimated prevalence of dementia among persons older than 70 years of age in the United States in 2010 was 14.7%. The yearly monetary cost per person that was attributable to dementia was either $56,290 (95% confidence interval [CI], $42,746 to $69,834) or $41,689 (95% CI, $31,017 to $52,362), depending on the method used to value informal care. These individual costs suggest that the total monetary cost of dementia in 2010 was between $157 billion and $215 billion. Dementia represents a substantial financial burden on society, one that is similar to the financial burden of heart disease and cancer.
If you go digging around in US census data on income, or the quick summaries thereof, you’ll see that median income sits somewhere a little under $40,000/year in the prime earning years of life. It tapers off to a little more than half of that for surviving members of the 75 and older demographic. So while one of seven completely median older people incurs costs of roughly $40,000/year for dementia, all seven completely median older people suffer an opportunity cost of roughly $20,000/year as a result of becoming old. A range of income that might have been earned if still healthy and vigorous is no longer within reach.
These are very rough and ready comparisons, but you can see that even piling in a bunch of other direct medical costs for the rest of the population - cancer, diabetes, cardiovascular disease, and the other common foes - the opportunity costs of being old still look sizable in comparison. In another study that gives average medical costs over time for people in Japan aged between 40 and 80 followed over 13 years, the average yearly expenditure was in the ~$3,500 range, rising to more like ~$25,000 in the last year prior to death. The error bars for casual use of any of the numbers mentioned in this post are large - probably a factor of two, given all of the oddities and politics that goes into medical expenditures and recording of income, and especially when comparing data between different regions on the world. But you can still draw very rough conclusions about relative sizes.
Lastly, I should note that all of the above only considers the living. Once you get to the age 75 demographic in the US, half of the original population is dead, give or take. The dead accrue even higher opportunity costs than those mentioned above, as they have (for the most part) lost all ability to earn or contribute to building new things.
So aging causes a largely unseen cost to go along with what is seen, the cost of what might have been but for disability and death. As is often the case, the cost of research and development to build the means of rejuvenation is small in comparison to what is lost to aging - and also in comparison to what is spent in coping with the aftermath of loss rather than trying to prevent it.