How will we disrupt aging
before aging disrupts
economic growth?
Building an engaged aging strategy

Figure1: Engaged aging
Figure 1: Engaged aging

Engaged aging

Upsides
New services
empower the older
and chronically ill,
promoting independence

The elderly become thewell-derly, living longer,
healthier and moresocially connected lives

Scientiﬁc advances
stop/reverse thebiological causesof aging

Age-related diseases
become more affordable
and predictable forsociety and governments

Big data and smart
algorithms predict
health status andenable preventionStart-ups andincumbents gain newrevenue opportunities

As EY explores the upsides ofengaged aging, it’s not enough toquestion the status quo. Here arebetter questions that businesses,companies and individuals mustask — and ultimately answer.

2| Engaged aging

Better questions:• How will we disrupt aging — before aging disrupts economic growth?
• Pay for diseases of aging? Invest in longevity?
• What happens when “older” means better and healthier?
• Is healthy aging a basic right — or a luxury good?
• What are the best digital and genetic technologies to enable healthy aging?
• How can novel partnerships between governments, businesses and seniors
promote healthy aging?

It is time to recognize the current
demographic shift for the disruptive
force that it is, on par withtechnological dislocations such as
artificial intelligence and the Internetof Things. It is not hyperbole to say
the costs of treating diseases of aging
threaten to overwhelm health systems
and the agendas of companies andgovernments around the globe.

In January 2017, Robert Marchand, a dapper, 105-year-oldFrenchman with the aerobic fitness of someone less than half
his age, set a new world record for his age bracket, cycling 14
miles in one hour. Marchand, who has vowed to continue histraining, is exceptional. Physically fit, socially connected andintellectually engaged, he is a poster child for healthy aging andthe repositioning of elderly as “wellderly.”
He is also still the exception.
For every Marchand, there are thousands more seniors withserious health problems, from cardiovascular disease to Type 2
diabetes to Alzheimer’s. As societies globally have made great
strides in reducing infant mortality and death from infectious
disease, we are living longer. But while we have made inroads inpreventing heart disease and treating certain cancers, we are notnecessarily living better.
The issue is already acute in Asia-Pacific, where a 71% increase in
the number of people 65 or older by 2030 is projected.1 Indeed,in its Global Risks Report 2017, the World Economic Forumlists aging populations as one of the top five drivers of globalchange, alongside growing income and wealth disparity andclimate change.2

Building an engaged aging strategy |3Aging: a disruptive force
It is time to recognize the current demographic shift for thedisruptive force that it is, on par with technological dislocations
such as artificial intelligence and the Internet of things. It is not
hyperbole to say the costs of treating diseases of aging threaten
to swamp health systems and the agendas of companies andgovernments around the globe. As Paul Irving, Chairman of theMilken Institute Center for the Future of Aging, said in a recent
interview with EY, “Every company needs to focus on population
aging. Those that don’t have a longevity strategy are missing a key
opportunity to serve new customers, enhance the effectiveness of
their workforce and improve performance for their shareholders.”

Two fundamental shifts are required to spark such a conversion.
First, health must be reframed as a lifelong asset worthy of thatinvestment; second, individuals must be empowered by new tools
and data to prioritize their own health, engaging proactively rather
than waiting for disease or illness to arise.

There is a silver lining to this demographic shift. Working together,governments, corporations and individuals still have an opportunity
to disrupt aging before its costs displace other priorities (see Figure1). Success requires a global change in mindset from individuals,businesses and governments. This global “we” must recognize thatmanaging diseases of aging as they arise is no longer affordable.
Linking healthy aging to the absence of disease is not sufficient.
As Larry Fink, the founder and CEO of BlackRock once said, “Tofinance longer life spans, we must convince individuals to startinvesting now for the long term.”

As aging is repositioned as longevity, stakeholders must focus lesson physical and cognitive debilitation and more on mechanisms
to improve human performance and social connections. Thesemechanisms could be new technologies (e.g., driverless cars,invisible sensors and mobile and computer apps) or new healthrelated services built on the sharing economy. Regulations
encouraging integration of services into a common platform will
propel healthy aging innovations (see Figure 2).

As part of the shift, every person will have a unique healthy aging
profile. These individual profiles will define wellness holistically
across three different, but interrelated, dimensions: physical andcognitive wellness, social wellness and material wellness. Dependingon health status, individuals may bear higher costs at a time whengovernment entitlement programs face budgetary pressure.

