Slashdot Mirror

← Back to Stories (view on slashdot.org)

Americans Are Dying Younger, Saving Corporations Billions (bloomberg.com)

Posted by BeauHD on from the pros-and-cons dept.

An anonymous reader quotes a report from Bloomberg: Steady improvements in American life expectancy have stalled, and more Americans are dying at younger ages. But for companies straining under the burden of their pension obligations, the distressing trend could have a grim upside: If people don't end up living as long as they were projected to just a few years ago, their employers ultimately won't have to pay them as much in pension and other lifelong retirement benefits. In 2015, the American death rate -- the age-adjusted share of Americans dying -- rose slightly for the first time since 1999. And over the last two years, at least 12 large companies, from Verizon to General Motors, have said recent slips in mortality improvement have led them to reduce their estimates for how much they could owe retirees by upward of a combined $9.7 billion, according to a Bloomberg analysis of company filings. "Revised assumptions indicating a shortened longevity," for instance, led Lockheed Martin to adjust its estimated retirement obligations downward by a total of about $1.6 billion for 2015 and 2016, it said in its most recent annual report.

Mortality trends are only a small piece of the calculation companies make when estimating what they'll owe retirees, and indeed, other factors actually led Lockheed's pension obligations to rise last year. Variables such as asset returns, salary levels, and health care costs can cause big swings in what companies expect to pay retirees. The fact that people are dying slightly younger won't cure corporate America's pension woes -- but the fact that companies are taking it into account shows just how serious the shift in America's mortality trends is.

37 of 274 comments (clear)

  1. Sweet news! by Anonymous Coward · · Score: 5, Funny

    Thanks to sugar in the Standard American Diet (SAD).

    1. Re:Sweet news! by ShanghaiBill · · Score: 4, Insightful

      If anything, it is less of a problem in America because very few corporations have defined benefit pensions anymore. If your 401k runs out before you die, that is your problem, not your employer's.

    2. Re:Sweet news! by Salgak1 · · Score: 3, Funny

      Foods that don't spoil easily are not new. I recall, when I wore the uniform, eating a breakfast of bacon that was canned in 1943, and eating eggs that were powdered and canned in 1954.

      In 1988. And trust me, they were NOT addictive (grin)

  2. Nice healthcare by Billly+Gates · · Score: 4, Insightful

    These so called evil socialist countries meanwhile laugh at us while their death ages grow and do not worry about losing their retirement over a medical issue

    --
    http://saveie6.com/
    1. Re:Nice healthcare by alvinrod · · Score: 4, Insightful

      Those so called evil socialist countries don't have America's terribly unhealthy population. Compare the U.S. against any of those so called evil socialist countries people would want to live in (i.e. Sweden, not Venezuela) and they typically have lower rates of obesity, tobacco, alcohol, and hard drug consumption. Saddle them with an equal number of your average 'Murican and their system would hopelessly buckle much like the knees of the obese Walmart shopper under the added burden of a sixth 40-count box of twinkies.

      You could maybe argue that if the U.S. had some form of free healthcare it might not get to that point, but a lot of those same people are the kind of nutters that think the government put fluoride in the water to control people's minds and wouldn't go to some free government clinic for checkups. That and it would probably take away from their time of complaining to each other about evil socialized medicine and the government trying to take away their Medicaid.

    2. Re:Nice healthcare by Billly+Gates · · Score: 4, Informative

      Obesity is a problem in Europe as well since rates have doubled. Fast food chains and sugary drinks are there as well and also expanding

      --
      http://saveie6.com/
    3. Re:Nice healthcare by rtb61 · · Score: 5, Insightful

      Universal health means principles of preventative health care https://en.wikipedia.org/wiki/..., are applied by government upon a national basis and there is greater incentive for the government to ensure a healthy environment and more effective system of social welfare to ensure a healthier status upon average is maintained. A for profit system, means, once the user is bankrupt, there is no profit in providing health care, well, excluding overloading them with debt, to seize any remaining assets post death, from lack of health service and medication.

      The reason why people are healthier in universal health care countries, is the government has an incentive to keep them that way because it is much cheaper. The reason why people are sicker if for profit health care nations because everyone has an incentive to keep the sicker to extract more profits out of them before they die.

      --
      Chaos - everything, everywhere, everywhen
    4. Re:Nice healthcare by Maxo-Texas · · Score: 2

      Most health care costs are coming from unreasonably trying to keep us boomers alive an extra 90 days.

      As in $80 to $100k or more per boomer.

      No country can afford that.

      But everything before that is pretty cheap.

