College Papers

According the total number of live births during

 

According to the World Health Organisation (WHO), “The number of people
today 2012, aged 60 and over has doubled since 1980.” It is evident that the
percentage of the older population is increasing. Population ageing, according
to the UN (2015) “is the increasing share of older people in the population.” Consequently,
population ageing means that the ratio of the dependant population to the working
population is increasing. This is important because if the dependant population
becomes larger than the working population, the working population will no
longer be able to support dependant population. This an important factor for
policymakers when allocating resources. Population ageing happens due to increasing
life expectancy and declining fertility. This essay will discuss what causes
population ageing and the enormous pressures it can have on public health care
systems. Privately funded health care systems are not affected in the same way,
that’s why this essay shall focus on publicly funded health systems.

Causes of Population Ageing

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Population
ageing is booming because of the major developments in the improvement of health
care. Due to modern medicine, acute illness which would previously be fatal,
are no issue at all. Additionally, chronic,
long set illness can now be better managed and people with these illnesses are
now living significantly longer. Figure 1 shows a clear upward trend of age of death
for HIV infected patients, compared with time; showing that people with chronic
illnesses are living longer. The shift in causes of deaths, mean that people
are dying much older, therefore life expectancy is increasing. Improving health
care also means that infant mortality rates (IMR) are falling. According to
Spiegelman (1993), “The infant mortality rate is a constant generally taken as
1000 obtained by dividing the number of deaths between birth and age one year
among residents in a community by the total number of live births during the
calendar year.” The fall in infant mortality rates mean that parents are
inclined to have fewer children and don’t feel the need to replace children
died, thus decreasing fertility rates. Better
health care increases life expectancy and lowers fertility rates, making it a
major cause of population ageing.

Through
research, government intervention and otherwise, the increase in education has
contributed to population ageing. Studies have shown that better educated
people are more likely to treat health as an investment. According to the
Grossman Model (1972) an increase in education is expected to increase
investments in health. Kenkel (2000) showed that there is a positive
correlation between education and preventative health care. Being more cautious
with preventative care, will mean people live healthier lives. Thus education
increases expectancy. Greater availability
of education also means that mothers are more educated about the treatment of
the foetus in the utero. Almond and Currie (2011) showed that there are links
between how you are treated in the utero and high blood pressure which can lead
to diseases later in life like cardiac arrest. Therefore being treated
correctly in the utero, could prevent diseases, thus increasing life expectancy. Improving education also improves education on
contraception, introducing sexual education and teaching the effects and study
will reduce the number of babies being born. Santelli, Lindberg, Finer et al
(2006) did a study among adolescent girls, aged 15-17, and contraception in the
US and showed that improving education on contraception declined the pregnancy
risk by 77%. Lower pregnancy rates will lead to less births. This shows a clear
correlation between contraception education and falling fertility rates. Consequently
better education increases life expectancy and can also lower fertility rates,
making it a major cause of population ageing.

Another
cause of population ageing is the fact that women today have more choice than
ever. The availability of abortions today is higher than ever before. In
Ireland abortions are illegal and thousands of women each year fly to the EU to
have an abortion, Rhinehart (2012). These challenges mean that less people are
having an abortion. Therefore, the increasing availability of abortions means
that fertility rates are declining. Another choice more women are making, is to
be in the labour force. The perception of woman in the work force has changed
greatly, meaning that women are deciding to be more career focussed and there is
less pressure at a young age or children at all. This means that fertility
rates are declining even further. Consequently
more choice for women lowers fertility rates, making it a relevant cause of
population ageing.

The
final reason discussed in this essay is the outdated, old age income
hypothesis. The old age income hypothesis, is the hypothesis that parents would
chose to have children so that when parents get older, their children will look
after them and provide for them. According to Bental (1988), having children is
an investment and the return is a combination of utility and support when the
parent gets old. Therefore, having children is a trade-off between the
financial investment and time spent on a child, and the utility the child gives
you and what kind of support having a child gives you. However, this hypothesis
is outdated, therefore, people today are less dependent on their children for
financial support. The main reason for having children is utility. Intuitively
this means that there is less of an incentive for parents to have children or
as many children as they would have previously. Consequently, fertility rates
are declining.

