The economics of an aging world.
We are Living Longer. Now what?
The Business of Longevity – The Economist
By: Karina Mendoza Calayag
“The afternoon knows what the morning never suspected.”
― Robert Frost
There is an age-old problem that man has been grappling with throughout history and that is aging. Thanks to our unending quest to find the fountain of youth and beat mortality, we are living longer as compared to our grandparents, as they did theirs. The trend is expected to continue with rapid advancements in technological innovations, medicine and society’s overall better awareness of health.
The good news is – we get to have more time to do what we love to do, run more marathons, travel more and accomplish more goals in life. But, perhaps most important, it allows us to spend more time with those we love. The bad news, however, is having a longer life opens up a new set of challenges, which brings to mind a quote from Robert Frost “The afternoon knows what the morning never suspected.”
This was the central topic of discussion at the recently concluded summit The Business of Longevity by The Economist addressing the issues surrounding the whole topic of aging and longevity. The daylong conference was an eye-opener touching everyone in the audience because of its humanity, and because it is an inescapable part of reality for each one there.
As depressing and frightening some discussions notably were, there was some comfort in the optimism and the high level of interest in finding and supporting solutions provided by the thought leaders in both public and private enterprises that relate to aging. There is a strong desire out there to address the needs and with imagination, creativity, passion, and funding, therein lies massive opportunity.
Here are the highlights from The Business of Longevity:
1) If you want longevity, early detection and exercise are key.
– Predictive and preventative paths are the way to longevity says a prominent name in science and a pioneer in genomics Craig Venter co-founder, chief executive and chairman at Human Longevity.
As the first person with human genome sequence, his own,15 years ago, Venter has studied health and is fighting disease at its root, down to the microcellular level. Venter says, “by changing our lifestyle, by exercising, we ultimately edit our genes. History has shown that as lifestyles have changed, certain genes have disappeared from the human population.” This is one reason why the average lifespan has increased over time. What Venter found to be even more beneficial to longevity is being well-informed. “Exercise is an intervention but knowledge is better than exercise” says Venter. He pointed out that the information we get from an MRI procedure, for example, is essential for early detection. “It is easier to slow aging and maintain equilibrium. Chronic disease is disequilibrium.” The MRI, however, is costly and that is a barrier for a lot of people. His team at Human Longevity is working on an algorithm to drive down the cost of the procedure to make it more affordable. It would read the results instead of a radiologist which is what makes the MRI expensive today. In short, “if you want longevity,” Venter says, “early detection and exercise are key.”
What Venter found to be even more beneficial to longevity is being well-informed. “Exercise is an intervention. But knowledge is better than exercise” says Venter. He pointed out that the information we get from an MRI procedure, for example, is essential for early detection. “It is easier to slow aging and maintain equilibrium. Chronic disease is disequilibrium.” The MRI, however, is costly and that is a barrier for a lot of people. His team at Human Longevity is working on an algorithm to drive down the cost of the procedure to make it more affordable to the masses. It would read the results instead of a radiologist which is what makes the MRI expensive today. In short, “if you want longevity,” Venter says, “early detection and exercise are key.”
2) There is a strong link between family connection, happiness and the elderly’s health.
– Family connection matters incomparably to the elderly in nursing homes especially when it comes to their health. It is what they yearn for, what makes them truly happy, and as it turns out, are what’s most beneficial to their well-being and overall health.
This was what Sonya Kim chief executive and founder at One Caring Team, found in studying the elderly’s health tracking their appetite, food consumption, how well they interacted with each other, among other metrics used. Her study revealed seniors that were visited by their children stayed happier, and consequently healthier. And on the other hand, a remarkable rapid decline in health the moment they started living in the retirement home among those with the least visits from family.
“The connection to what is familiar is helpful to their cognition. It is the best solution for aging adults per Kim but that is up to the family member to provide. Keeping engaged with life and the outside world is also important but is very challenging for someone who can no longer drive or worse if wheelchair-bound. Responding to the seniors’ need to be taken outside the walls of their room, the confines of their retirement home, Kim founded Aloha VR which “will bring the world to them,” she says via virtual reality. With all the possible technological innovations, it was agreed by all that nothing can replace the human touch.
3) The concept of retirement will change or will be gone from our vocabulary.
4) People need meaningful work, a purpose to be alive.
5) Lifelong learning will keep people engaged throughout their life.
– Retirement norms, the economics of retirement, and whether it is better to have a prolonged retirement or prolonged middle age need to be reconsidered because retirement is no longer what it was dreamed up to be decades ago. Thomas Goetz co-founder and chief executive at Iodine pointed out that “the highest mortality for men is the year after they retire.” Certainly death was not part of the plan when retirement was envisioned so something must be amiss.
