HOW CAN TECHNOLOGY SOLVE THE CHALLENGES OF AN AGING POPULATION?

In the coming years, the US elderly population 65+ will surpass the young population in majority. The current caresystems will not be able to sustain this increase due to 3 key problems: cost, access, and disconnect.

Aging in place is emerging as the best solution for both individuals and the government. It is more economic and more aligned with the needs of the elderly population.

• 89% of seniors wish to remain in their homes for as long as possible

• It would allow savings of $550k over 10 years for the individual and $2-$3 billion per year for the government.

Recent advancements in technology are the enablers for aging in place. Assistive technology for aging in place is expected to grow from $2 billion today to more than $20 billion by 2020.

Aging in place solutions should cater the needs at the crossroads of smart home and digital health:

• By 2019, the global smart home market will be $120 billion, with the US representing 17%. Almost 40% of households in the US will be equipped with smart home devices.

• The total revenues for connected health and wellness should amount to $8 billion dollar by 2018. Quantified self is a young market that is projected to increase by 4x fold in the next 4 years.

EXECUTIVE SUMMARY

The US population age 65+ was 44.7M in 2013 and represented 14.1% of the U.S. population. It is expected to grow to 21.7% of the population by 2040.

By 2060, there will be about 98 million elderly.

IN THE COMING YEARS, THE US ELDERLY POPULATION WILL SURPASS THE YOUNG POPULATION IN MAJORITY

2015 2040 2060

Baby Boomers

Baby Boomers Baby Boomers

Source: AARP 2015

1 in 4 elderly Americans live in one of threestates: California, Florida, and New York.

Illinois, Michigan, New Jersey, Ohio, Pennsylvania,and Texas —account for another one-quarter ofAmericans age 65 or older

80+ senior facilities are concentrated in Floridacounties (Marion County & Palm Beach County)

Louisville, Kentucky is a very big player in long-term care, being one of the "headquarters innursing home, rehabilitation, assisted living andhome health administration”.

SOME KEY LOCATIONS IN THE U.S. WHERE THE ELDERLY LIVE

THE CURRENT CARE SYSTEMS WILL NOT BE ABLE TO SUSTAIN THIS INCREASE DUE TO 3 KEY ISSUES 1) COST 2) ACCESS 3) DISCONNECT

COST

ACCESS

DISCONNECT

Being old is expensive• For the government through the healthcare programs of Medicare and Medicaid• For senior individuals and their families through out-of-pocket expenditures

The existing settings will not be able to absorb the increasing number of seniors and there will be a lack of care givers available

Seniors are both economically and emotionally burdened when they must leave their homes and are not allowed to maintain their preferred quality of life

At the federal level

The retirement of the baby boomer generation is driving costs for Medicare and Medicaid to unprecedented levels. Medicare will drive costs from 2016-2023, with an average annual increase of 7.3 %.

For this reason, the government is pushing for action to develop in-home health products, increase patient compliance, and improve disease prevention measures.

At the individual level

The older people get, the more healthcare they use, and the more personal costs they have from non covered medical bills

In 2009, 94% of people aged 65+ paid for a portion of their health care out of pocket.

THE CURRENT ECONOMIC MODEL TO SUPPORT THE ELDERLY POPULATION IS NOT SUSTAINABLE

COST

Source: PBS 2014, The Kaiser Family Foundation 2014

Americans rely a lot on family caregivers.

In 2015, around 43.5 million families provided care for anolder relative, and 14.9 million for a relative with Alzheimer’sor dementia.