      Expensive but uncommon disease are rare enough that the average cost per citizen is very cheap (maybe under a penny a year).

      But- we do need some upper limit for those too. We do implicitly- not explicitly. While it's "unlimited", we really don't honestly expect insurance companies to pay $100 million (or even $10 million) per person to keep them alive.

      --
      She was like chocolate when she drank... semi-sweet at first and then increasingly bitter.
    5. Re:Nice healthcare by t0rkm3 · · Score: 2

      Or not.

      According the several studies, one of which is linked below the cost is not a factor, as the long term care for people who are healthy is, in fact, greater than those who engage in risky activity. It makes sense, possibly, in that they accrete so many health problems that their health becomes brittle and they fail sooner. Over time you will likely encounter similar health problems; cancer is nearly inevitable, as is heart disease, and arterial sclerosis. The question is how long can you suffer small problems? You second or third knee and hip replacements would not take place with the smoker as they have already become permanently immobile.

      http://www.nytimes.com/2008/02...
      Public Library of Science Medicine journal, Dutch researchers found that the health costs of thin and healthy people in adulthood are more expensive than those of either fat people or smokers.

  3. Kinda makes me wonder by jenningsthecat · · Score: 4, Insightful

    The conspiracy theorist in me can't help but think about all the pressure to cut healthcare costs, and about food corporations pushing high-carb, high-sugar foods, and the entertainment industry with all its incentives to become a couch potato. Corporations get to increase profits in the short term, and reduce costs in the long term when people die prematurely. No, there's probably not a conspiracy per se, but it may not be entirely a coincidence either.

    --
    'The Economy' is a giant Ponzi scheme whose most pitiable suckers are the youngest among us and the yet-unborn.
    1. Re:Kinda makes me wonder by Billly+Gates · · Score: 3

      Actually obesity raises healthcare costs in the short term for everyone including corporations and their employees so their would be no net gain. Rather a net lose even if they die earlier

      --
      http://saveie6.com/
    2. Re:Kinda makes me wonder by ChrisMaple · · Score: 2, Insightful

      ...nobody wants to go first and make healthy food...

      Are you truly trying to be a jerk, or have you never been to a grocery store? There are lots of healthy foods available, and many stores work hard to supply new items in the form of exotic fruits and vegetables.

      The problem is not what's available, the problem is what people buy. Convenience foods and junk foods are popular, and you can't reasonably expect food stores to stop selling them just because they're harmful when eaten in excess. People need to exercise responsibility; this has been true for millennia. Your approach, using the threat of government guns against manufacturers, is tyranny.

      --
      Contribute to civilization: ari.aynrand.org/donate
    3. Re:Kinda makes me wonder by ShanghaiBill · · Score: 5, Interesting

      I don't think so. Let's do the math:

      According to the CDC, obesity related healthcare costs America $147 billion per year.
      There are 300 million Americans, and roughly half are fatties, so let's figure $1000 per fat person in extra healthcare expense.
      If they are fat for 50 years of their life, that would cost an extra $50k per fatty.

      Obesity reduces male life expectancy by 8 years, and female life expectancy by 6 years, on average.
      Each year an average retiree costs $9990 in medicare and $16092 in social security, so roughly $26k total.
      So by dying sooner, a male fatty would save taxpayers 8*26k = $208k.
      A female fatty would save us 6*26k = $156k.

      Even accounting for the additional healthcare cost over their life, by dying early they are a BIG win over skinny people.
      Maybe we should offer tax breaks and other inducements to encourage people to gain weight.

      All the figures used in this post were obtained by quick Google searches. Specific citations will be provided on request.

    4. Re:Kinda makes me wonder by Gravis+Zero · · Score: 2

      ...nobody wants to go first and make healthy food...

      Are you truly trying to be a jerk, or have you never been to a grocery store? There are lots of healthy foods available,

      Allow me to clarify: nobody wants to go first and only make healthy foods.

      Convenience foods and junk foods are popular, and you can't reasonably expect food stores to stop selling them just because they're harmful when eaten in excess.

      I'm not saying they should stop selling them, I'm saying that foods should be taxed based on how detrimental they are.

      People need to exercise responsibility; this has been true for millennia.

      Sure... but if they don't, what then? My idea of a tax ensure that if they are irresponsible that they will still get medical care without putting the burden on other people.

      Your approach, using the threat of government guns against manufacturers, is tyranny.

      My approach is to allow companies to sell their items but also include a tax on unhealthy items to pay for people's future medical bills due to the items they have selected. There is no "threat of government guns against manufacturers" and it's certainly not tyranny but rather it's simple civic responsibility. If you cause a problem, you should be responsible for cleaning it up.

