Executive Briefing | by Monica E. Oss | May 13, 2017
When you look into the number of people with disabilities in the United States, a couple of things become clear:
Let’s start with the broadest measure: In the 2010 U.S. Census, about 56.7 million people — nearly 20% of the population — reported having a disability of some kind, which also included issues with vision and hearing. About half of that group said their disability was “severe.” Both of those numbers have almost certainly gone up in the past seven years (along with the general population), but by how much? And what does that really mean for the health and human service field?
We can get additional insight from Centers for Disease Control and Prevention (CDC) research, which examined the prevalence of disabilities among U.S. working-age adults between 2011-2014 (see Adults With One Or More Functional Disabilities, United States, 2011-2014). According to that report, 11.9% of all working-age Americans (22.6 million people overall) have at least one disability. Within that group, 4.1% of Americans (or 38.3% of people with disabilities) have a cognitive disability.
The CDC also has relevant numbers for adults who are 65 and older, who may or may not be working in some capacity. While they aren’t categorized, strictly speaking, as “people with disabilities,” 3.4% of adults between the ages of 65 and 74 and 12% of adults 75 years and older need some kind of assistance with personal care. Additionally, about 26 million adults (approximately 61% of the total population) in 2014 had difficulty with at least one basic action or a limitation around a complex activity.
About 5.5 million Americans are also estimated to have Alzheimer’s dementia in 2017. Of those, the vast majority — 5.3 million — are age 65 and older. About 200,000 with early onset Alzheimer’s disease are under age 65. At the current pace, the number of people age 65 and older with Alzheimer’s disease is expected to nearly triple by 2050, reaching a projected 13.8 million by that year (see 2017 U.S. Health Care Costs For Dementia Expected To Total $259 Billion).
And finally, over the next 10 years about a half a million youth with autism spectrum disorder (ASD) will enter adulthood (see 500,000 Youth With Autism Will Enter Adulthood By 2025). The majority of the costs in the U.S. health care systems for ASD are directed at the adult population: $175 to $196 billion for adults compared to $61 to $66 billion for children (see Finding The Opportunities In Serving The 1 In 68).
So the big question? How do your reduce these “big picture” numbers to a sustainable new service line? The answer to this question is what separates organizations with a more disciplined market-informed strategy development process from the rest of the pack. When I’m working with organizations on diversification and new service line strategies, I recommend a few steps.
First, reduce the “big picture” numbers to local demand. There are fairly large disparities (see Do U.S. states’ socioeconomic and policy contexts shape adult disability?) in the distribution of disabilities by state. The states with the lowest rate from 2010-2014 were Minnesota and North Dakota with 12.9% each, and the one with the highest rate was West Virginia at 23.5%. You can “crunch the numbers” on market potential in any location. It’s the basic math.
Second, understand the needs of that population to estimate demand for specific types of services or solutions. This isn’t the number of consumers with a particular support need. It’s the number of consumers who will use a specific type of service to meet their support need. And, don’t forget that you want to understand the paid demand for services. Unfortunately, in the U.S. health and human service system, what people want and need is different from what is reimbursed by third-party payers.
Third, for the specific service or solution you have in mind, assess the competition. There are two processes. First, the quantitative – an inventory of competitive organizations and their service capacity. The second is some in-depth interviews with potential payers about what their consumers need, what organizations are meeting that need now, and whether and for what reasons they would use a new service.
If your new service idea survives these three initial market tests, you can move to a formal feasibility analysis to make a go/no go decision (see Expanding Your Organization’s Core Programming: Using Program Feasibility Analysis to Make Service Line Decisions) – and then use a structured stage-gate or phase-gate approach to new service line development that allows you to “fail fast and cheaply” if necessary (see From Innovation To Action: Why Structured & Rapid Service Line Development Is A Critical New Competency).
There is certainly opportunity in the increasing prevalence of disability in the U.S. population. And, the “expert” predictions in the space are striking. The prevalence of cognitive disabilities will rise as the means and frequency of testing improve. As the number of Americans 65 and older gets bigger, so will the number of people with disabilities. Prevalence of disabilities in the healthiest states will remain relatively stable, but will grow in the unhealthiest states. All market trends that should have every management team looking at new service lines in these areas.
For more, mark your calendar for August 15 for The 2017 OPEN MINDS I/DD Executive Summit in Long Beach, featuring David Braddock, Ph.D., Executive Director, Coleman Institute for Cognitive Disabilities at the University of Colorado and his keynote address, “Emerging Best Practices In Medicaid Managed Care Long-Term Supports & Services: Trends Shaping The Market.”