FREEDONIA MARKET RESEARCH REPORT ANALYZES ELDER CARE SERVICES

Revenues for elder care services are expected to increase 6.6 percent per year to $264 billion in 2011.  Advances will be driven largely by demographic changes.  Medical advances and trends toward healthier lifestyles are increasing the life expectancy of all age groups and contributing to the rising number of individuals in the older population segments.  Such gains are augmented by the large, post-World War II “baby boom” generation which will be entering their retirement years.  Growth will also stem from the rising cost of providing care on a per capita basis. These and other trends, including market share and company profiles, are presented in Elder Care Services, a new study from The Freedonia Group, Inc., a Cleveland-based industry market research firm.

In 2006, skilled nursing facilities accounted for the largest share of elder care service revenues with 46 percent.  However, the fastest growth is expected in the home health care segment where gains will be driven by the growing number of older adults who choose to have nursing care brought to them, as well as the increasing use of home- and community-based Medicaid waivers to pay for care away from more expensive institutional settings.  Other elder care services, including continuing care communities, assisted living facilities and social services, will also post strong gains. 

Medicaid was the largest source for elder care service revenues in 2006 with 34 percent, including almost half of the revenue of skilled nursing facilities.  However, outlays from private insurance are expected to grow the fastest among payment sources as a greater number of older adults purchase long-term care insurance coverage and claim benefits from these policies.  Out-of-pocket payments continue to be important, particularly in continuing care, assisted living and social services which are primarily funded by private resources. 

In 2006, for-profit entities accounted for the largest share of elder care service revenues, with 63 percent of the total.  This leading position is largely due to the dominant presence of for-profit entities in the skilled nursing, home health and assisted living segments where the chain business model has taken hold.  Nonprofit groups (e.g., charitable organizations and government-supported agencies) account for the larger share of revenues in the continuing care and social service segments.

The Freedonia Group is a leading international business research company, founded in 1985, that publishes more than 100 industry research studies annually. This industry analysis provides an unbiased outlook and a reliable assessment of an industry and includes product segmentation and demand forecasts, industry trends, demand history, threats and opportunities, competitive strategies, market share determinations and company profiles.