Boom or Bust
How aging baby boomers will change Hawaii
Russell Nanod, manager of community relations for the Hawaii Medical Service Association (HMSA), is a guy who knows a thing or two about older people. The 51-year-old Nanod has advised them about financial and insurance planning, has served on numerous aging-related boards and commissions, and has even hosted a local radio show for the senior crowd.
Several years ago, it never would have occurred to the divorced baby boomer and avid golfer that he would have to move back to his childhood home in Waipahu to care for his father, Larry. However, due in part to his mother's unexpected battle with ovarian cancer, then her death last year, that's exactly where Nanod finds himself today: preparing meals, providing transportation, and managing his 87-year-old father's financial and health-care needs.
"It's made me put my personal life on hold," says Nanod, "It has changed some of what I do in my professional life." It has also given him insight into his own inevitable aging and the needs of an aging population - needs which experts warn could be particularly pronounced in Hawaii and will require policy makers to think in new terms, hopefully sooner than later.
Nanod is a member of that often-studied, rapidly-aging bulge in the nation's demographic profile, known as the baby boomers, those born from 1946 to 1964. The first boomers will begin turning 62 in 2008, signaling the start of a dramatic shift in the overall makeup of the U.S. population.
According to the National Bureau of Economic Research, the number of Americans age 62 and older is projected to double from 40 million to 80 million by 2033, while the working-age population will grow just 12 percent over the same period. This poses a myriad of social and economic challenges, which will be exacerbated in Hawaii, where people live longer on the average than in any other state, and where the senior segment's growth rate is faster than the nation as a whole. By 2020, 21 percent of Hawaii's population will be over the age of 65, compared to only 16 percent in the U.S.
Bank of Hawaii economist Paul Brewbaker says, "The demographic part is compelling. There's just more of them and they are living longer. This is not a problem that's going away. On the contrary, it's a problem that's increasing."
Pat Sasaki, executive director of the State's Executive Office on Aging (EOA) cautions, "In less than a decade, older adults will number one out of four adults in the state. With fewer working-age adults in our state, that does mean possibly a decrease in tax-dollars which support all our government programs."
The EOA profiled a typical boomer in the Islands in a report entitled, "Baby Boomer Data Hawaii 2002." In it, a boomer is described as likely to be an Asian or Pacific Islander with a high school degree (only 27 percent are college graduates); live in a family household, after marrying around age 30; have a job and a family income of about $40,000; have parents who are alive; and, for the majority, live another 25 to 45 years. The report says, "Although there is no specific data available for Hawaii boomers, national data suggest that our typical boomer is not saving regularly for retirement (only 42 percent are) and is not participating in a pension plan (only 44 percent are)."
The Hawaii director of the organization formerly known as the American Association of Retired Persons, AARP, Gregory Marchildon, says the issue of most importance to baby boomers is economic security. "How am I going to pay my mortgage, pay for mom's long-term care and put my kid through college? That's the boomer perspective on economic security," says Marchildon. Quite a conundrum, given the $69,000 a year it costs, on average, for a nursing home in Hawaii.
According to Marchildon, "significant and formidable" policy changes are going to need to be made here to address a rapidly aging society. He says, "Hawaii was not planned for an aging population. In fact, if you could plan, and Oahu is a particularly good example of this, you would put Hawaii in a textbook and say, 'This is NOT how to do it.' Most of our communities don't have sidewalks, don't have parks, don't have drugstores, don't have neighborhood places for people to go and gather, for people to walk to.
"The issues of mobility and transportation are huge for the state to confront. It's not about bigger freeways and it's not about bus rapid transportation systems. It's about livable communities and planned communities that are going to be addressing the aging population, and no one is talking about it."
Says the Bank of Hawaii's Brewbaker: "We know that there's going to be a demand for public services and certainly a political cry for policy intervention to support the elderly. We also know that the state or any of the jurisdictions haven't structured the tax system to mobilize the resources that are necessary to deliver those services."
Another potential problem is, as the sheer number of older baby boomer grows, so will the need for caregivers. With Hawaii's cultural propensity towards taking care of family members, many of those caregivers will be adult children, such as Russell Nanod.
Nanod has resigned from all of his former committees and councils to be available to Larry. He says, "For the first time in my life, I'm saying no to organizations and people who have never heard me say no before, and when I tell them why, they understand. It's because I had to refocus. I have limited time to spend with my father and he needs me to do some very basic things for him. It can be very stressful."
Karen Miyake, the executive on aging for the City and County of Honolulu, is familiar with such stories. "We see the ominous shadow of that as more and more middle-aged caregivers are calling us, wondering what to do with a parent who is becoming more dependent, she says. "As family sizes shrink, a greater percentage of individuals are likely to become caregivers at some point of their lives. Employers will be faced with more employees in that temporary, but very stressful role."
