New Hampshire’s “Silver Tsunami” : A Sea Change in Healthcare Costs

Frank O'Dwyer

New Hampshire has one of the highest percentages of baby boomers in the US

New Hampshire has a higher percentage of baby boomers on average than most of the nation: 30 percent.

“Relative to the rest of the country we have a larger proportion of that 45-65 age group.” says Steve Norton, Director of New Hampshire Center for Public Policy Studies. The Center released a report today looking at what will happen to healthcare costs in New Hampshire once all those boomers age into retirement.

The study found that by 2020 –the not so distant future–the state’s health care needs will be greater, and costlier, than they are today as boomers age.

Right now, New Hampshire ranks second-highest in the nation for the percentage of residents who have private health insurance through their employer. But says Norton as New Hampshire’s large boomer population ages into retirement, they will shift from private health insurance into Medicare.  That could be a major financial hit for some of the state’s hospitals as many patients quickly shift from higher-paying private insurance to lower-paying Medicare.

“We’ve got a lot of people aged 40-60 that are employed in very good jobs,” Norton says.  “And all those people are ultimately going to become eligible for Medicare shifting a huge portion of the population our of private insurance into publicly funded insurance.”

There’s also the question of the growing number of boomers who will eventually age into Medicaid, which pays for nursing homes and healthcare for the disabled. Medicaid is funded by both the state and the federal government. As boomers age, the state’s Medicaid costs will rise dramatically, says Norton.

“The aging process has the potential of breaking the bank of the state budget and its management of the Medicaid program,” he says. “[Grappling] with how we manage the older populations within the Medicaid program is going to be very important from a financial stability perspective.”

But there’s still time before the tsunami hits. Norton says it’s important for the state to plan for these major changes which are happening slowly, but happening none the less.

“We’re 10 years away from it right now.  We’re in our economic prime right now, and now is time we should be thinking about, it not 10 years from now when we’re in it.”