David Ewing Duncan chief executive at Arc Fusion sees a future where retirement no longer exists, “I’m hoping that retirement will be banished from the vocabulary.” The whole concept of retirement will go away. Not only will man be alive longer in years but living longer will actually mean more life in those added years. “The retirement age of 65 is out of date and 50% are now living longer,” says Goetz.
There are economic implications when a large set of the population, the Baby Boomer generation, is retiring, and the number of workers in the younger generation has decreased. Workers contribute into a retirement fund that helps cover public expenditures on pensions and health care expenses for the retired. This pool is doubly impacted when the population is living longer and when people are having fewer children through choice or infertility. In light of this, “Perhaps the question we should also be asking ourselves is how can we change retirement norms? Not only will it be better for society, but also better for our own health,” Duncan added.
To change the concept of retiring, “People need to have meaningful work,” says moderator Amy Kessler. “Education today is not preparing for a working lifetime of 40-50 years. For economic viability and so that skills don’t become irrelevant, lifetime learning is needed to keep engaged.”
Another area of dreaded reform in retirement is the retirement home. “We have to get better at nursing facilities because a lot are like living mausoleums,” Thomas Goetz said.
6) Loneliness is like smoking 15 cigarettes a day.
– In connection with #2, loneliness is a very common predicament among the elderly and its enormity as an issue demands attention and solutions. Not only is it widespread but its impact on health is drastic and alarming. “There is research out there that says medical implication of loneliness is 15 cigarettes a day,” says Emily Melton of Draper Fisher Jurvetson.
7) Lengthening productivity has many upsides.
– In the discussion by Alexandra Suich, David Sabow – SV Bank, Lisa Suennen – GE Ventures, and Emily Melton – DFJ, given that the current U. S. retirement system has 3 people supporting each retiree, there is a looming crisis at hand. The dependency ratio is unsustainable and lengthening productivity is a win-win solution.
Not only will it provide meaning and purpose to our elders’ lives which in turn makes them healthier, but it will also make them productive and contributing members of society. Managers need to get trained to get passed biases of the older worker in hiring and in keeping them employed, companies need to uphold this mentality and be held accountable. The power of older workers in the workforce is an untapped potential and pursuing it would be beneficial to everyone in so many ways.
As far as funding availability to support solutions, there is no shortage among Silicon Valley venture capitalists. A mindset disconnect between Silicon Valley and Healthcare in their dichotomy exists. “In Healthcare, the mantra is “Move slowly and save people.” In Silicon Valley, it is “Move fast and break things.” Extra care is required and there are risks involved in bypassing steps to achieve expediency “but there is an opportunity in marrying these together, says Emily Melton.” “We need to know how money flows into the system,” added Lisa Suennen Managing Director, GE Ventures and Managing Partner at Venture Valkyrie, LLC – GE Ventures.
8) Outliving assets is a risk in longevity.
– “We continue to misestimate life expectancy by 7 to 10 years. We risk outliving assets,” says R. Dale Hall Managing Director of Research at the Society of Actuaries.
Jacquelyn James co-director Center on Aging & Work, Boston College concurs “Nobody thought a pension is to last 40 years.”
9) We need to rethink education, work, and leisure in our lifespan.
– “We need to rethink education, work, and leisure into our own lifespan,” says James. By adding more leisure in the middle years – rather than just at retirement age – we can discover hobbies that can be pursued, for engagement and purpose at old age. “Being unprepared is not good for them, not good for society.”
10) Quality of life is more important than quantity of years.
– You may have heard an elderly who’ve said their life is just not worth living anymore. What would be the value in extending life if that is the case? Laura Deming who sees aging as a disease takes this issue to heart, that it is not just the number of years that matters but more importantly the quality. “I’m not concerned so much how long, but how well they live,” argues Deming, Full Partner The Longevity Fund and Thiel Fellow whose focus is in life extension and anti-aging. Deming, worth noting, is a child genius, at 12 was working in the world’s first anti-aging lab, at 14 was admitted at MIT, at 16 was a Thiel Fellow and at 18 became a venture capitalist still on the mission to fight aging as a disease.
11) Education level disparity is lifespan inequality.
– It sounds logical and makes common sense but now it has been concretely established that higher education is linked to longer lives. Mentioned in the discussion was that those without high school diplomas are, in fact, living 4 years shorter. An article in the NIH supported this stating “Educational attainment is a particularly profound predictor of length of life, now surpassing both race and gender in importance in the United States. … A recent study further suggested that low-educated, non-Hispanic white Americans—those with fewer than 12 years of schooling—have suffered absolute declines in adult life expectancy in recent decades”
12) Wealth is also a strong predictor of length of life.
