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Cost of Dementia Care, Already High, Will Only Soar

Comprehensive, new research estimates that today's $200 billion tab will more than double in 30 years

By Gary Drevitch

Caring for older Americans with dementia is already more expensive than caring for those with cancer or heart disease — and the cost is rising dramatically, according to a major new study seen as the most comprehensive to date on a crisis expected to affect millions of families nationwide in the years ahead.

The study, published Thursday in The New England Journal of Medicine, estimated that care for Americans with dementia, including those with Alzheimer's disease, cost between $159 billion and $215 billion in 2010. But that huge outlay could more than double by 2040, say the authors of the study, which was financed by the federal National Institutes of Health and produced by RAND Corporation and University of Michigan researchers.

The research team expects that longer life spans and advances in treatment of other conditions, as well as a rising tide of aging baby boomers, will spur even greater demands for private and long-term residential care, pressuring the system further. The new study said dementia-care costs in 2040 could range from $379 billion to $511 billion.

(MORE: How Family Caregivers Can Find and Hire at-Home Help)

"Unless effective interventions are found to treat Alzheimer's," Richard Suzman, director of the federal National Institute of Aging's Division of Social and Behavioral Research, said in a release, "formal long-term dementia care costs will escalate for the baby boom generation, as they have fewer children available to provide unpaid, informal care."

The study calculated medical and caregiving expenses. Direct costs of dementia care — including nursing home and Medicare payments and out-of-pocket medical fees — totaled $109 billion in 2010, surpassing direct costs for treating heart disease or cancer. But the report's estimates of informal costs, mostly for family and at-home caregiving, nearly doubled that figure. The total tab for dementia care per patient in 2010 was estimated at $41,000 to $56,000.

The Census Bureau predicts that the number of Americans 65 and older will double over the next 20 years. Experts see no treatment on the horizon that will slow the rate of dementia in that group, and so costs of dementia care should double as well. The study, focused only on people over 70, reported that 14.7 percent of the U.S. population that age now live with dementia, about 3.8 million in all. That number is expected to swell to 9.1 million by 2040.

Well aware of the looming costs, the federal government has devoted new resources to attacking dementia through its National Plan to Address Alzheimer's Disease. "It is a dedicated battle on many fronts," NIH Director Francis Collins said in a statement, "including capitalizing on research opportunities now before us."

Earlier this month, President Barack Obama released details of the government's BRAIN initiative, a separate, long-term investment in brain science, which Collins said "will use a new generation of tools to help us learn the secrets to many neurological disorders, including Alzheimer's disease."

(MORE: The U.S. vs. Alzheimer's: The Fight Heats Up)

The new analysis, while similar to other research prepared by groups like the Alzheimer's Association, was immediately recognized as the most reliable estimate yet of the nation's growing dementia crisis. It was based on data from the federal Health and Retirement Study, a large-scale, long-term survey of people 51 and older, which is funded by NIH's National Institute on Aging and the Social Security Administration.

People with Alzheimer's and similar conditions typically have other health concerns as well, so breaking down dementia-related expenses had previously proven to be a challenge for researchers. The new study involved fresh clinical assessments of dementia for 856 subjects age 71 and older in the Health and Retirement Study group, which were then combined with earlier analyses of cognition and costs for more than 10,000 others to extrapolate national dementia rates and expenses. Analysts separated health-care costs unrelated to dementia from their calculations.

The study's authors acknowledged there may be millions of other older Americans with milder forms of cognitive impairment that do not meet the clinical definition of dementia. Those individuals, however, may still incur expenses through in-home or family caregiving.


"People with dementia do not get much more additional health care services than other people," Michael Hurd, lead author of the new study and director of the RAND Center for the Study of Aging, said in a statement. "The real drivers of the cost are for non-medical care."

Indeed, 75 to 84 percent of the money spent on dementia patients is committed to family caregiving or long-term residential care, according to the study.

(MORE: New Report Highlights the Stress of Long-Distance Caregiving)

"People eventually become incapable of caring for themselves," Donald Moulds, acting assistant secretary for planning and evaluation at the federal Department of Health and Human Services, told The New York Times, "and then in the vast majority of cases, their loved ones become incapable of caring for them."

The inescapable conclusion is that American families are unprepared for what lies ahead. Dr. Ronald Petersen, director of the Alzheimer’s Disease Research Center at the Mayo Clinic, believes the new study's conclusions may ultimately prove to be too conservative. "I think they’re kind of lowballing things," he told the Times. The demands of dementia care, he added, are going to "swamp the system."

The Alzheimer's Association believes the future costs of dementia care are going to be even higher, as much as $1.2 trillion by 2050. That estimate is based in part on the group's expectations that people with dementia in the years ahead will have longer lives because of improved medical care for other conditions.

No matter how the numbers are crunched, there are no signs that the nation's dementia care bills will decrease, Hurd said. "The nation will have a larger number of 85-year-olds in the future than we do today," he pointed out. "Unless there is some sort of medical breakthrough, these costs will continue to rise."

(MORE: Early Alzheimer's Detection: Is It Worth Knowing?)

When analyzing the impact of dementia on communities, there are other significant, but harder to calculate, expenses for spouses, children and others who will spend years looking after affected loved ones. "We have not measured the emotional costs of dementia, which are bound to be enormous," Hurd said. "We need to step up efforts to identify ways to effectively treat and prevent this devastating disease. It inflicts a large and growing cost to patients, families and public programs, so it requires research and public policy investments that are in line with those currently being made for other major diseases."

Gary Drevitch was senior Web editor for Next Avenue's Caregiving and Health channels. Read More
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