Home > Uncategorized > Life-Span Gap Skews Entitlements Toward the Well-Off – Bloomberg

Life-Span Gap Skews Entitlements Toward the Well-Off – Bloomberg

As policy makers peer into the abyss below the fiscal cliff, they are beginning to talk about making changes to Medicare, and perhaps even Social Security. When looking at these programs, they would be wise to take into account the widening gap in life expectancy — a gap defined by education and income.

Since better-educated, higher-income Americans are living longer than everyone else and therefore collecting benefits longer, Medicare and Social Security are becoming less progressive on a lifetime basis. Fortunately, there are ways to offset this gap.

The average life expectancy at birth in the U.S. is now 78.7 years. But in life expectancy, as in many things, averages obscure many details.

Higher-income people have pretty much always lived longer than lower-income people. In the early 1970s, however, the gap started expanding rapidly. In measuring this phenomenon, researchers typically look at education, rather than income, because education is correlated with lifetime income but is not affected by bouts of ill health, which can skew the relationship between current income and health status.

In 1990, 20-year-old white women who had at least a college degree were expected to live to age 81, while those with less than a high-school degree were expected to reach 79, a recent study in Health Affairs found. By 2008, however, that two-year gap had widened to more than 10 years. For 20-year-old white men, the difference grew from five years in 1990 to 13 years in 2008.

Changing Expectations

Other studies show a similar pattern: For people high on the scale of socioeconomic status, life expectancy is rising at a decent clip. For those at the bottom, it is stagnant at best – – and in many cases is actually declining.

via Life-Span Gap Skews Entitlements Toward the Well-Off – Bloomberg.

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