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Elder Care Services


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US revenues to grow 5.2% annually through 2016
Revenues for the elder care services industry (i.e., skilled nursing, home health care, social services, continuing care, and assisted living) are expected to grow 5.2 percent per year through 2016 to $319.5 billion. Advances will be driven largely by demographic changes in light of increasing life expectancy, which is contributing to the rising number of individuals in the older population segments. Growth is further boosted by the large, post-World War II “baby boom” generation entering their retirement years.

The market will be restrained by continuing efforts at the state and federal levels to curb Medicaid and Medicare expenditures, often by limiting reimbursements or by directing patients to less expensive forms of care. For instance, the 2010 Patient Protection and Affordable Care Act expands support for home and community based services, including home health care and social services. Elder care service providers compete functionally with informal caregivers, typically family members; however, a growing number of older adults either do not have family members who are able to care for them, or simply prefer using professional care.

Home, community based services to grow the fastest
In 2011, skilled nursing facilities accounted for the largest share of elder care service revenue with 43 percent. However, home and community based services (e.g., home health care, social services, assisted living) are projected to achieve the fastest growth. Advances will be driven by continued state and federal efforts to shift Medicaid payments away from skilled nursing to more cost effective community based services. Additionally, many older adults prefer to age in place, remaining in their homes as long as possible.

Nonprofits to outpace for-profit entities
For-profit entities accounted for twothirds of elder care service revenues in 2011, benefiting from the growing use of the chain and franchise business model. However, nonprofits (e.g., charitable organizations and government-related agencies) are expected to slightly outpace for-profits through 2016.

Medicaid to remain leading payment source
Medicaid will continue to be the leading payment source for the elder care services industry despite efforts at the state and federal levels to curb expenditures. Medicare payments will experience the fastest annual growth, though future legislative changes and fluctuating reimbursement rates have the potential to affect that outlook. Out-of-pocket expenditures continue to be important in the continuing care and assisted living industries, as many of the costs of these services are not covered by Medicare or Medicaid. Private insurance coverage will rise as the aged population grows and individuals who doubt the government’s ability to provide future care purchase long term care insurance. Other payment sources include charitable donations, private grants, and other government resources such as the US Veterans’ Administration.


PRESS RELEASE

Revenues for the Elder Care Services Industry to Exceed $319 Billion in 2016

Revenues for the elder care services industry (skilled nursing, home health care, social services, continuing care, and assisted living) are expected to grow 5.2 percent per year through 2016 to $319.5 billion. Advances will be driven largely by demographic changes in light of increasing life expectancy, which is contributing to the rising number of individuals in the older population segments. Growth will be further boosted by the large, post-World War II “baby boom” generation entering its retirement years. Gains will also be spurred by a recovery in the economy and the housing market, enabling older adults to more easily finance their care. Further growth will be restrained by continuing efforts at the state and federal levels to curb Medicaid and Medicare expenditures, often by either limiting reimbursements or by directing patients to less expensive forms of care. Elder care service providers compete functionally with informal caregivers, typically family members; however, a growing number of older adults either do not have family members who are able to care for them or simply prefer using professional care. These and other trends are presented in Elder Care Services, a new study from The Freedonia Group, Inc., a Cleveland-based industry market research firm.

In 2011, skilled nursing facilities accounted for the largest share of elder care service revenues with 43 percent. However, home and community based services (e.g., home health care, social services, assisted living) are projected to achieve faster growth. Advances for home and community based services will be driven by continued state and federal efforts to shift Medicaid payments away from skilled nursing to more cost effective community based services. Additionally, many older adults prefer to age in place, remaining in their homes as long as possible. Continuing care revenues will grow strongly, benefiting from a rebound in the housing market as many older adults sell their homes to pay for the steep entry fees of continuing care facilities.

