Rising Healthcare Expenditure in Aging Societies

Strategic Insights -

A growing population of older individuals in Austria has led to a surge in healthcare expenditure. To address this issue, researchers have conducted a detailed analysis of the factors influencing cost dynamics, including changes in longevity, population age-structure, and socio-economic health disparities. The study employed a dynamic microsimulation model to project healthcare expenditure in Austria until 2060, highlighting the potential impact of demographic ageing on the economically active population. The researchers emphasized that policies targeting healthy life years and socio-economic disparities can help mitigate the economic burden of ageing.

Key Takeaways:

  • The Austrian Institute of Economic Research (WIFO) conducted a study to analyze the factors influencing healthcare expenditure in Austria, which is expected to rise due to demographic ageing.
  • The researchers used dynamic microsimulation to project healthcare expenditure in Austria until 2060, considering changes in longevity, population age-structure, and socio-economic health disparities.
  • Nearly two-thirds of the projected cost increase stems from declining mortality, while one-third results from age-structure changes.
  • Per-capita costs rise by 26% under a morbidity expansion scenario, but could decrease by 5% if lower mortality is accompanied by an extension of healthy life years and a reduction in socio-economic health disparities.
  • Economic costs per working-age person increase by 12% to 48%, depending on the scenario, but adjusting for labor force expansion and benefits, the increase ranges between 5% and 39%.
  • The study found that policies targeting healthy life years and socio-economic disparities can significantly mitigate the economic impact of ageing.
  • The researchers suggested that closure of the gap in costs currently observed between education groups could lead to lower healthcare expenditure.

Statistics:

  • Nearly two-thirds (66.7%) of the projected cost increase stems from declining mortality.
  • One-third (33.3%) results from age-structure changes.
  • Per-capita costs rise by 26% under a morbidity expansion scenario.
  • Per-capita costs could decrease by 5% if lower mortality is accompanied by an extension of healthy life years and a reduction in socio-economic health disparities.
  • Economic costs per working-age person increase by 12% to 48%, depending on the scenario.
  • Adjusting for labor force expansion and benefits, the increase ranges between 5% and 39%.

Sources:

  • The impact of ageing, socio-economic differences and the evolution of morbidity on future health expenditure - a dynamic microsimulation. BMC Health Services Research, 2025;25(1):952.
  • BMC Health Services Research can be contacted at: Bmc, Campus, 4 Crinan St, London N1 9XW, England.
  • BioMed Central - www.biomedcentral.com/;
  • BMC Health Services Research - www.biomedcentral.com/bmchealthservres/
  • Thomas Horvath, Austrian Institute of Economic Research (WIFO), Arsenal Objekt 20, Vienna, 1030, Austria.