Monetary Costs of Dementia in the United States
Apr 1, 2013
Dementia costs Americans hundreds of billions of dollars per year, and the annual cost could top half a trillion dollars by 2040 due to the "graying" of the U.S. population. The "market costs" of dementia already exceed those for cancer and heart disease, while the "informal costs" of home care for those with dementia can raise the total expense nearly 50 to 100 percent, depending on the calculation method. The National Alzheimer's Project Act, signed into law in 2011, calls for these kinds of cost calculations, along with new treatments and improved care for people with dementia. In addition, says research leader Michael Hurd, director of the RAND Center for the Study of Aging, "This calls for an insurance-style solution, one in which the costs of long-term care could be spread across the entire population rather than being concentrated on the unlucky few."
|Out of pocket||$23,688,502,158|
|Formal home care||$21,715,097,716|
|Nursing home care||$53,067,752,009|
Millions of Americans provide unpaid, informal care for a family member with dementia, and many nonrelatives provide care as well. This informal caregiving represents a cost to society in the form of lost productivity and income. Researchers took two approaches to estimating the value of informal care: forgone wages (what caregivers would have earned if they had spent their time working in the labor market rather than caring for someone with dementia) and replacement cost (the cost of the equivalent service when provided through a home health agency).
|Forgone wages||50 billion dollars|
|Replacement cost||106 billion dollars|
3 in 20 Americans 71 or older have dementia
Cases of dementia may more than double by 2040
That’s an increase of about 5 million Americans with dementia
Dementia's total annual economic cost will grow accordingly
|2010||215 billion dollars|
|2020||255 billion dollars|
|2030||361 billion dollars|
|2040||511 billion dollars|
That's an increase of 138%
SOURCE: "The Monetary Costs of Dementia in the United States," New England Journal of Medicine, Vol. 368, No. 14, April 4, 2013, pp. 1326–1334, Michael D. Hurd, Paco Martorell, Adeline Delavande, Kathleen J. Mullen, Kenneth M. Langa.
NOTE: All totals in 2010 U.S. dollars.
Infographic by Erin-Elizabeth Johnson and Dori Gordon Walker. Photo illustrations adapted from iStockphoto/Thinkstock.
This report is part of the RAND Corporation Infographic series. RAND infographics are design-focused, visual representations of data and information based on a published, peer-reviewed product or a body of published work.
This document and trademark(s) contained herein are protected by law. This representation of RAND intellectual property is provided for noncommercial use only. Unauthorized posting of this publication online is prohibited; linking directly to this product page is encouraged. Permission is required from RAND to reproduce, or reuse in another form, any of its research documents for commercial purposes. For information on reprint and reuse permissions, please visit www.rand.org/pubs/permissions.
The RAND Corporation is a nonprofit institution that helps improve policy and decisionmaking through research and analysis. RAND's publications do not necessarily reflect the opinions of its research clients and sponsors.