Another day older and deeper in debt

As I get older, I often joke about "what a drag it is getting old," reciting from some of my favorite rock 'n' roll wisdom. But my smile fades with each article I write about what we—the younger generation—are doing to the older generation. I'm beginning to fear that when I reach retirement that I won't have the wherewithal to pay for that proverbial "mother's little helper."

I recently had the opportunity to visit my 85-year-old Uncle Ralph just before he died. He was a member of "the Greatest Generation" who had served his country during World War II and spent his career working as a civil servant, which provided him the good fortune of having both a defined benefit pension plan and retiree medical benefits. And, having lived beyond the life expectancy of most men born in 1921, Uncle Ralph tapped those benefits for 20 years.

But most of my uncle's contemporaries and those who have followed him into retirement are not so fortunate.

Rather than recognizing the contributions of those who have completed their workforce lives, pensions are being pared and their employer-sponsored health benefits stripped away.

According to Mercer Human Resource Consulting, 19% of employers provide supplementary health benefits for Medicare-eligible retirees, down from 66% that did so in 1988.

At the same time that access to employer-sponsored benefits is becoming scarce, retirees are being asked to foot more of the bill. A recent survey by the Kaiser Family Foundation and Hewitt Inc. found that 80% of employers plan to increase retiree premium contributions in 2007.

Since the majority of employers have capped their annual contributions for retiree health benefits, health care costs will continue to shift to retirees. If health care costs double over the next 10 years—which is very likely given the rate of medical inflation—a person who retires today will have to pay twice as much for health benefits in the year 2017.

Those just entering the workforce or who have 20 or more years until retirement could feasibly prepare for their post-retirement health care expenses. But because many retirees are living on fixed incomes, with little or no savings, a growing number of them are going into debt to pay for their medical expenses.

According to the Employee Benefit Research Institute, the debt load for seniors 75 and older surged 160% between 1992 and 2004 to an average of $20,234. In fact, the percentage of households 55 and older that are in debt grew faster than the overall population, EBRI found.

This should remind us about the futility of teaching old dogs. You can't introduce consumerism—a euphemism for patients paying more out of their own pockets—to people who are already chronically ill and, in some cases, barely clinging to life.

When I think about where it all might lead, I am reminded of the 1968 cult movie "Wild in the Streets" in which a twentysomething rock star becomes president and orders everyone older than 30 exiled to internment camps.

But that wouldn't solve the pension or retiree health care crises because we'd still have to feed and clothe them and provide medical care when they got sick—unless we did something drastic like the solution imposed in the 1973 science fiction drama "Soylent Green." When the old are no longer contributing to society, we could just recycle them as fodder for the food supply. Then there's always the "Brave New World" solution—voluntary euthanasia.

I have no children, so I've informed my 17-year-old niece that she will be responsible for my care. She laughed and said, "I'll find you a nice nursing home, Auntie Joanne." Disappointed, I insisted that if she is going to put me in a home that it at least be someplace warm, like Hawaii. Her reply? "We'll just put you somewhere cheap and tell you it's in Hawaii. You'll be too senile to know the difference."

There's got to be a better way to treat our elders.