      --
      Anons need not reply. Questions end with a question mark.
    5. Re:Kinda makes me wonder by sjames · · Score: 4, Insightful

      If it's so inefficient, why is it that it costs half as much as American healthcare and achieves better results?

    6. Re:Kinda makes me wonder by kilfarsnar · · Score: 2

      Public healthcare is inefficient, tyrannical, and anti-moral. It punishes through taxation those who work hard and take care of themselves; It rewards those who abuse their bodies.

      Insurance is also immoral, by promoting and pandering to cowardice, but at least it isn't forced on people by gun-wielding thugs in police uniforms.

      You're kind of proving Poe's Law with this post. You seem to think that "taking car of yourself" precludes you from needing healthcare. It doesn't. People fall ill and get injured. It's part of the human condition and not necessarily a result of poor choices or lack of character.

      --
      "What the American public doesn't know is what makes them the American public." -Ray Zalinsky (Tommy Boy)
    7. Re:Kinda makes me wonder by Gr8Apes · · Score: 2

      First, regarding the topic, what companies still offer pensions? For example, Verizon employees haven't been eligible for pensions for well on a decade. So they're only talking about their current load of mostly already retired previous employees. Many other companies stopped offering pensions decades ago as the 401K push really started in the late 80s. So this is an accounting issue that mostly applies to the past, and has no real bearing going forward more than a few years.

      According to the numbers from CMS studies on health care costs, medicare/medicaid expenditures on average for males/females above the age of 64 is near $20k/year. Much of that is nursing home care, which the obese require more of and sooner.

      --
      The cesspool just got a check and balance.
    8. Re:Kinda makes me wonder by sjames · · Score: 2

      Since you sound absolutely desperate for me to come up empty, I'll give you a link to Forbes.

      Dig deeper here.

    9. Re:Kinda makes me wonder by sjames · · Score: 3

      Excerpts? I don't have the relevant subscriptions. However, if their titles have any relevance to their content, only item 1 appears relevant to anything. The rest are just comparisons from within the U.S. of insured or not (as well as race) where the question is U.S. vs other 1st world countries. That is, surprise, a country too chintzy to implement single payer healthcare also begrudges adequate care to the poor.

      Or to put a finer point on it, right wing whackadoos have spent the last 40 years turning medicare and medicaid into a strawman argument against socialized medicine by sabotaging them at every turn. Now you expect me to be surprised how bad it is? It's either that or Americans are the only residents of the 1st world who are too incompetent to self-govern. Everyone else's government manages to get healthcare at least somewhat right.

      At least I had the courtesy to not blast you with irrelevant papers in the same way a squid uses ink.

  4. Profits are great by youngone · · Score: 4, Insightful

    But for companies straining under the burden of their pension obligations...

    I have no idea what the pension obligations are for the massive multinational I work for, but I do know profit was up nearly 7% to US$14 billion in the last year, so I don't think straining is quite the right word.

  5. Pensions? by DogDude · · Score: 4, Insightful

    What pensions? What companies still give pensions? I'm not aware of any US companies that give pensions.

    --
    I don't respond to AC's.
    1. Re:Pensions? by apoc.famine · · Score: 4, Insightful

      You seem to have a very isolationist view of the world.
       
      Why does my organization still offer a pension? Because everyone gets in on it, from the secretaries up to the C* positions, and you get out what you put in + matching and interest, with the only variance being when you snuff it. Given the topic of the article here, companies saving because lifespan increases are stalling, that should make pensions even more solvent. If the whole organization can benefit from a pooled investment, why shouldn't they? Why on earth would you rather lone-wolf it and do your own financial planning? It's like self-insuring your house and your car. If you're stupidly rich or love to take life-crushing risks, sure, makes sense. But for everyone else, safety in numbers.
       
      Pensions are a way for a company to show that they are invested in their employees. That they want loyalty to the company, and are willing to pay for it. Not a bad thing, if they're run honestly and well. They're a financial instrument with well understood risks, and those risks can be managed pretty well.
       
      Mine is well distributed between stocks, bonds, and other long-term, stable investment instruments. As employees get older, their share is moved into the more stable instruments. New employees get a larger share of the stocks, with the assumption that they can ride out some ups and downs, and make some real gains before retirement. What this means is that there's no "oh shit we're out of money" for retirees - their money is safely tied away in the bond markets. No, it's not going to grow much, but it doesn't have to. Younger employees get more of the risk, and if you don't make 5 years to get vested, you get your money back. Likely it's going to be a good premium on what you put in, unless you are unlucky and hit a downturn in the market.

