Alzheimer's Triples Cost of Health Care

By Mary Pickett, M.D.
Content provided by the Faculty of the Harvard Medical School

Having Alzheimer's disease triples a person's health care costs, a new report says. The report tallied costs for nursing homes and other medical care. Medicaid, Medicare and private insurance paid for the care. The total was about $33,000 a year for someone with Alzheimer's. Costs were about $10,600 a year for an older adult without the disease. The Alzheimer's Association issued the report. The Associated Press wrote about it March 24.

What Is the Doctor's Reaction?

This week the Alzheimer's Association has shared startling numbers. The new report adds up the health care costs of Alzheimer's patients. It says that each patient's costs average more than $33,000 per year. This compares with $10,600 per year for an older adult who does not have Alzheimer's.

These costs do not factor in the extra work for family members who care for a person with Alzheimer's. Nor do they include the value of the caregivers' lost work hours.

As our older population gets even older, Alzheimer's is rising. So these cost figures are daunting. But the numbers compare people with Alzeimer's to the population at large — people who are mostly well.

To be fair, let's compare Alzheimer's costs to spending for other health crisis events among the elderly. We can look at Medicare spending on hospital stays, doctor visits, drugs and nursing homes all combined. My numbers come from several recent articles that estimated health care costs based on Medicare claims data:

  • Alzheimer's — average spending of $33,000 per year

  • Heart attack — average spending more than $30,000 in the first year

  • Hip fracture — average spending about $21,000 in the first year

These numbers can help to put Alzheimer's spending into perspective. Of course, Alzheimer's disease is a continuing illness. It's not a single event.

But how many years do these Alzheimer's costs continue? Most people with Alzheimer's disease die within five years. This is not good news for Alzheimer's patients, but important to consider as we struggle to predict health care costs.

The most important study on Alzheimer's survival rates was published in 2004. This study kept track of more than 500 people with Alzheimer's disease over time. It found that survival after a diagnosis of Alzheimer's was roughly half as long as expected for people in the same age group. Only one-half of the women were still living 5.7 years after diagnosis. One-half of the men were living 4.2 years after diagnosis.

It is not perfectly clear why Alzheimer's patients survive less well. Several researchers have explored the causes of death in Alzheimer's disease.

A little more than one-third of Alzheimer's patients die of heart and artery disease, such as heart attack or stroke. About one-fourth die of bronchitis or pneumonia, as did former President Ronald Reagan. Many researchers have noted that people with Alzheimer's disease who are hospitalized with short-term illnesses don't survive these illnesses as well as others.

What Changes Can I Make Now?

End-of-life care is costly, whether the condition is short-term or long-term. The course of Alzheimer's disease includes not only large health care costs, but also many important health care decisions.

If you have been diagnosed with Alzheimer's, it's a good idea to discuss your finances with your family. Also, talk with them about the kind of decisions that often must be made near the end of life. These discussions can be updated over time. It's particularly important to choose a person who can make decisions for you, if necessary. You can legally appoint this person as your "durable power of attorney."

What Can I Expect Looking to the Future?

About 1 out of 100 people between ages 60 and 64 have a diagnosis of Alzheimer's disease. But after age 85, as many as 40 out of 100 people have this illness. Our population is aging. This means we expect the numbers of people with Alzheimer's to climb steeply during the next few decades. Researchers are looking for an effective way to prevent or treat Alzheimer's. If they succeed, it would have a large impact on health care costs.

Last Annual Review Date: 2009-03-26T00:00:00-06:00

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More than 5.3 million people in the United States are living with Alzheimer's disease, with a new person developing the disease every 70 seconds. Americans ages 65 and older with Alzheimer's and dementia pay three times as much in health care costs.