Figure 2: Healthy aging’s three dimensions

Material

Enablement
Broader use of corporate
wellness programs,nutrition services andpreventive tests

4| Engaged aging

Physical/cognitive

Enablement
Incentives to help pay for future
health care expenses

SocialEnablement
Redesign of public spaces forintergenerational use
Increased connectivity via asingle platform of apps

Playing the long game
Figure 3: Aging, a disruptive force
Admittedly, jettisoning the tyranny of short-term goals to focus
on long-term health is easier said than done. The up-front costsof treating diseases of aging in developed nations are alreadyenormous. Health expenditures currently account for 8% of GDP
in Japan; research suggests that decades of economic stagnation,a disproportionate use of more expensive branded drugs and theoldest population globally mean health costs will increase to 11% ofGDP by 2025.3
Already health systems in the US and UK spend more than fivetimes as much on the health care of citizens 65 and older than they
do on the under-25 generation. That cost will balloon over the next
30 years as the global population of people over 65 triples to 1.5
billion. Indeed, some forecasts estimate the global economic tollof chronic illnesses such as heart disease, Alzheimer’s disease anddiabetes will exceed US$47 trillion by 2050. That’s greater than theeconomies of the United Arab Emirates, Denmark and Hong Kongcombined (see Figure 3).4
To promote individual and corporate resilience in the face of thisdisruption, governments will need to explicitly support incentives
that promote wellness and greater health participation in younger
generations, especially baby boomers, millenials and Generation X.
Separately, regulators will have to work at the speed of business,developing policies that adapt with changing technologies andencourage innovations, particularly as the combination of new
genetic, mobile health and traditional laboratory data are combined
to enable interventions at the pre-disease stage.
Finally, no one group will have the single solution to sustainableaging. Different groups — payers, providers, life sciences companies,technology innovators and others — will have to work together tocreate scalable solutions.

Population
The world’s population over

65 will triple by 2050

This will result in an increase inchronic diseases

Treating diseases
Treating diseases as they arise is unsustainable:> US$47t: Global
economic toll of chronic
disease by 2050

US$450b: Estimatedeconomic value in 2009 of US
caregivers’ unpaid contributions

5x: Estimated amount US

health system spends on seniors(>65+) vs. under–25 generation

Wellness
New incentives promoting wellness are needed:

50%: Estimated reduction inrisk of heart disease, cancer or
Alzheimer’s disease if aging isdelayed seven years£9b: Amount UK could savefrom 2015 to 2030 if it reduced
fall-related hospitalizations 20%

Source: EY analysis, World Health Organization, Organisation for
Economic Co-operation and Development (OECD) and the International
Longevity Centre – UK.

Building an engaged aging strategy |5

Building a wellness infrastructure ...
Redefining health as a long-term asset is a necessary starting
point, but on its own, isn’t sufficient. To catalyze lasting change,
there must be substantive investment in healthy aging. Indeed,public and private organizations must come together to build awellness infrastructure that not only defines the concept, but alsoaligns incentives for different stakeholders. As we will outline in
future white papers, this infrastructure will be anchored by thefollowing pillars:

Metrics for healthy aging
Despite the fact that health is more than the absence of disease,
there are few, metric-based definitions of what wellness, exactly,
means. Yet we can’t change what we don’t measure. Only by better
defining what is meant by health will it be possible to get common
agreement about what constitutes improvement. That accord
will make it possible to benchmark new solutions, a necessary
precursor if governments and other payers are going to actuallyfund, or reimburse, them. Part of the challenge will be the creationof flexible definitions of healthy aging that account for individuals’
current health status and overall wellness potential. For instance,
a fit 70-year-old’s definition of healthy aging will be markedly
different from that of a cancer survivor or an Alzheimer’s patientof the same age. Yet each individual should have the potential tomaximize his or her health, using existing — and emerging — tools.

Data in new combinations
It’s no secret that health is full of substantial and unanticipatedchallenges, most of which will not be solved on the first try.
Separating successful pilots that should be scaled from informative
false starts requires sharing and combining diverse data sets.
New mobile technologies that monitor key biological metrics —for instance, heart rhythm or blood glucose — may spark radical,
positive changes in consumer behavior. But it’s also true that greatsounding technologies haven’t yielded measurable cost savings thatjustify the initial investment. Payers, for instance, have invested
heavily in wearables to facilitate weight loss, only to be disappointed
by the lack of long-term behavioral change.5,6 Going forward, it willbe critical to combine genetic and proteomic data with informationcollected from wearables, environmental sensors and social media

6| Engaged aging

sites such as Twitter and Facebook to better define both the riskof a given disease and its onset. Only with this knowledge will life
sciences and technology companies be able to develop lower costinterventions that health care providers and consumers can use tointerrupt the process.