For-profit entities accounted for 66 percent of elder care service revenues in 2011, benefiting from their dominance in the large skilled nursing segment and leading position in the home health and assisted living markets as the chain and franchise business models develop. Nonprofits (e.g., charitable organizations and governmentrelated agencies) account for the larger share of revenue in the continuing care and social services markets.

  • INTRODUCTION
  • EXECUTIVE SUMMARY
    • Table ELDER CARE SERVICE REVENUES (billion dollars)
  • MARKET ENVIRONMENT
    • General
    • Demographic Trends
      • Table POPULATION & HOUSEHOLDS (million persons)
    • Macroeconomic Outlook
      • Table MACROECONOMIC INDICATORS (billion 2005 dollars)
    • Consumer Spending Trends
      • Table PERSONAL CONSUMPTION EXPENDITURES (billion dollars)
    • Building Construction Trends
      • Table BUILDING CONSTRUCTION EXPENDITURES (billion dollars)
    • Business Establishment Trends
      • Table BUSINESS ESTABLISHMENTS (thousands)
    • Service Sector Outlook
      • Table SERVICES INCOME (billion dollars)
    • Health Care Trends
      • National Health Expenditures
        • Table NATIONAL HEALTH EXPENDITURES BY CATEGORY (billion dollars)
      • Medical Conditions
        • Table CHRONIC CONDITIONS BY TYPE (million conditions)
        • Table ACUTE CONDITIONS BY TYPE (million conditions)
    • Regulatory Environment
    • World Markets
  • SERVICES
    • General
      • Table ELDER CARE SERVICE REVENUES BY SERVICE TYPE (billion dollars)
    • Skilled Nursing Care Facilities
      • Overview
        • Table SKILLED NURSING CARE SERVICE OVERVIEW
      • Providers
        • Table SKILLED NURSING CARE REVENUES BY PROVIDER TYPE (million dollars)
      • Payment Sources
        • Table SKILLED NURSING REVENUES BY PAYMENT SOURCE (million dollars)
    • Home Health Care Services
      • Overview
        • Table HOME HEALTH CARE SERVICE OVERVIEW
        • Table PERSONAL EMERGENCY RESPONSE SERVICE OVERVIEW
      • Providers
        • Table HOME HEALTH CARE REVENUES BY PROVIDER TYPE (million dollars)
      • Payment Sources
        • Table HOME HEALTH CARE REVENUES BY PAYMENT SOURCE (million dollars)
    • Social Services
      • Overview
        • Table SOCIAL SERVICES OVERVIEW
      • Providers
        • Table SOCIAL SERVICE REVENUES BY PROVIDER TYPE (million dollars)
      • Payment Sources
        • Table SOCIAL SERVICE REVENUES BY PAYMENT SOURCE (million dollars)
    • Continuing Care Retirement Communities
      • Overview
        • Table CONTINUING CARE COMMUNITIES OVERVIEW
      • Providers
        • Table CONTINUING CARE COMMUNITY REVENUES BY PROVIDER TYPE (million dollars)
      • Payment Sources
        • Table CONTINUING CARE COMMUNITY REVENUES BY PAYMENT SOURCE (million dollars)
    • Assisted Living Facilities
      • Overview
        • Table ASSISTED LIVING FACILITIES OVERVIEW
      • Providers
        • Table ASSISTED LIVING REVENUES BY PROVIDER TYPE (million dollars)
      • Payment Sources
        • Table ASSISTED LIVING REVENUES BY PAYMENT SOURCE (million dollars)
  • SERVICE PROVIDERS
    • General
      • Table ELDER CARE SERVICE REVENUES BY SERVICE PROVIDER (million dollars)
    • For-Profit
      • Table FOR-PROFIT ELDER CARE SERVICE REVENUES BY SERVICE TYPE (million dollars)
    • Nonprofit
      • Table NONPROFIT ELDER CARE SERVICE REVENUES BY SERVICE TYPE (million dollars)
  • PAYMENT SOURCES
    • General
