Health Care and Financial Services.

• Author: Seninger, Steve
• Position: Statistical Data Included

Senior consumers will dramatically alter Montana industry, specifically health care and financial services. Demand for health care will increase as the population ages, and the financial services industry will focus progressively more on Baby Boomers, seniors, and the large share of income and savings they bring into financial markets. Senior marketing will become increasingly important as businesses and industry try to influence boomer spending.

Health Care Services

The national health care bill is projected to top $2 trillion by the year 2007--three years before the demographic impact of boomers is noticeable. It is important to recognize that boomers are currently intensive users of medical services, driving up demand and spending on health care services. Preventative and maintenance health care, which leads to longer life expectancies, is important to this group. In 10 years, Baby Boomers will start using Medicare, and by 2030, Medicare enrollment will be at 75 million people.

The cumulative impact of aging boomers on health care spending and on the Medicare program depends on mortality rates and the incidence of disability among the elderly. Mortality rates experienced the biggest percentage rate of decline in the 1960s and 1970s, suggesting a possible biological limit on life expectancy of 85 years and older. The incidence of disability is significant because frail or chronically ill elderly people require outpatient or institutional care.

Montana's health care industry has grown during the 1990s, and we can expect increased demand and spending in the future. Total revenue for 1997 was almost $2.3 billion, with a payroll of over $1 billion and nearly 38,000 jobs. This made health care one of the largest employers in Montana's economy (Table 1).

Hospitals account for more than half of the sales, payrolls, and jobs in the health care industry (Figure 1). And most of health care business is concentrated in the urban trade centers of Billings, Missoula, and Great Falls.

Health care is geographically accessible to the majority of Montana's elderly population because it is concentrated in the urban areas (Table 2).

Billings will continue to be the major regional health care market in the state. Billings hospitals served more than 20 percent of all inpatients in 1997, compared to Missoula (15 percent) and Great Falls (15 percent).

Rural health-care markets continue to have higher bed capacity. Rural centers have 20 percent of the inpatient...