 

Consequences on the provision of healthcare

Many
public health care systems are pyramid schemes. This is where the tax payer now,
pays for the debts of the past working population. This works for a population
of baby boomers, however with a shrinking population there will not be enough
of the working population to pay off the elderly populations’ previous debt, or
in the health care case need the working population to pay tax and fund the ever-increasing
health care costs caused by the elderly. This is demonstrated in figure 2,
showing that as time goes on expenditure is going to carrying on exceeding
revenue by growing amounts. This means the sustainability and structure of
federal programmes in relation to the increasing ageing population are a
concern. Resources are becoming more sought after, thus scarcer, which in turn means
that policy makers have harder decisions to make. However, it could be argued
that due to the improvement in health care, people are now healthier, and the
retirement age is increasing. So, if people are working till a later age, they
are paying taxes which could decrease the gap portrayed in figure 2.

 

Due to
an ageing population the demand for end of life (EOL) care is constantly
increasing. It is increasing because more people are living to old ages and due
to improvements in health care, the period end of life care is used is getting
longer. This is quite controversial as it could be argued that at points during
EOL care the patient could be ‘in states worse than dead’ (less than 0 on the
QALYs scale). This being weighed up it could be disputed that it is not worth
the opportunity cost. This is putting a massive strain on public health care
systems, like the US system of Medicare. Medicare is an insurance system which
covers end of life care which qualifying US citizens can get free or subsidised
(by the US government) and it can be used to pay for EOL care.  Medicare is 21% percent of the money the US
spend on health care and of that 28 percent
is used on EOL care, Pasternak (2013).
This shows that EOL care is very costly and it could be argued that the
money used could be better allocated elsewhere.

 

Health care for the older population is costly. The highest
percentage of the population that uses health care is the elderly. “New
forecasts from the Office for Budget Responsibility (OBR), released in January
2017 indicate that rising demographic and cost pressures could result in 14.7%
of the national income needing be spent on health and long-term care by
2066-67”, Luchinskaya, Simpson, Stoye (2017). Figure 3 shows the age profile of
public health spending the UK relative to 30-year-olds. There is a clear positive
correlation between age and index, when age is greater than 45. This clearly
shows that the dependant population use more resources than the working
population. Thus, the resources the ageing population use, could become a
burden on the NHS.

 

Although
this essay has argued a strong correlation between an ageing population and
financial stress on health care systems, it can be argued that this is a ‘red
herring’. Zweifel, Felder, Meiers (1999) pose an alternative hypothesis that
the “positive relationship between age and health care expenditure (HCE)
observed in cross-sectional data may be caused at the simple fact that at age
80, for example, there are many more individuals living in their last 2 years
than at age 65”. This has massive implications on policy makers, as they can
now view these health care costs as fixed and inevitable. Werblow, Felder,
Zweifel (2007) reviewed and wrote an updated paper where they came to the same
conclusion apart from the one exception “seems to be acute care provided to
long-term care patients, regardless of whether they end up dying or surviving”.
It also seemed to become apparent in the paper that the cost of health care
ultimately is driven by medical technology, some of which appears to be
lavished on patients with rather limited life expectancy.

 

In
conclusion there are many causes of population ageing, however they all lead to
either decreasing fertility rates or increasing life expectancy. This suggests
that less people are being born but more people are living longer, leading to a
higher proportion of the population being dependant. Although there are
arguments against, this essay has demonstrated the massive effect on public
health care. It means that there are less people paying taxes, hence
expenditure is becoming greater than revenue. EOL care is also becoming more
prevalent and more expensive so again, there is more pressure on the tax payer
and the policy maker. It is also argued that health care for the elderly
population is more expensive and they are more frequent users of public health
care services. All these reasons show that an ageing population puts a massive
strain on public health care systems.

The most
significant cause of population ageing, discussed in this essay, is better
education. Although better health care, like better education is, increases
life expectancy and decreases fertility rates, it can be argued that better
health care means people can work for longer and therefore pay income tax for
longer. This is significant as it increases revenue meaning there is more money
for expenditure on healthcare.

The most
crucial affect of population ageing on healthcare is the pyramid structure of
public healthcare system. It is inevitable with all the predictions that, if
things carry on going the way they are, the dependant population will outnumber
the working population. So, on a government funded health care system there
will be no way in which there will be the resources to fund a public health
care system, and may have to start looking at private alternatives.