      • Table ELDER CARE SERVICE REVENUES BY PAYMENT SOURCE (million dollars)
    • Medicaid
      • Overview
        • Table SELECTED MEDICAID STATISTICS (billion dollars)
      • Medicaid Payments for Elder Care Services
        • Table MEDICAID PAYMENTS FOR ELDER CARE SERVICES (million dollars)
    • Out-of-Pocket
      • Table OUT-OF-POCKET PAYMENTS FOR ELDER CARE SERVICES (million dollars)
    • Medicare
      • Overview
        • Table SELECTED MEDICARE STATISTICS
      • Medicare Payments for Elder Care Services
        • Table MEDICARE PAYMENTS FOR ELDER CARE SERVICES (million dollars)
    • Private Insurance
      • Overview
        • Table SELECTED PRIVATE INSURANCE STATISTICS
      • Long Term Care Insurance
      • Private Insurance Payments for Elder Care Services
        • Table PRIVATE INSURANCE PAYMENTS FOR ELDER CARE SERVICES (million dollars)
    • Other
      • Table OTHER PAYMENTS FOR ELDER CARE SERVICES (million dollars)
  • REGIONAL MARKETS
    • General
    • Regional Population Aged 65 & Over
      • Table RESIDENT POPULATION 65 YEARS & OVER BY REGION (million persons)
    • Regional GDP
      • Table REGIONAL GROSS DOMESTIC PRODUCT (billion dollars)
    • Elder Care Services by Region
      • Table ELDER CARE SERVICE REVENUES BY REGION (million dollars)
      • Northeast
        • Table NORTHEAST ELDER CARE SERVICE REVENUES (million dollars)
      • Midwest
        • Table MIDWEST ELDER CARE SERVICE REVENUES (million dollars)
      • South
        • Table SOUTH ELDER CARE SERVICE REVENUES (million dollars)
      • West
        • Table WEST ELDER CARE SERVICE REVENUES (million dollars)
  • INDUSTRY STRUCTURE
    • General
    • Industry Composition
      • Table ELDER CARE SERVICE REVENUES BY COMPANY, 2011 (million dollars)
    • Market Share
    • Competitive Strategies
    • Marketing
    • Mergers & Acquisitions
      • Table SELECTED ACQUISITIONS & DIVESTITURES
    • Cooperative Agreements
      • Table SELECTED COOPERATIVE AGREEMENTS
    • Company Profiles
      • ADT Corporation
      • Adult Day Care Group
      • Advocat Incorporated
      • Amedisys Incorporated
      • American Senior Communities LLC
      • Assisted Living Concepts Incorporated
      • Atria Senior Living Group Incorporated
      • Benedictine Health System
      • Brookdale Senior Living Incorporated
      • Capital Senior Living Corporation
      • Chemed Corporation
      • Covenant Care Incorporated
      • Ecumen
      • Emeritus Corporation
      • Evangelical Lutheran Good Samaritan Society
      • Extendicare Incorporated
      • Five Star Quality Care Incorporated
      • Genesis HealthCare Corporation
      • Gentiva Health Services Incorporated
      • GGNSC Holdings LLC
      • Griswold Home Care Incorporated
      • HCP Incorporated
      • Home Instead Incorporated
      • Interim HealthCare Incorporated
      • Kindred Healthcare Incorporated
      • LCS LLC
      • Life Alert Emergency Response Incorporated
      • Life Care Centers of America
      • LivHOME Incorporated
      • Manor Care Incorporated
      • Masonicare
      • National HealthCare Corporation
      • Royal Philips Electronics NV
      • SavaSeniorCare LLC
      • Senior Care Centers of America Incorporated (formerly Active Day)
      • Skilled Healthcare Group Incorporated
      • Sodexo
      • Sun Healthcare Group Incorporated
      • Sunrise Senior Living Incorporated
      • Tyco International Limited
    • Other Elder Care Companies

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