No matter the economic downsides of the world's coming demographic transition, one industry will boom: eldercare. Now that mom is less likely to die at the age of 60 from pneumonia or a sudden stroke, she's more likely to require years of intensive care as time slowly saps her ability to take care of herself. She's also less likely to have multiple children who can chip in to provide that care.
Such care, delivered at the level that many people would hope to provide their parents, is enormously expensive. This is not because the U.S. is overcompensating our nursing homes; even private nursing facilities don't have magnificent profit margins. And Germans, who have government-provided long-term care insurance, seem to be finding themselves in the same boat, as this Bloomberg story points out:
The insurance pays out 1,550 euros ($2,060) a month to German citizens who, like Miskulin, need the highest level of care. That's less than half of the 3,250-euro average monthly bill for such care inside Germany. Nursing homes in Poland are marketing care that in some cases may be similar or better for about 1,200 euros per month. The German government will pay as much as 700 euros toward nursing care outside the country. Though less than half the amount provided for in-country homes, it's enough, together with most retirees' pensions, to pay for monthly care costs -- with cash to spare.
As you may guess from this paragraph, the solution that many Germans have hit on is to export their parents to nursing homes in Eastern Europe, where lower wages allow a better standard of care at a lower cost.
The rub is that nursing home care is inherently low-productivity. True, innovations have let seniorslive longer on their own, from those chairs that lift you up the stairs, to step-in bathtubs, and life-alert systems if you fall anyway. But if you need help dressing and going to the bathroom, or the constant gentle supervision that dementia patients require, there's no substitute for a human being.
Of course, nursing homes do not have one staff member per patient. But the patient-to-staff ratio can't be too high without endangering the patients. Right now, U.S. nursing homes use over 4 hours of staff-time per patient day, and many people think this is too low. Unfortunately, as the linked study concludes, getting more staff time -- particularly more registered nurse time, would require substantially improving reimbursement rates.
The Japanese solution seems to be developing robots to care for nursing home patients. That would certainly raise the productivity of nursing home facilities, but as the Economist suggests, there are some wrinkles left to be worked out.
Because of the country's vast experience with automation for the motor and electronics industries, Japanese researchers have tended to focus on developing nursing robots that can grasp or fetch things. Far less attention has been given to machines capable of performing trickier and more delicate tasks like washing, wiping, shaving or brushing a patient's teeth. The trouble with anthropomorphic robots capable of such dexterity is that they are invariably complex and expensive -- costing $200,000 or more.
They can be heavy, too. Robots can typically lift no more than 10% of their own weight. A nursing robot capable of lifting, say, a full-grown man and putting him in a bath or a wheelchair can weigh as much as a car. The possibility of a one-tonne robot becoming unbalanced and toppling on a patient does not bear thinking about.
Not even mentioned: How will a patient with dementia react when a giant machine grabs her and tries to brush her teeth?
Germany's solution not only saves the government money, but also, at least in some cases, allows for a higher standard of care, because everyone in Poland, from nurses aides to doctors, makes much less. But that's not exactly a free lunch. It's harder to monitor the care your parents are getting if they're across a national border. And if you want to bring them back, as the Bloomberg piece shows, things may get very complicated indeed.
And it certainly won't work in a country like the U.S., where the state Medicaid systems handling most nursing-home care aren't going to pay for you to be relocated to a nursing home in Belize. Though perhaps we'd better reconsider that -- or else we'd better get cracking on inventing better robots.
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Megan McArdle at email@example.com