the cost of dementia care in the United States
April 5, 2013

True Cost Of Dementia Has Been Underestimated

Jason Pierce, MSN, MBA, RN for — Your Universe Online

Researchers at the University of Michigan Health System and the RAND Corporation report that in the United States the annual healthcare expenses associated with dementia exceed those associated with heart disease or cancer.

According to the report, published in the New England Journal of Medicine, the total annual cost of dementia care in the United States ranges from $159 billion to $215 billion. This estimate includes direct patient care expenses of $109 billion, and as much as $106 billion in informal or unpaid care.

The study was funded by the National Institute on Aging and the Social Security Administration, and is the most comprehensive study of its kind related to the costs of dementia. The data comes from a nationally representative sample of individuals over the age of 50 participating in the Health and Retirement Study, and has been collected since 1992.

Dementia is a progressive disease process involving loss of brain function effecting memory, language, though processes, and judgment. This decline in mental capacity impairs the ability to perform activities of daily living and self-care. Alzheimer´s disease is the most commonly known form of dementia.

The report found that the $109 billion spent on direct care for dementia in 2010 was consistent with the $102 billion spent on heart disease. Cancer care, however, had a lower price tag of $77 billion. Direct care costs include those related to formal care provided by physicians and nurses, Medicare expenses and other out of pocket expenses. Medicare reportedly spends about $11 billion on dementia per year.

When informal care, such as that provided at home by family members or in long term care facilities, is included the annual cost of dementia balloons to as much as $215 billion. According to the authors, "The majority of the costs associated with dementia – about 80 percent in our study–are due to the long-term daily care and supervision provided by families and nursing homes, often for many years. Ignoring these long-term care costs that build up steadily day-after-day leads to a huge under-counting of the true burden that dementia imposes on our society."

Based on statistics from 2010 the study estimates that as many as 14.7 percent of Americans over 70 have some form of dementia. As the US population ages the cost associated with dementia will rise. Some estimates suggest that the cost could more than double by the year 2040. "There are no signs that the costs of dementia will decrease given that the nation will have a larger number of 85-year-olds in the future than we do today," said Michael Hurd, the study's lead author and a senior economist at RAND. "Unless there is some sort of medical breakthrough, these costs will continue to rise."

According to Hurd, “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."