Given the future population changes, the caregiver supportratio will decline from its 2010 level of 7 potential caregiversfor each person aged 80+ down to a ratio of 4:1 in 2030 and3:1 in 2050

Caregiver support ratio (CSR) – "the number of potential familycaregivers aged 45-64 for each person aged 80+"

WITHIN THE NEXT 15 YEARS, THE US WILL FACE A SIGNIFICANT LACK OF CAREGIVERS FOR ITS ELDERLY POPULATION

ACCESS

Source: AARP, 2013

ACCESS

THE 5 MAIN CARE SETTINGS FOR THE AGING POPULATION CAN BE BOTH VERY EXPENSIVE AND ARE ALMOST AT CAPACITY

Independent Living Community

Assisted Living Facility Residential Care Facility Continuing Care Communities

Nursing Homes

Capacity : 245,000 units

Largest single provider: Holiday Retirement with a

resident capacity of 40,440 and 315 retirement

communities

Capacity: 1,233,690 units

31,100 facilities

From 2007 to 2010, supply has increased almost 18 %

Capacity: 851,400 residents

713,300 actual residents22,200 facilities

Proportion of residential care communities with for-

profit ownership: 78.4%

Capacity: 570,000 units

350,000 actual residents

1,900 communities

Capacity: 1.7 Million residents1.4 million actual residents

15,700 nursing homes

Proportion of nursing homes with for-profit ownership:

68.2%

Source: AARP, 2012 ; Center for Disease Control & Prevention, 2012 ; Leading Age 2011

AGING IN THE PLACE IS THE IDEAL SOLUTION

AFFORDABLE

ACCESSIBLE

ACCEPTED

At an individual level, despite required remodeling costs, aging in place is significantly less expensive than senior care facilitiesAt a federal level, aging in place allows savings for both Medicaid and Medicare enabling savings of $45K annually per participant, or $2-$3 Billion total annually.

Most elderly people can remain in the house they’ve always lived in

Seniors need a stable lifestyle.

89% of seniors wish to remain in their homes for as long as possible with the key

reason being able to live under one’s own rules

Source: U.S. Department of Housing and Urban Development 2013

Aging in place is a growing movement that focuses on keeping seniors in their homes longer as they age. Onecore element of aging in place is allowing a person to maintain their quality of life. Evidence suggests thatprograms that support aging in place may yield cost savings for families, government, and health systems.

Aging in place has also been shown to have health and emotional benefits over institutional care.

Assistive domotics or internet of caring things are home automation technologies that focus on making itpossible for older adults and people with disabilities to remain at home, safe, and comfortable. This field usesmuch of the same technologies as home automation for security, entertainment, and energy conservation.

“Assistive technology for aging in place is expected to grow from $2 billion today to more than $20 billionby 2020.”

RECENT ADVANCEMENTS IN TECHNOLOGY AND ELDERLY TECH SAVINESS CAN MAKE AGING IN PLACE A REALITY

Source: AARP 2015, Infinaims 2016, Aging In Place Technology Watch 2012

SENIORS ARE CLOSELY TAILING THE GENERAL POPULATION IN TECH ADOPTION, AND GROWTH IS EXPECTED TO CONTINUE

91%

55%

43%

86%

70%77%

18%

27%

59%

47%

Cellphone Smartphone Tablet/eReader Internet Broadband

Tech penetration in the US, seniors vs general population (%)

All adults 65+

59%

47%

87%

76%

90%82%

Internet Broadband

Tech penetration in the US, seniors vs general elderly population (%)

All 65+ 65+ w/ college degree 65+ w/ >75k$ income

Source: Pew Research Center, Older adults and technology use, April 2014

State policymakers and agencies have taken various steps to enable aging in place, including integrating land use, housing and transportation; efficiently delivering services; providing more transportation choices; and improving coordination and communication among levels of government.

Certain land use policies can help older adults live closer to or within walking distance of the services they need• Integrating Land Use and Transportation Policy • Transit-Oriented Development (TOD)

Increased mobility options can reduce reliance on transportation by personal car• Volunteer Driver Laws • Human Service Transportation Coordination

Affordable, accessible housing can decrease institutionalization and meet consumer demand• Building Standards that Promote Accessibility • Naturally Occurring Retirement Community (NORC)

IN THE MEANTIME, STATE LEGISTLATORS ARE PUTTING IN VARIOUS POLICIES TO SUPPORT SUCCESSFUL AGING IN PLACE

Source: NCSL, Aging in place, 2011

Land Use

Transportation

Housing

This is not an exhaustive map, it highlights the trending states

Source: NCSL, Aging in place, 2011

IN THE MEANTIME, STATE LEGISTLATORS ARE PUTTING IN VARIOUS POLICIES TO SUPPORT SUCCESSFUL AGING IN PLACE

Homes with technologically advanced systems toenable domestic task automation, easiercommunication, and higher security.

