U.S. Dementia costs to exceed $780 billion this year

(Press-News.org) The total economic burden of Alzheimer’s disease and related dementias in the United States will reach $781 billion this year, according to new USC-led research.

This is the first of what will be annual national estimates from the multidisciplinary research team. The team aims to provide the most comprehensive accounting yet of dementia’s growing economic toll. Beyond the cost of care, the model also accounts for lost earnings from patients and care partners who cut back work hours or leave jobs, as well as the diminished quality of life experienced by millions of patients and their families, among other factors.  

“Having a better understanding of who bears these costs and how they change over time can inform evidence-based policies that may ultimately reduce the financial impact of dementia,” said Julie Zissimopoulos, co-director of the Aging and Cognition program at the USC Schaeffer Center for Health Policy & Economics and professor at the USC Price School of Public Policy, who is principal investigator of the U.S. Cost of Dementia project.

Funded by a multi-year cooperative agreement from the National Institute on Aging (which is part of the National Institutes of Health), the project leverages data from several large, nationally representative surveys, including from the Health and Retirement Study and administrative health data from the Centers for Medicare and Medicaid Services. The researchers estimate costs to patients, care partners and the healthcare system using dynamic microsimulation — a powerful tool for understanding how changes in treatment, care and policy will impact costs of dementia over time. 

An estimated 5.6 million Americans are living with dementia this year, including 5 million who are 65 and older, according to the researchers. Medical and long-term care for patients with dementia will cost the United States $232 billion this year, including $52 billion paid out of pocket by patients and their families. More than two-thirds of the total cost of care is paid for by Medicare ($106 billion) and Medicaid ($58 billion).

Dementia’s societal costs are even more staggering, the model reveals. The largest share stems from a factor often not measured in other cost estimates: The significant decline in quality of life for patients ($302 billion) and care partners ($6 billion). Lost earnings among friends and family who forego work to provide care — another measure often not captured by other estimates — total $8.2 billion. Care partners provide 6.8 billion hours of unpaid care, valued at $233 billion.

“This research demonstrates the enormous toll dementia places on patients, their families and care partners. But it also points to the potential value of developing ways to prevent and treat Alzheimer's and related diseases that cause dementia,” said Dana Goldman, founding director of the USC Schaeffer Institute for Public Policy & Government Service and co-principal investigator on the project.

An ongoing look at dementia’s changing costs

The clinical resources available to tackle dementia are rapidly changing. New treatments slow cognitive decline in some patients with early-stage Alzheimer’s, and new blood tests are enabling early detection of Alzheimer's.

The USC-led research team is building tools to help researchers and policymakers understand how these and future evolutions in dementia care, prevention and policies can affect costs for patients, the healthcare system and society. This information will support stakeholders in making decisions about priorities and the allocation of resources for reducing the costs of dementia.

To draw on a wide range of perspectives, the research team includes prominent experts across disciplines at USC — including the Schaeffer Center, the Price School of Public Policy, the Mann School of Pharmacy and Pharmaceutical Sciences, the Davis School of Gerontology and the Viterbi School of Engineering — as well as the Alzheimer’s Association and the University of Pennsylvania. Researchers from other institutions provide additional guidance, and patients and care partners are regularly consulted to ensure the cost model reflects real-world experience. 

Going forward, the project will seek to uncover all types of costs to provide the most comprehensive estimates of the national cost of dementia to date.

The U.S. Cost of Dementia Project is funded by a cooperative agreement with the National Institute on Aging, part of the National Institutes of Health (#U01AG086827).

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