– The final segment of the conference was a debate on whether or not living longer will only be for the wealthy.
Besides the access to better education, living in better neighborhoods with less crime and pollution, eating better food and participating in healthier activities, the wealthy have access to the best medical care. Expensive medicines and breakthrough treatments are accessible only by the 1%. “In order for these (health innovations) to go to mass market, in order to scale who is going to pay for that? Not Medicare,” arguing that it is only for the wealthy Chip Conley, Head of Global Hospitality & Strategy at AirBnB.
Not so says Busy Burr Head of Humana Health Ventures and Open Innovation. “We’ll concede that wealthy people will live longer than poor people but also all people will longer.” Cutting-edge medical procedures and medication are “tested on wealthy and then it will get scaled and it will become affordable for the rest of us. There is structural inequality. Wealth inequality impacts longevity but if you live long enough, those gaps will narrow.”
A study co-authored by two MIT researchers has revealed that indeed poor people live shorter lives. More precisely, in the U.S., the richest 1 percent of men lives 14.6 years longer on average than the poorest 1 percent of men, while among women in those wealth percentiles, the difference is 10.1 years on average.
13) The policy and regulatory landscape in retirement is not aligned with longevity
– Relating to the discussion in #7, “The average lifespan before when Social Security was started was 61 and retirement was set at 65,” says Margaret Hamburg Foreign Secretary National Academy of Medicine. But now that the average lifespan has increased to around 80, with retirement age still pegged at 65, it is among the grand challenges the US government faces today worsening with the increase in its aging population.
An article published in EDGE explains further “Congress instituted the Social Security program in 1935 in order to provide retired U.S. citizens with a system of benefits that would make retirement easier to endure. Due to the fact that there was a ratio of approximately 37 workers for every 1 retiree, it was very feasible that the American workforce could provide enough to completely support the program. Today, the ratio of participants in the workforce to Social Security beneficiaries has shrunk to less than 3 to 1 and is expected to decline even further in the next few years. Compounding the problem of decreasing worker to beneficiary ratio has been the increase in the life expectancy of an adult living in the United States. When the Social Security program was initiated in 1935, the average life expectancy was 61 years old. Considering that the average age for retirement has remained consistently around 65, beneficiaries in the early years of the program were receiving payment for a much shorter time.”
“Now, retirement is for the wealthy and French. Because retirement (in the US) creates a shorter lifespan, it is broken and incomplete, except for the wealthy. It requires stewardship,” says Hamburg. “Declines have been met by innovation both in public and in private sector. There is strong interest in both sectors and so there is also faith that they will find a way to narrow the gap.”
“The purpose of retirement and the cultural attitude to it has not caught up,” says Amy Kessler, SVP and Head of Longevity Risk Transfer at Prudential Retirement.
14) Investing in the right solutions which could be high-tech but also in low-tech.
– “We’re spending on the wrong things. We need to invest in the right solutions that would narrow this gap. [The US government] spent twice as much but we’re 37th in health among nations. Focus should be on purpose and societal expectation needs to change. The obsession of pills and gadgets are missing the point. We need to address energies on fundamental needs of society,” says James Firman President and chief executive National Council on Aging.
Revolutionizing sometimes just a matter of reimagining, reassembling and redesigning the status quo. For example, Conley questioned why childcare and elderly care separate (housed in different areas) when together they can benefit each other’s wellbeing.
There are higher-tech solutions but also low-tech solutions in making transportation accessible to the elderly, enabling their happiness, inclusion, and education.
Longevity and aging are not aligned with systems and norms in our society today.
In order to succeed, we need to continuously educate, train and provide support to the elderly to be useful throughout their years. We also need to expect them to be useful productive members of society. Policy plans need to focus on structural inequality, such as wealth inequality and education levels.
Longer and healthier lives need:
4) meaning and purpose – being useful. We live by having a purpose.
There are gaps. And there are business opportunities in bridging these gaps.
Opportunities presented in longevity are in:
1) Promoting education and continuing education for all ages
2) Creating economic opportunities for the older based on hobbies
3) Advocating hiring of older workers and banning ageism
4) Fostering a healthy lifestyle of diet, exercise, and fitness
5) Enabling happiness and connection with family and the outside world
6) Encouraging altruism among entrepreneurs
7) Adapting the public retirement system to current and foreseeable future’s needs
8) Rethinking cultural norms and attitudes regarding retirement.
Summed up in the words of Andy Rooney –
“It’s paradoxical that the idea of living a long life appeals to everyone, but the idea of getting old doesn’t appeal to anyone.”