Aligned incentives
Meeting the opportunities of healthy aging requires buy-in fromstakeholders across many, if not all, industries. This means aligningincentives for a broad “win.” However, public and private entities
often have very different objectives, as well as timelines, forachieving those goals. Private, corporate stakeholders may have alower risk tolerance and shorter time frame for generating profit
because of their fiduciary responsibility to shareholders. Meanwhile,
public groups may be less motivated by profit than the ability toshow a return on investment. Understanding what constitutes
success for different stakeholders is therefore essential as different
groups form new kinds of partnerships. One of the key ingredientsto rapid progress may be alliance structures that allow stakeholders
to enter — and leave — partnerships at pre-arranged and mutually
beneficial time points.

A shared purposePerhaps the most important pillar of this wellness infrastructureis the final one: the need for a shared vision that is inclusive
regardless of socioeconomic status or cultural norms. The recent
wave of anti-establishment populism throws in stark relief thefissures caused by rapid technological change at a time when social
protection programs (e.g., Medicare in the US or governmentsponsored insurance in the UK) are under stress. Simply put,
if healthy aging solutions are only accessible to the wealthiest
individuals in the developed world, they are neither “healthy” nortruly “solutions.” Part of the shared purpose must be a recognition
that healthy aging is a basic right, as opposed to a luxury good.
Closing the gap between the wealthy healthy and all others will
require greater, not less, global cooperation.

... on the current foundation
Tremendous innovation is happening as a result of profound demographic change. Over the next three to five years, there is an opportunity
to integrate what have traditionally been bespoke, siloed solutions into broader platform-based offerings that combine multiple technologies
and skill sets. Around the globe there are a number of interesting pilots in the healthy aging space worth watching (see Figure 4).

In subsequent pieces in this series, we will discuss the following:• The▶
importance of engaging with consumers to promote lasting behavior change• The▶
technologies and care services that promote the pivot from disease management to wellness• The▶
resources different partners can bring to novel partnerships
Along the way, we will share case studies that combine the leading technologies from the IT, consumer, health and life sciences industries
with cutting-edge consumer-based insights gleaned from financial and retail organizations. Our goal: to share the stories that explain, insmall but important ways, how we as individuals, companies and governments can “live long and prosper.”Figure 4: Innovating our way to healthy aging
Solution (disrupter)

Analysis

Time-banking(Give and Take Care)

Volunteers in England help seniors with daily tasks, “banking” care hours that can be withdrawn
when the volunteers require assistance.

Dementia villages(Hogewey carecenter)In the Netherlands, Italy and Germany, secure residential areas offer round-the-clock carewithout the sterility of traditional nursing homes, along with compassionate and cost-effective
services to memory-impaired seniors.

Intergenerational
housing(Humanitas)

Younger individuals in high-cost cities provide companionship and do light tasks in assisted
living centers or private homes in lieu of rent.

Precision health(Arivale, HumanLongevity)

Data from multi-omic diagnostics, traditional clinical laboratory tests and wearables can be
combined to generate a more complete picture of disease risk, allowing providers and healthcoaches to prioritize earlier, lower-cost interventions that drive lasting behavior change.

Source: EY analysis

Building an engaged aging strategy |7

Contacts
Pamela Spence
EY Global Life Sciences Industry Leader
pspence2@uk.ey.com+44 7979 708469
Twitter: @pamelaspence_EY

Jim CostanzoInterim EY Global Health Leader+1 248 705 0441
jim.costanzo@ey.com

Ellen Licking
Senior Analyst, EY Global Life Sciences Industry
ellen.licking@ey.com+1 408 283 5022

Jerome Pagani
Senior Analyst, EY Global Health Industry
jerome.pagani@ey.com+1 202 327 6346

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Sources1

Advancing into the Golden Years: Cost of Healthcare for Asia Pacific’s Elderly,
Marsh & McLennan Companies, 2016.

2

The Global Risks Report 2017, World Economic Forum, 2017.

3 The future of Japan: reigniting productivity and growth, McKinsey Global
Institute, 2015.
4

EY analysis using data from the Organisation for Economic Co-operation andDevelopment (OECD).

5Job G. Godino, Esther M.F. van Sluijs, Theresa M. Marteau, Stephen Sutton,Stephen J. Sharp and Simon J. Griffin, “Lifestyle Advice Combined withPersonalized Estimates of Genetic or Phenotypic Risk of Type 2 Diabetes, andObjectively Measured Physical Activity: A Randomized Controlled Trial,” PLOS
Medicine, 29 November 2016.

6John M. Jakicic, Kelliann K. Davis, Renee J. Rogers, Wendy C. King, Marsha D.
Marcus, Diane Helsel, Amy D. Rickman, Abdus S. Wahed and Steven H. Belle,“Effect of Wearable Technology Combined With a Lifestyle Intervention onLong-term Weight Loss: The IDEA Randomized Clinical Trial, JAMA 316, no.
11, 2016.