What recourse is available if it becomes too expensive or difficult for families to care for a relative in a home setting? One of the recommendations of The Hawaii Summit: 2011 Project - which sought to develop a strategic plan to deal with aging baby boomers - is that zoning codes be evaluated to allow for increased development of senior congregate housing. The project's report also recommends that support services provide a continuum of care and that the state develop a comprehensive long-term care financing system.
Even though a number of senior facilities have sprung up across the state recently, one study found that demand currently outpaces supply by more than seven-to-one (see "Boomer Town," pg. 30) Brewbaker suggests the state add to the mix by simplifying costly development processes and preapproving senior housing in centrally located Kakaako. "Perfect for retirees, close to Queen's Hospital, close to Ala Moana," he says. "That's all it takes. Knock yourself out - next 10,000 units for senior assisted living anywhere you want in Kakaako,"
One immediate bright spot is the Maui Long-Term Care Partnership, a consortium of more than 80 people working to implement a strategic plan for long-term care on the Valley Isle over the next four years. The partnership was one of eight in the nation receiving $750,000 grants from the Robert Wood Johnson Foundation, in the hope that some of the programs developed by the partnerships can help shape national policy. The fiscal agent for the grant is Hale Makua, a Kahului nursing and health-service provider. Hale Makua Chief Executive Officer Tony Krieg, who chairs the partnership, writes, "We are pleased that our community has worked together in the spirit of collaboration toward a goal of strengthening our infrastructure so that we will have a sufficient supply of home and community based services and residential alternatives, workforce, education curricula, and volunteers to meet current and future demands."
If the number of aging boomers is a problem, it can also be part of the solution by comprising a potent force for change. The EOA's Sasaki says, "For the first time, it's not going to be so bad to be an older adult, largely because you have enough numbers to create a force and a powerful voice, not only in the marketplace, but in the workplace, politics and the full spectrum." There is a general consensus that baby boomers will redefine the image of the sidelined, older American, much as they have put their stamp on other life phases.
Colette Brown, chair of the University of Hawaii's Gerontology Program, says, "Every generation worked, educated their children, cared for their aged, and paid their taxes. The real question should be: How can we not only support those who need help, but use the strengths of older adults to enrich society?"
However, baby boomers tend to be a very individualistic crowd. They are not known as the "Me Generation" for nothing. Brewbaker says, "It's all out there, kind of shrieking at us, out of data. But I'll tell you a lot of the response that I see is not collective. We are all going our own way. We are all going to build our little nest egg and build our little wealth thing and build our little gated community, keep the peasants out and the keep those property taxes low."
The lack of cohesion may reflect a wide disparity in personal savings. The Congressional Budget Office in March reported that about a quarter of boomer households have not accumulated significant savings. According to AARP's Marchildon, savings is one of four pillars to a sound retirement, along with a solvent Social Security program, a vibrant pension and 401(k) system, and health security, meaning health insurance and access to affordable prescription drugs.
Marchildon says, "If you've got those four things going on, you're not going to be Bill Gates, but you are probably going to be all right. If you have three of the four, you are probably going to be OK. If you have two of the four, you are going to be in trouble. If you have none of the four, it's a disaster."
For business, the demands arising from the boomer bulge present an economic development upside, and several local companies have seized the moment (see "Maturing Market," pg. 36). Marchildon says, "From a business perspective, we think there are some real growth opportunities here. There is a business of aging that people just aren't getting. … How might I be able to develop some kind of profit-making venture where I can provide a valuable service or commodity to this age group and still make lots of money?"
Brewbaker sees promise with the Internet's ability to alleviate problems of mobility and hypothesizes that a number of companies must already be working on biometric devices to electronically transfer data, such as blood pressure or blood sugar levels, to medical providers. He says, "We have so much bandwidth. Let's use that to fix some of these problems."
EOA's Sasaki urges boomers to come to terms with their aging now and to give thought to the areas of family communication, health care and financial planning. She says, "We all age and aging is terminal. Once we accept that reality, then - instead of dwelling on, 'We're going to be sickly,' or, 'We're going to be frail,' - why not appreciate the lives we have? Why not take the steps we can do now?"
Marchildon thinks that attitude may be enough for some, but not for many others. "If you're rich, you're stoked, because you can go to Arcadia, or you can hire the best home health-care nurses and aides and people to come do all your chores," he says. "That's great, but for most people, that's just not going to be their reality. There's a lot of middle- and upper-middle people who do well in their working lives, but when they stop generating income and they are relying on Social Security and a small pension, boy, the numbers aren't what they used to be."
Russell Nanod is experiencing many of the issues first-hand. Working full-time and caring for his father are about all he can handle for now. The future is devoid of plans or answers. "Ten or 15 years ago, I thought retirement would be great," he reflects. "Now, I'm thinking it can be a very difficult time, so you've got to take better care of yourself."
He adds, "I don't think I'm going to have anybody to take care of me. I can see how difficult it could be for a person to try to survive if you get to a certain age and you lose part of your health. Those are things you cannot buy. It paints a very scary picture."
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