      Why do you deserve a lifetime of payments that you didn't really earn?

      That doesn't make a whole lot of sense. If I worked just 5 years to get vested, quit, and put no more money in, at 65 I could pull something like $200/month in pension. That's matching plus interest, stock gains, etc. If you work for 30 years and contribute, that's more like $3-5k/month. You get out what you put in. It's not the gravy train for the rest of your life, regardless of what you contributed. What you can withdraw is carefully calculated based on how much you contributed, when you retired, and how long you're expected to live. It works like insurance - insurance rates are set based on how likely it is that you'll need them to pay for something, how much it will cost, and how many people are paying into the insurance pool. Here, we're underwriting loyal employee retirements as thanks for their service, rather than forcing them to take individual risks.

      --
      Velociraptor = Distiraptor / Timeraptor
  6. Infant Mortality by JBMcB · · Score: 4, Interesting

    I wonder if this has something to do with the infant mortality breakthroughs that started roughly 20 years ago. There was an article, I think in the WSJ, a few weeks ago about how mortality of 20 year olds has spiked because of the advances in neonatal care that would have normally killed them as small children.

    What happens is you get an infant with a replacement heart valve, or kidney transplant, who grows up fine, but once they switch to a regular doctor, that doctor is inexperienced dealing with patients that young with those sorts of conditions. For example, usually someone with a replacement heart valve is in their 50's or 60's and is relatively inactive, or engages in light exercise. Now you have a 20 year old with a replacement heart valve and they are going out scuba diving or running marathons. Is that safe or risky behavior? Should they try to take it easy, or is that worse than remaining active? There's no data to make a good judgement.

    --
    My Other Computer Is A Data General Nova III.
  7. There really aren't that many nutters by rsilvergun · · Score: 2

    like that. And most people agree the government should ensure everybody has healthcare. Notice how I worded that. I can ask those same people the same question with different wording and get a different set of answers. Heck, a recent poll showed only 25% of America trusted our president but 33% approved of him. Those numbers don't add up...

    Also I think they're improved diet and lack of smoking/drinking comes more from having less poverty. We've been gutting our anti-poverty programs for 30+ years. Junk food is cheap. Cigarettes are cheap (and subsidized). Booze is cheap. Education? Not so much. Not in America.

    --
    Hi! I make Firefox Plug-ins. Check 'em out @ https://addons.mozilla.org/en-US/firefox/addon/youtube-mp3-podcaster/
    1. Re:There really aren't that many nutters by Wycliffe · · Score: 5, Interesting

      Heck, a recent poll showed only 25% of America trusted our president but 33% approved of him. Those numbers don't add up...
       

      I'm actually surprised that it's that close. I'm assuming you think that it's impossible to approve of someone you don't trust. I live in the bible belt and I know a ton of religious people who held their nose and voted for Trump. They don't trust him and think he's disgusting but they trusted Hillary even less and for the most part even though they still don't trust him, they mostly approve of what he's doing. From what I've seen, I would say 75% of the people I know who voted for Trump approve of what he's doing while less than 25% of them actually trust him.

    2. Re:There really aren't that many nutters by kilfarsnar · · Score: 2

      I also can't understand how people are not approving of him. Got the economy going way up just by removing regulations Obama put in, drasticly reduced illegal immigration without even building the wall yet, talking legal immigration that most approve of, not gotten Health care, but that is not his fault.

      This is why we can't have nice things.

      --
      "What the American public doesn't know is what makes them the American public." -Ray Zalinsky (Tommy Boy)
  8. There's still a lot left over by rsilvergun · · Score: 3, Insightful

    that they haven't managed to gut by closing down the company (Hostess, I'm lookin' at you). It's a lot of money somebody else is going to pocket.

    I'm looking forward to them going after the VA & Military pensions. It'll work too. They'll pit the current enlisted folks against the new folks just like they did with the old and new employees.

    --
    Hi! I make Firefox Plug-ins. Check 'em out @ https://addons.mozilla.org/en-US/firefox/addon/youtube-mp3-podcaster/
  9. Dwarfed by government savings by Snotnose · · Score: 2

    Social security and medicare. Die early, save the government thousands. Act like lemmings, save them billions.

    1. Re:Dwarfed by government savings by amiga3D · · Score: 2

      Because they took the money out of it?

  10. Pensions and Retirement are So Yesteryear by pubwvj · · Score: 2

    The whole concepts of pensions and retirements is artificial, modern and soon to be not relevant.

