How Much To Plan on Spending?

As medicine improves - and improves faster thanks to the efforts of researchers, educators, businesspeople, advocates and other pro-research folks - we will have access to ever more options for living longer, healthy lives. Those options are unlikely to be free, however, especially in the early years of availability. The cost of any given medical treatment drops as marketplace competition sets in and the technology is improved, but most medical expenses require planning.

That said, what sort of medical expenses should you plan on for a future that involves real anti-aging medicine? If I knew the answer, I'd go into business as a fortune teller (and make a killing on the stock market). I think, however, that there are some useful guesstimates that we can make based upon possible events down the road, the plausible future of regenerative medicine, and the way in which medical pricing has behaved in the past.

  • The current cost of a major medical procedure that does not require extensive, long-term hospitalization is around $100,000 to $200,000. This may sound like a lot of money, but remember that it's quite possible to find yourself a millionaire late in life - even on a modest income - if you make good choices about saving for retirement. "The power of compound interest" is a phrase often used in those pro-401K leaflets.

  • You should not expect insurance or governments to pay for real anti-aging treatments when they become available. They might do it, or they might not. There are several proposed future scenarios under which the medical insurance industry and government programs are bankrupted or forced into reform by extended healthy life spans. "Forced into reform" is a polite euphemism for "we are not paying for your treatment." The power of compound interest allows you to accumulate a great deal of money before you will need to spend it on retirement and future medical technologies - so make best use of your time and save wisely.

  • The trend today is towards more regulation and price controls on medicine (which translates to scarcities, less investment in research, expensive products, and poor quality of service). If this trend continues, it means that we can expect more and more countries to look like Canada or France, in which low-grade medicine is free, but complex, new medical technologies are unavailable to the public. Once again, this indicates that you should save enough money to pay for expected medical expenses ... plus transport costs to a place with a more sensible government.

  • The first wave of healthy life extension technologies will most likely be based on regenerative medicine and damage repair rather than damage prevention. Starting from this point, we can guess that the worst case scenario is that you will have to pay for replacement or major repair for each major organ in your body during this first wave period. If we believe that the costs for future regenerative medicine will be similar to current transplant costs, then that is a chunk of change. We can go back and forth on costs, but I'd start with $1,000,000 as a nice, round guesstimate.

  • While $1,000,000 is a scary, scary number, the best case scenario may be much better depending on your age. If you have 50 years to go before you expect to need even one major medical procedure, then you're in good shape and will probably not even have to take advantage of first wave regenerative medicine. If you are only a decade or two away from your first expected major medical procedure, then you have plans to make.

  • There are good reasons for believing that costs will remain much the same for major new medical procedures. Very little of that money actually goes towards technology and materials (no matter what that bill says). Most of it pays for people, time, expertise and organizational overhead. Those items tend to remain more consistant across the years even as the underlying technologies, skills and materials change.

  • There is a great deal you can do to give yourself the best chance at good health in old age. If you are planning on spending money on new anti-aging technologies, why hamper yourself with costly, avoidable conditions? Take care of the health basics and you'll save an enormous amount of money. Prevention is far better (and cheaper) than cures.

What about paying for the rest of your retirement? Well, if you're happy, healthy and active, why retire? Life goes on, and eternal play is just as boring as eternal work. It will be interesting to see how things evolve.

As a last word, predicting the future is has long been shown to be a job in which random number generators and chimps do as well as humans. Regulation, societies, research and economies could diverge off into any number of unexpected directions, both good and bad. I hope these points demonstrate that you should be thinking about scenarios involving future medicine and the associated costs now, however, no matter what your age and status.

Comments

One smart way to prepare for the cost of life extension is to invest now in biotech. If we are correct about life extension, the biotech sector will mushroom in value and your investment will grow with it. You will then be able to afford whatever treatment you need. And you can feel good that you contributed financially to the development.

If we are wrong about life extension, the sector will still grow in value, only not as much. This won't matter because the expense you're planning for (the cost of the treament and the cost of living longer) won't materialize either.

The trick is to diversify your investment within the sector. There will be many companys that take a wrong turn, make a poor bet and are punished accordingly. If your investment is spread across the sector, you'll be okay.

Here's Yahoo's list of top-performing technology themed mutual funds:

http://biz.yahoo.com/p/tops/st.html

Posted by: Stephen Gordon at March 24th, 2004 8:18 AM

Many of the early regenerative therapies will be expensive in the West, but could be reasonable cost in Asia. An example of this is bypass surgury. Bypass surgury is typically USD90,000 or so in the U.S. Performed in Singapore (by surgeons just as competent as thos in the U.S.) such surgury is about USD11,000-15,000. Its lower still in Malaysia and, presummably, India.

Such medical "outsourcing" is already becoming a reality. The BBC recently had an article on thier website about this. I know people who have gone to Taiwan and Thailand for elective (i.e. cosmetic) surgury.

I fully expect to be hopping on the plane for Asia when the time comes for me to undergo "regenerative" therapy. I have never expected that insurance will pay for this stuff. Being self-employed, I have only catastrophic insurance anyways.

I do not expect "regenerative" therapy to involve the growing of organs in a chamber, then transplant of such organs into you. This is too primative and expensive. At worst, such therapy will involve the injection of stem-cells (either embryonic or adult) into you be shot or, morel likely, "nanotech" based drug delivery technique (several start-ups in both U.S. and Asia have developed this already).

More likely, compounds will be developed that will "immortalize" and or "turn-on" stem-cell reservours that already exist within your body, which will result in "in-sitsu" regeneration of your body. The compounds will be delivered by the same "nanotech" delivery systems that the stem-cells would be.

Not only will this be MUCH cheaper (can be done on out-patient basis, for one thing) but is much more elegant than barbaric practices such as surgury.

Yes, this is good 20 years away, but I really do believe this is possible. For more information on "nanotech" delivery systems, scan through the Nanotech Business Alliance company directory. There are a fair number of start-ups developing this now.

The other reason why Asia will be the best place for these therapies is that most people there have less money to spend on medical treatment and there is no "single, third party payer system" that makes medical technology so expensive in the West. A therapy has to be affordable in order to succeed in the marketplace. Also, Asia has, or will have, the largest global market for regenerative therapies anyways.

BTW, Aubrey de Grey is well aware of these aspects of Asia, with regards to development and commercialization of anti-aging therapies.

Posted by: Kurt at March 24th, 2004 5:04 PM

Good comments; the medical outsourcing item is something I shall have to add to my thinking on the subject.

I agree that the end result of regenerative medicine will not be organs for transplant - however I do see it as a plausible intermediate stage. At the moment it looks possible that tissue engineers will be growing at least some full organs before we understand how to completely control the regeneration of organs in situ.

Posted by: Reason at March 24th, 2004 10:57 PM

Facile, elitist, probably accurate. The vast majority of the US economy has been created by the baby boomers, the very ones who want and need longevity medicine. Only a fraction can afford it, not only because it is not fully here yet but because it has come largely too late for this generation of boomers to enjoy. Consequently, it is uncompassionate for this writer not to note that the largest majority will be unable to benefit from the coming longevity medicine when it fully hits the marketplace. Telling a 60-year-old to "save" after pointing out that in the US a single complex procedure in the hospital costs $100,0000, and the older reader probably has spent that or more on just insurance costs by that age (!), even if he/she has never been to the hospital, is cruel lack of consolation. This article is for the elite: the healthy wealthy.

Posted by: David Dressler at June 23rd, 2008 11:15 AM

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