— By Dr. Arun Varma
Creating a wellness-oriented ecosystem for the elderly is a sound growth strategy!
In the recent Russia elections, one poll promise made by candidate Vladimir Putin was that he would raise the age of retirement, if re-elected. This may sound paradoxical from an Indian’s point of view where unemployment remains high among the youth.
What Russia’s politicians used as a plank is an indicator to the universal challenge of ageing and the efforts to keep the older people to be productive. Falling fertility and mortality has hastened the process of ageing of societies. Japan, Scandinavia, Western Europe are already in the grip of this issue. China, after its decades of birth control is now keen to reverse the trend. India is on the threshold to enter. To avoid a catastrophic situation of fewer young people providing for a larger pool of old people, a mutually beneficial middle ground has to be sought.
The way India addresses the challenge could be a test case in many ways. United Nationsreports that there are approximately a billion old people in the World. This is poised to cross two billion by circa 2050. In the Indian context, it is estimated that the share of old people that was 8% of the total population in 2011, will go up to 20% by 2050 to 380 million.While it is teeming with people, there is not enough wealth generated to offer any post-retirement support as entitlement. Faster urbanization shrinks the per capita living space forcing the nuclear families to explore external options to maintain their elderly people.
As ageing is an inevitable and irreversible phenomenon, the society has to be prepared to face this demographic transformation. For the ease of argument we can break the support to elderly into three – physical, social and financial. Physical support would include specially designed living space; assisted daily living (ADL) etc. Social support calls for involvement of Family; building and maintaining communications links and companionship. Financial which is self-explanatory is the ways and means of accomplishing the earlier mentioned two components.
Cut to the other side. Unemployment is on the rise among the Youth. One of the recent studies pointed out that for one million rupee real economic output, it took 11 people in 2001-02. The same output could be achieved in 2011-12 with just 6 people. This is because of the introduction of greater automation, technology and efficiency achievement in the farming, manufacturing and services sectors. Conversely, this also questions the celebrated “Fortune at the Bottom of the Pyramid” model where the under serviced masses that can unleash the potential of tremendous prosperity. In other words, the conventional job avenues remain inaccessible to the aspirants – despite having focused skills training schemes – at the bottom of the pyramid. This calls for innovative approaches and creation of new job roles.
Developing specially designed Retirement Homes for the elderly must be taken up as a priority. Ongoing real estate development should consider having specific extension plans to accommodate the old people. Needless to say, the designing has to be significantly superior from the commonly found ramps and railings approach. Such initiatives will find easy enrolments from the burgeoning middle class and non-resident members in the urban areas. It creates more jobs, too for the Youth.
In healthcare, with the bulge of the cohort of old people, there is a growing demand for assisted daily living (ADL). As old age is not a medical condition, most people do not need hospital care and ADL can be provided by a qualified Care Worker. This is a job role that can be positioned below the Nurses. A certified care giver assumes different names in different parts of the world. It is a Nursing Assistant in some places, Bedside Assistants in another. Societies that have advanced in their perspective of elderly care have placed a premium on care givers. Australia, Japan, Denmark and the Netherlands are examples. India, with is tradition of overseas migration, should promote the protocol-based skills training for Elderly Care setting global standards – both overseas as well as domestic employment opportunity. A care giver will be more affordable to the family than a Nurse.
Second aspect is to engage the elderly people socially. It is not surprising that most old people fight an inner battle of depression, fear of death, losing purpose in life, insecurity and many more. Engaging them socially and keeping them active holds the key to avoid a serious catastrophic health expenditure. There have been recurring and increasing instances of abuse of the old people, which more often than not occurs within the family. Packing them off to a retirement home and regularly pay for their needs alone will not absolve any one of their responsibility. Family and Friends play a critical role in maintaining the wellness of the old people. Hospitality, Counselling, Companionship, Recreational Activities etc. by professionals can be another job opportunity.
Third aspect is financial and is more complex. Other than the pensioners – who account for only a small part of the total – old people mostly live in a state of perennial uncertainty and fear. Most worries revolve around financial stability. In India, there is a need to design flexible financial products that can serve this segment. It is estimated that households with only elderly people incur a monthly per capital health expenditure that is 3.8 times that of households with no elderly members. Financing the out of pocket expense (OPE) holds the biggest challenge for the old people. This is also the tricky part of healthcare financing of the elderly. In India, those who are covered under any form of health insurance accounts for about 26% according to the Insurance Regulatory and Development Authority (IRDA). After factoring in the insurance cover through Rashtriya Swasthya Bima Yojana (RSBY), the actual subscription of health policies would be further down.
Oxford Economics, a forecasting firm, predicts that the out of pocket expenditure by Indians to grow substantially from US$ 74.8 billion in 2016 to US$135.6 billion in 2021. This also indicates huge untapped potential for introducing long term care insurance (LTCI) for the elderly people. With the advancement of technology through internet of things (IoT) and wearables, and Apps, monitoring one’s health has become easy. In such a situation, it is not difficult to imagine a day where health insurance products are marketed for the elderly with clear incentives offered to buyers for adhering to disciplined lifestyle, wellness regimen etc. Something like a “No Claim Bonus” in motor insurance!
In all, the growing elderly population is a cohort that grows in strength. It is not appealing to Mr Putin alone. For us, in India too, there is a great deal of opportunity to transform the way we perceive old people and their lives.
 United Nations Report on World Population Ageing, 2017.
 India Ageing Report, UN Population Fund (UNFPA), 2017
 CRISIL Market Research
 Strategy+Business Journal, 2004, C K Prahlad, Stuart L. Hart et al
 Ministry of Skill Development of Entrepreneurship is an initiative by the Indian Government to impart employability-linked industrial skills
 Ensuring care for the Golden Years – Way Forward for India; Deloitte-FICCI 2014
 Global Analysis of Health Insurance in India EY; Oxford Economics/Haver Analytics 2018
(The author is the Managing Director of Winage™)