Things today are about as good as they are going to get for older Americans, says the nation's leading lobbying group for the 50+ population.

Yes, older Americans are better off than they where a decade ago, says AARP. But over the last three years the economic, health and social well-being of the 50+ crowd has gone from bad to worse, despite a recovery in the stock market in 2004 and an increase in the value of real estate, according to the group's third annual "report card" on conditions for older Americans.

And the future, given rising health-care costs and falling savings rates, seems a bit bleak.

To be fair, not all of the indicators that AARP tracks have turned negative over the past year. In fact, some might say the glass is currently half full versus half empty. Eleven indicators turned negative and positive changes totaled 10 in this year's report. But the negatives are substantial, especially the health indicators, said John Rother, AARP's director of policy.

"Americans age 50 and older seem to be doing better financially, but feeling worse," the report said. Click here to read the report.

For example, the percent reporting their health as excellent or very good declined, as did drug coverage for Medicare beneficiaries, the percent able to afford health care, the percent who were not obese and not overweight and (perhaps related) the percent who engaged in physical activity.

But the real problem is the adverse effect health-care expenses have on family income. Median family income adjusted for inflation fell to $35,199 in 2004 from $35,746 in 2003.

"We do have overall growth," said Rother. "But it's not translating into family income. The haves are getting richer and ordinary people are seeing their wage gains go to rising health-care costs."

Rising health-care costs have become, according to AARP CEO Bill Novelli's reaction to President Bush's State of the Union address last night, a "hidden tax" on all individuals, businesses, the states, and the federal government. "We cannot afford to continue to ignore this problem," Novelli said in a statement.

Unfortunately, Rother said there's not much families or individuals can do to reduce the impact of rising health-care costs on their budgets.

Sure, individuals can take better care of themselves, he said. Obesity and smoking are among the obvious things that could be addressed.

And individuals could create what Rother calls a "medical home." In other words, individuals could work with a doctor who is familiar with a person's entire medical history and coordinates all medical care. And individuals who are taking lots of prescription drugs could do more to make sure that they understand side effects and potential drug interactions.

But those things won't do much to cushion rising health-care costs, Rother said. Instead he said lawmakers and the health-care industry must do more to help Americans fix what is and what will likely continue to be the biggest burden on older Americans' well-being.

For instance, Rother said the U.S. spends twice as much on health care as any other country yet Americans have no better health prognosis than in many other countries. "We don't have much to show for all that extra money," he said, noting that 45 million Americans don't have health insurance.

Among other things, Rother said more could be done to improve the efficiency of the health-care industry's back office. Plus, he said that an "amazing" amount of money is ill-spent on health-care advertising. "We need to have a more integrated approach," he said. "Today, it's a system where some pieces work together and others don't."

President Bush did this week propose (and AARP praised his efforts) to start to modernize the health-care system by advancing health-information technology and reducing medical errors. "These initiatives can help to reduce costs, improve care and make the system more efficient for consumers," AARP said.

But that and then some must be done to help improve the well-being of older Americans.

"Despite modest progress in the state of 50+ America over the past decade, the future remains uncertain for several reasons," says the AARP report. "Individuals are being required to take more responsibility for their own retirement, traditional pensions are in decline even as overall coverage inches up, retiree health benefits are being reduced or eliminated, the stock market is stagnant, and threats to partially privatize Social Security, although they were turned back in 2005, are likely to resurface."

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