Quynh Le, 2012

The smart home market will reach $120 billion by2019 — up from $33 billion in 2013.

Juniper Research 2014

All healthcare-related applications, technologiesand delivery systems that result from theconfluence of medicine, genomics and thetechnologies that comprise the digital space.Digital Health makes use of interconnectedtechnologies to embrace the entire spectrum ofhealthcare providers, consumers and researchers.

Nuviun, 2014

The Digital Health industry is a conglomerate ofmany industries and is expected to exceed $200billion globally by 2020.

Arthur D Little, 2014

AGING IN PLACE IS AT THE CROSSROADS OF SMART HOME AND DIGITAL HEALTH, TWO BOOMING SECTORS

Smart Home Digital Health

TECH ADVANCEMENTS HAVE LED TO A HORIZONTAL GROWTH FOR THE SMART HOME MARKET, NOW INTERSECTING WITH THE DIGITAL HEALTH MARKET

"Home is the fastest growing setting for healthcare“Rick Valencia, Sr. Vice President Qualcomm & General Manager, Qualcomm Life

Digital HealthSmart Home

Communications To contact loved ones To contact emergency services

Smart sensors To keep track of daily activities To check adherence to a medication regimen

Safety To detect burglary To detect falls & shocks

Lighting To adapt lighting to user’s activities To help seniors with vision deficiency

Source: The Future of Healthcare, 2015

Government

AGING IN PLACE HAS BOTH PRIVATE & PUBLIC AND FOR PROFIT & NON PROFIT STAKEHOLDERS THAT COMPANIES NEED TO BE AWARE OF

SENIOR CITIZENS AND THEIR FAMILIES

45M PEOPLE Associations/Non Profit

Senior Care

Settings

Independent Living Community

Assisted Living Facility

Residential Care Facility

Continuing Care Communities

Nursing HomesHealth Care Providers

NursesHospitals

Clinicians

Solution Providers

Personal Communication

Home Safety

Health Care

AGING IN PLACE IS COMPRISED OF 3 KEY SEGMENTS THAT ARE SCATTERED WITH BOTH INCUMBENTS AND YOUNG STARTUPS

SUCCESSFUL AGING IN PLACE SOLUTIONS CAN FACILITATE REMOTE CARE GIVING, HOME SAFETY, AND HEALTH CARE

Remote MonitoringMedication remindersDaily medical testingMedical care coordination

Healthcare

Fall preventionSecurityLighting

Home Safety

Remote Caregiving

Family caregiving coordinationCommunicationRelationshipsFighting loneliness

Source: Infiniaims 2015

Personal Communication Home Safety Health Care

Must have • Easy onboarding• Accessible from any device• User friendly • Includes phone & video calls

• Immediate detection• Alerts & notifications

• HIPAA compliant• Medical grade

Should have • Text messages• Cost effective

• Easy onboarding• Customer support 24/7• User friendly • Data analytics • Highly customizable• Nice design• Long range device coverage• Cost effective

• Easy onboarding• Accessible from any device• Customer support 24/7• User friendly • Data analytics • Highly customizable• Long range device coverage• Cost effective

Would like to have

• Customer support 24/7• Includes all forms of communications• Nice design

• Accessible from any device • Includes all forms of communications

• Nice design

PERSONAL COMMUNICATION IS DRIVEN BY CONVENIENCE WHILE HOME SAFETY & HEALTH CARE ARE DRIVEN BY RELIABILITY & ACCURACY

More than ⅓ of those aged 65+ live alone and the percentage rises with age.

One third of informal caregiving occurs at a distance with family members coordinating provision of care, maintenance of independence, and socialization for frail elders living at home.

1. Better communication2. Improved safety and monitoring3. Greater focus on wellness and prevention4. More opportunity to participate in society

WHAT WILL IT TAKE TO SUCCESSFULLY AGE IN PLACE

National Institute of Nursing Research, NIH, 2015