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NIH-supported study finds U.S. dementia care costs as high as $215 billion in 2010

Formal and unpaid dementia care costs are tallied



April 4, 2013

Peggy Vaughn | 301-496-1752 | nianews3@mail.nih.gov



The costs of caring for people with dementia in the United States in 2010 were between $159 billion to $215 billion, and those costs could rise dramatically with the increase in the numbers of older people in coming decades, according to estimates by researchers at RAND Corp. and the University of Michigan, Ann Arbor. The researchers found these costs of care comparable to, if not greater than, those for heart disease and cancer.

The study, supported by the National Institutes of Health and published April 4 in The New England Journal of Medicine, totaled direct medical expenditures and costs attributable to the vast network of informal, unpaid care that supports people with dementia. Depending on how informal care is calculated, national expenditures in 2010 for dementia among people older than 70 were found to be $159 billion to $215 billion. Dementia is a loss of brain function that affects memory, thinking, language, judgment, and behavior; the most common form is Alzheimer's.

The researchers first looked at care purchased in the health care market - formal costs for nursing homes, Medicare, and out-of-pocket expenses. They found direct costs of dementia care purchased in the market were estimated to be $109 billion in 2010. Those costs, they said, exceed direct health costs for heart disease ($102 billion) and cancer ($77 billion) that same year.

Adding informal, unpaid care to the equation as much as doubled the estimated total national costs for dementia care. The study estimated full costs per case of dementia in 2010 at $41,000 to $56,000. The lower number accounts for foregone wages among caregivers, while the higher figure valued hours of informal care as the equivalent of formal paid care. The range of national expenditures was tallied based on an estimated prevalence of dementia of 14.7 percent in the U.S. population older than 70.

The researchers also project skyrocketing costs as the baby boom grows older; the Bureau of the Census estimates that the population age 65 and older will double to about 72 million over the next 20 years. Rates of dementia increase with age, and unless new ways are found to treat and effectively prevent it, national health expenditures for dementia could come close to doubling by 2040, as the aging population increases and assuming the rate of dementia remains the same.

"These findings reveal that the enormous emotional and physical demands of caring for people with dementia are accompanied by the similarly imposing financial burdens of dementia care," said Richard J. Hodes, M.D., director of the NIH's National Institute on Aging (NIA), which funded the analysis. "The national costs further compel us to do all we can to find effective treatments for Alzheimer's disease and related dementias as soon as possible."

The complex analysis is one of the most comprehensive yet to determine health care costs for dementia. It is based on a nationally representative sample from the Health and Retirement Study (HRS), a survey of people 51 years and older that is funded by the NIA with contributions from the Social Security Administration. Interest in national health expenditures for Alzheimer's disease and related dementias has intensified with the January 2011 signing of the National Alzheimer's Project Act (NAPA) (PDF, 124K), which calls for stepped up efforts to find new treatments and to improve care and services. Under NAPA, the Administration is leading development and implementation of a National Plan to Address Alzheimer's Disease, under which new research studies, the new web portal www.alzheimers.gov, and new clinical training initiatives have moved forward.

"We are just entering the second year of our national plan to fight Alzheimer's disease," said NIH Director Francis Collins, M.D. "It is a dedicated battle on many fronts, including capitalizing on research opportunities now before us. The new BRAIN initiative announced by the President just this week, for example, will use a new generation of tools to help us learn the secrets to many neurological disorders, including Alzheimer's disease."

Identifying costs of dementia has been challenging. People with Alzheimer's and other dementias are typically older and often have multiple medical conditions, such as stroke and depression, diseases commonly co-occurring with dementia. It is also difficult to capture the national costs of family-provided or other informal care. To overcome such barriers, the researchers focused on dementia rates and costs among volunteers older than 70 participating in a sub-study of the HRS, the Aging, Demographics, and Memory Study (ADAMS). For this analysis:

  • Some 856 ADAMS volunteers received a three- to four-hour in-home clinical assessment for dementia. An expert panel reviewed the test results to determine who was demented, cognitively impaired but not demented, and normal.
  • Researchers then used these data to determine the national prevalence rate, and previously collected cognitive and functional measures on 10,903 people in the full HRS sample of people older than 70 to estimate dementia care costs based on the use and costs of health care services reported by this same group.

"Dementia costs currently rival those of cancer and heart disease. But, within 30 years, dementia may be in a league of its own," said Richard M. Suzman, Ph. D., director of NIA's Division of Social and Behavioral Research. "Unless effective interventions are found to treat Alzheimer's, 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 NIA leads the federal government effort conducting and supporting research on aging and the health and well-being of older people. It provides information on age-related cognitive change and neurodegenerative disease specifically at its Alzheimer’s Disease Education and Referral (ADEAR) Center at www.nia.nih.gov/Alzheimers. For expanded information on Alzheimer’s care and resources, please visit the federal government’s portal website www.alzheimers.gov. Information on health and on aging generally can be found at www.nia.nih.gov. To sign up for e-mail alerts about new findings or publications, please visit either NIA website.

About the National Institutes of Health: NIH, the nation's medical research agency, includes 27 Institutes and Centers and is a component of the U.S. Department of Health and Human Services. NIH is the primary federal agency conducting and supporting basic, clinical and translational medical research, and is investigating the causes, treatments and cures for both common and rare diseases. For more information about NIH and its programs, visit www.nih.gov.

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