Costs by Age Group

A primary driver in the growth of costs is the aging of the baby-boomer population. The baby-boomer effect will be seen essentially as a bulge in cost increases that will move towards the older age groups, reaching the 65-89 age group over the next two decades, followed by a subsequent spike in costs for the 90+ age group as the baby boomers begin to reach this age after 20 years.

This bulge will result in shifts in the peak costs, which will increase from $3.3 billion at age 85 in the current year to $11.2 billion at age 87 in 2050. The costs by age group show that by 2032, costs in the 65-89 year age group will grow by 111%, from $64.9 billion to $137 billion. Costs for the 90+ age group will increase by 85%, from $17 billion to $32 billion. However, in the period from 2032 to 2050, costs for the 80-89 age group will increase only by 34% to reach $188 billion, while costs for the 90+ age group will almost triple to $83 billion. All told, the costs for the 90+ age group are projected to increase nearly 5-fold by the year 2050. Costs among younger age groups will increase by smaller but still substantial amounts, with costs nearly doubling by 2050.

Figure 4.2.1.Distribution of Costs by Age in 2014, 2032 & 2050, 2014 $billions

Figure 4.2.1.Distribution of Costs by Age in 2014, 2032 & 2050, 2014 $billions
Figure 4.2.1. Distribution of Costs by Age in 2014, 2032 & 2050, 2014 $billions

Figure 4.2.2. Distribution of Expenditures by Age in 2014, 2032 & 2050, Nominal $billions

Figure 4.2.2.Distribution of Expenditures by Age in 2014, 2032 & 2050, Nominal $billions
Figure 4.2.2. Distribution of Expenditures by Age in 2014, 2032 & 2050, Nominal $billions

Figure 4.2.3. Total Costs by Age Group in 2014, 2032 & 2050, 2014 $billions

Figure 4.2.3.Total Costs by Age Group in 2014, 2032 & 2050, 2014 $billions
Figure 4.2.3. Total Costs by Age Group in 2014, 2032 & 2050, 2014 $billions

Figure 4.2.4. Share of Total Costs by Age Group in 2014, 2032 & 2050, 2014 $billions

Figure 4.2.4. Share of Total Costs by Age Group in 2014, 2032 & 2050, 2014 $billions
Figure 4.2.4. Share of Total Costs by Age Group in 2014, 2032 & 2050, 2014 $billions