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GD POV: The Forgotten Middle Study

Recently, the National Investment Center for Seniors & Housing Care (NIC), and coauthors funded a study that examined an issue that not enough of the field is paying attention to: the “forgotten middle.” The authors define middle-income seniors as people unlikely to qualify for Medicaid long-term care, but not able to afford the current senior housing product offerings available to higher-income seniors.

Key Findings

  1. The NIC collaboration for The Forgotten Middle study focused for the first time on individual financial resources as opposed to household income. The methodology took into account all assets, but separated annuitized home equity from other assets. This is a more accurate financial model in terms of defining the need.
  2. This middle market will be heavily concentrated in the 75-to-84 cohort between now and 2029.
  3. While population is growing overall, the middle income segment of the market is growing fastest, and is projected to nearly double, increasing to 14.4 million by 2029.
  4. The demand for services and support will be high. 60% will have mobility limitation and 20% will have high health care needs.
  5. While many will need the services senior housing offers, 54% won’t be able to pay for it at current product levels because of lower overrall savings and fewer pensions.

Implications for Senior Living Marketing and Development

  1. With the study providing a much finer filter for consumer data and more specific understanding of this cohort, we must develop new approaches and products for this group.
  2. Not-for-profits wrestle with models that don’t provide multiple levels of care, so many are sitting on the sidelines, but an active group of progressive thinkers are working to change that. We’re seeing exciting prototypes and hearing conversations across the country about how to address this opportunity/need.
  3. For-profits are providing rental options for the top cohort of the middle market, but they’re still largely unaffordable for the lower cohort.
  4. Creativity, community partnerships and health care navigation to provide security are essential to a solution.

Read more about how to serve the senior living middle market and new approaches.

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