The Death Tax The Economics of Death: Crash Course Econ #30

Published on Apr 16, 2016

We need to have a talk about your future. You’re going to die. We all are. And it’s probably going to be expensive. This week on CC Econ, Adriene is talking about the economics of death. Some of the expense is tied to the cost of end-of-life health care, but funerals are a big business, too.

Death Tax

0:00hi I’m Adrian help this is crash course economics and today we need to have a
0:04little talk about a subject that most people try to avoid death we’re all
0:08going to die now I know from our demographic analytics that most of you
0:12are young and your statistically likely to live quite a bit longer but it’s
0:17still gonna happen someday and how and when we die has some significant
0:21economic impacts so let’s listen to the crash course on watch the credits have a
0:26school existential crisis and then we’ll get down to the economics of death
0:37let me start by pointing out that my co-host Jacob isn’t anything Canada
0:44where he’s writing a textbook and making me cum videos for his YouTube channel
0:47ac/dc leadership and probably still wearing ECDC belt buckles everyday now a
0:54couple of disclaimers one this is not crash course philosophy we’re not gonna
0:58get into the moral issues surrounding death we don’t know what happens to you
1:02after you die
1:03although we will talk a little about what happens to your money after you die
1:06too we’re going to focus on how death and dying impact the economy of the
1:10united states and it’s not because we’re American exceptionalism or something
1:14it’s because we read and write in English and information on the USS is
1:18readily available to us we know that attitudes and practices around death
1:21differ throughout the world but most of our conversation is going to focus on
1:25death in America and is not death to America we focused on that and world
1:30history
1:30alright a little bit news on the whole throughout the world life expectancy at
1:34birth has been increasing according to the United Nations the global average
1:38life expectancy has risen from 65 years for people born between 1990 and 1995 to
1:45seventy years for those born between 2010 and 2015 but there are still some
1:50pretty big disparities people born in Africa have a life expectancy at birth
1:54that’s twelve years less than the global average and twenty-one years the number
2:00for those who live in North America so that’s not great in the United States
2:04life expectancy has changed dramatically in the last 50 years americans live
2:09longer than they used to and more and more of them died of natural causes
2:12accidents and murder and violent death in general are way down people are
2:18living longer the Pew Research Foundation reports that by 2010 in the
2:22United States 31 percent of deaths were among those aged 85 and older
2:27this was a huge change from 1968 when twelve and a half percent of people who
2:32died were in that age range it’s not all roses though I mean this is still an
2:36episode about dying when we look at this data by income level the numbers look a
2:41little different
2:42a recent study found that income levels affect life expectancy a lot in 2010
2:48and upper-income men in the USA was expected to live to age 89 the same
2:53lower-income man with live 276 and the shorten lifespan has a big economic
2:59impact in effect the rich receive a lot more government benefits over the course
3:04of their lives that 89 year old upper-income men would collect an
3:08average of five hundred twenty-two thousand dollars in government benefits
3:12during his life while the lower income would only collect an average of 300
3:16$91,000 so how do are on average longer lives affect the economy well economic
3:23thought about this stuff berries some economist argue that increase lifespans
3:27are in a very basic sense good for the economy where people live longer they
3:32have more years to consume stuff contributing to economic growth on the
3:35other hand long life tends to come with more health problems and memory related
3:39illnesses have become much more prevalent in 1968 the Centers for
3:44Disease Control and Prevention documented 293 dust from dementia
3:49senility and Alzheimer’s in 2010 those illnesses accounted for more than a
3:54hundred eighty thousand deaths the CDC also reports five million Americans
3:59suffer from Alzheimer’s and dementia in 2013 and that number was projected to
4:03rise as high as 13 point eight million by 2050 people with Alzheimer’s can live
4:09for a long time with the disease and they need a lot of care which is
4:13expensive
4:14the cost of caring for patients with Alzheimer’s and dementia was two hundred
4:17billion dollars in 2012 and those costs could rise as high as a trillion dollars
4:23by 2015 that’s a lot of money as you’ll recall from our economics of health care
4:28episode the USR he has the highest per capita health care spending in the world
4:33and end of life care accounts for a huge part of that spending in 2012 fifty
4:39billion dollars of medicare spending covered care for patients during the
4:43last two months of their lives and that doesn’t account for the cost that
4:47families absorbed caring for dying family members at home
4:50medicare doesn’t cover all the costs of health care and direct care from family
4:54members often results in lost wages it’s also worth asking exactly what we’re
5:00buying with all this money
5:01surveys
5:02decay that the vast majority of people would prefer to die at home but more
5:06than seventy percent of Americans died in nursing homes or hospitals patients
5:10often end up receiving a tremendous amount of care at the end of their lives
5:15the question we need to ask ourselves is whether that intense and expensive level
5:19of care improves life or simply prolong suffering the answers to those questions
5:24tend to be mixed and here we stray into the thorny territory of medical ethics
5:29studies indicate that many doctors and patients are uncomfortable with the idea
5:34of having cost of care
5:36factored into end of life decisions no one wants to be denied a course of
5:40treatment based on budget concerns one widely agreeable option for cutting
5:44costs and end of life care has grown out of a movement meant to improve the
5:48quality of people’s in the life experience hospice and palliative care
5:53treat patients symptoms and manage their pain as they die rather than performing
5:58more and more procedures in an attempt to prolong life in 1982 the United
6:03States passed a law that allowed medicare cover hospice benefits for
6:07patients with terminal illnesses while studies indicate that expanded access to
6:11Hospice and Palliative Care do work to lower into life costs they’re by no
6:16means a single solution to rising expenditures for now though let’s put
6:21aside the complex mysteries of american health care costs and agree that dying
6:25is expensive and we haven’t even started counting what it costs to actually be
6:29dead once we get beyond the costs associated with dying we’re still left
6:33with a cost of disposing of our bodies let’s talk about what happens to you
6:37when you died and how much it costs and the thought but according to the
6:42National Funeral Directors Association the median price for a funeral with
6:45viewing and burial in the United States with 7181 dollars in 2014 the median
6:53price of a cremation
6:54and funeral was 6078 dollars and while the two seemed comfortable the cost of
7:00burial are quite a bit higher as that 7181 dollars

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