Caring for people with dementia is costing up to $157 billion each year in the U.S., which makes the disorder more expensive than treatments for heart disease and cancer.

The finding came from a new study conducted by the RAND Corporation, a nonprofit organization that helps improve policy and decision-making through research, and was published in the New England Journal of Medicine.

Dementia is a chronic disease of aging that results in progressive cognitive decline which can severely undermine independent functioning. The disease includes Alzheimer’s and other illnesses.

The largest financial cost of dementia is not drugs and other medical treatment. It is the task of taking care of the patients either in nursing homes or in their own homes.

This is the most comprehensive study conducted in recent years on the costs of dementia, according to the authors.

The prevalence of dementia is strongly associated with age, and according to the experts, the financial toll of dementia could double by 2040 if the age-specific prevalence rate of the disease stays constant as people live longer.

Michael Hurd, lead author and a senior economist at RAND, said:

“The economic burden of caring for people in the United States with dementia is large and growing larger. Our findings underscore the urgency of recent federal efforts to develop a coordinated plan to address the growing impact of dementia on American society.”

The Alzheimer’s Association has previously reported lower cost estimates than the ones in the new study. The economic strain placed on people as a result of dementia is more clearly portrayed in this report.

According to scientists, this is because the new study:

  • excludes costs associated with other illnesses suffered by dementia patients
  • uses a better approximation of the incidence of the disease
  • accounts for variations in the severity of dementia

The National Alzheimer’s Project Act was signed by President Obama in 2011. The law demands that efforts are raised to discover novel treatments and to better care for patients with dementia. It also calls for the economic toll of the disease to be tracked.

The new research used data from the Health and Retirement study, an ongoing survey of Americans aged 51 and older which started in 1992. A subset of those participants were given a comprehensive clinical evaluation for dementia at their home as part of the Aging, Demographics and Memory Study, a nationally representative assessment of dementia in the U.S.

An evaluation was included in the survey to determine whether patients could dress themselves, prepare their own food, and perform other daily activities.

The subjects were also asked about the health care expenses they paid out-of-pocket for services like home health care, nursing home stays, and other medical services.

Whether or not they received help from other people for their daily living activities was also addressed. For the majority of volunteers, medicare spending information was associated with medical claims.

In 2010, about 14.7% of people in the U.S. aged 71+ years were affected by dementia, according to the report. However, that number is much lower than what has been found in previous, smaller studies.

The scientists said:

“The total economic cost of dementia in 2010 was estimated to be $109 billion for care purchased, and $159 billion to $215 billion when the monetary value of informal care is included. The range of estimates reflects two different methods researchers used to place a value on unpaid care. The per-person cost of dementia was $56,290 or $41,689. Medicare paid about $11 billion of dementia-related costs.”

The costs for institutional and home-based long-term care are mainly responsible for the dementia costs, rather than drugs and other medical treatments. Seventy-five to 84% of dementia costs are for nursing home care, and formal and informal care at home.

A previous study presented at the International Conference on Alzheimer’s Disease revealed that outpatient costs can be reduced by nearly 30% with an early diagnosis followed by information and support.

“People with dementia do not get much more additional health care services than other people,” Hurd explained. “The real drivers of the cost are for non-medical care.”

The cost of dementia care purchases ($109 billion) was comparable to the estimates of the direct health care costs for heart disease ($102 billion) and were considerably greater than the direct health costs for cancer ($77 billion).

The researchers pointed out that costs for heart disease and cancer did not include informal care costs, which is likely to be substantially higher for dementia.

Hurd concluded:

“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. Unless there is some sort of medical breakthrough, these costs will continue to rise.”

A UK report from 2010 indicated that the burden of dementia on the nation’s economy is twice that of cancer, however, dementia research receives less funding.

Written by Sarah Glynn