    Both pensions and retirement came about in the last century during a period when the lifespan was much shorter. Social Security is the same. It was planned and set to be a date when most people would already be dead. Since then lifespans dramatically increased which put a huge burden on SS & pensions.

    Retirement is not necessary. What happened in the bygone years is people shifted from more active to less active tasks as they got older. This makes more sense than stopping working all together.

    There is a coming time when people will live a lot longer and may live practically forever. When that happens the whole concept of pensions and retirement makes absolutely no sense, even less sense than it does today with people living for 20 to 30 or even 40 years beyond their working years.

    1. Re:Pensions and Retirement are So Yesteryear by clovis · · Score: 4, Interesting

      The whole concepts of pensions and retirements is artificial, modern and soon to be not relevant.

      Both pensions and retirement came about in the last century during a period when the lifespan was much shorter.

      Most of what you said was right, but pensions are far from a new idea.
      Pensions have long been standard practice for soldiers, especially those serving during wartime.
      The Roman Empire had pensions for retired soldiers. The practice began during the first century BC.
      The practice has been found throughout history. Worker guilds, retired clergy, service to royalty, and so on offered pensions.
      In the American south, some of the slave-holding had state laws requiring pensions for freed slaves. The purpose was to prevent owners from freeing slaves too old to work profitably and thus becoming a burden on public services. This did not happen after the Civil War ended.

  11. not a problem for me ... by swell · · Score: 5, Funny

    You see, I have this plan. It's exquisitely clever and diabolical. I hesitate to mention it because then everybody will want to do it, so don't tell anyone.

    Sshh, here it is: I PLAN TO LIVE FOREVER ! And the best part is: SO FAR IT'S WORKING !

    --
    ...omphaloskepsis often...
  12. Two tiers by PopeRatzo · · Score: 4, Interesting

    Did U Know?

    Life expectancy is higher for liberals than conservatives? And life expectancy is going down for Red State voters and up for Blue State voters. So it'll all work out for the best.

    http://www.medicaldaily.com/li...

    --
    You are welcome on my lawn.
  13. Re:Why Have Fixed Benefits for Life? Lifelong = du by mark_reh · · Score: 4, Insightful

    And no one's 401K or IRA ever ran dry before they died...

    And if your's did dry up, you'd have only yourself or the thieving financial engineers on Wall Street, who spend their careers figuring out legal ways to steal everyone's money, to blame.

    People have figured out that actively managed funds are a rip off, so now they pour money into index funds. The more money that goes into them, the more tempting a target they become. Some clever person at Goldman Sachs is going to figure out how to manipulate those funds to their benefit. It's coming. You'll see.

  14. Re:Why Have Fixed Benefits for Life? Lifelong = du by apoc.famine · · Score: 4, Insightful

    I would much prefer to decide how much to invest each year, and how to invest it, myself. Then I only have myself to blame if (when?) something goes wrong.

    Because you are privileged to be intelligent, well educated, with adequate resources. If everyone was in that boat, it would be awesome. But not a lot of people are. We don't teach financial literacy in school. People get injured on the job, or get sick or injured without adequate health insurance. Boom, their entire ability to do what you're describing is gone. What then?
     
    Part of the point of social security and disability is to ensure that these people don't end up dying in the street. Don't just skip from one ER to another running up huge costs. It's crazy, but paying for someone to have an apartment tends to cost less than them being homeless. Why? Because our emergency services are really expensive, because they are high-stress, require unique skills, and need to be available 24/7. Stick a homeless person in a house and have a councilor come over at 1pm every day, and they no longer tie up a couple of cops every few days. They don't end up needing an ambulance to come to a sketchy alley with police backup.
     
    I get that social security seems like a really expensive thing, but homeless old people are way, way more expensive to deal with. Maybe you're in favor of just letting them die, but most of us realize that that's not a really good solution for many reasons. If we can't do that, then the next least expensive thing should be done. That's social security. (Well, social security and universal healthcare, but we're not quite there yet.)

    --
    Velociraptor = Distiraptor / Timeraptor
  15. Re:not applicable by Zontar+The+Mindless · · Score: 2

    Can you please just stop posting until you've actually intelligent something to say?

    I do know about Breitbart, and that I can already go there anytime to read clueless nonsense like yours.

    Thanks!

    --
    Il n'y a pas de Planet B.
  16. Re:Good! by spun · · Score: 2

    Not anymore.

    --
    - None can love freedom heartily, but good men; the rest love not freedom, but license. -- John Milton