U.S. Health Care System Benefits from $196 Billion in Services From Family Caregivers

Alzheimer's Association
Tuesday, 23 March 1999

But Families Pay a Staggering Price to Provide That Care: Stress, Exhaustion Not Included in Tabulation of Costs

A stunning $196 billion a year is contributed to the U.S. health care system by an "invisible" health care sector — the family and friends who provide care at home for the chronically ill, according to a new study released by the Alzheimer's Association.

"The extraordinary level and pervasiveness of caregiving represents a massive subsidy to the American chronic health care system and to the social welfare of the nation," the authors say. They note that because informal caregiving "lies outside the market economy — socially and politically invisible — its economic value is not generally acknowledged."

In four states, caregivers are providing services worth more than $10 billion to long term care in their states. The totals are $22.9 billion in California, $13.6 billion in Texas, $13.5 billion in New York and $11.2 billion in Florida. Nationally, the $196 billion total dwarfs the cost of formal home health care ($32 billion) and nursing home care ($83 billion).

The new study is the first-ever tabulation of caregivers' contribution on a state-by-state basis. Titled "Economic Value of Informal Caregiving in the United States, by States," the study is an analysis of state data from a national study published in the March-April 1999 issue of Health Affairs Magazine.

"We are presenting this data to Congress today, and will present it to governors and state legislatures to underscore the importance of acting immediately to provide family caregivers the support they need," said Stephen McConnell, vice president of public policy for the Alzheimer's Association. The Association is calling on lawmakers to:

- Provide a $1,000 federal tax credit for family caregivers.

- Authorize and appropriate $125 million a year to help states and communities expand respite and adult day care and other caregiver support services.

- Provide for the chronic health care needs of Medicare beneficiaries through prescription drug coverage and an adequate home care benefit.

McConnell said such action would not only help families but also reduce costs for Medicare and Medicaid. "We know that timely services like respite and adult day care can extend the ability of families to provide care — sometimes delaying nursing home admissions by almost a year. Even a one-month delay in nursing home placement can save $1,863 per person — and that adds up to savings of more than $1 billion a year in the costs of Alzheimer care."

"There is no way we can assure the future of Medicare or control the costs of Medicaid if we were to let the family caregiving system collapse," said McConnell.

Maureen Reagan, a board member of the Alzheimer's Association, said "every caregiver needs information and support. Many caregivers also need help in paying the bills that no insurance will cover — the day in, day out expenses that pile up as the disease progresses. Caregiving is an exhausting job — emotionally, physically, and financially. It is not a job that anyone — however strong and resourceful — can do by themselves."

The authors of the study note they did not attempt to add "the well-documented toll on many caregivers' physical and mental health" even though "stress and exhaustion may lead to increased health care being devoted to the caregiver as well as the patient." It is well known that Alzheimer caregivers suffer higher levels of physical strain and emotional stress.

Other research shows that one in eight caregivers becomes ill or injured as a direct result of caregiving and that older caregivers are three times more likely to become clinically depressed than others in their age group. Huge pressures are placed on their other family and work responsibilities. It is not just the amount of time they spend but the type of care they provide that makes their caregiving so intense. Alzheimer caregivers are:

- Twice as likely as other caregivers to be providing more than 40 hours of care each week. Nearly three-fourths have been providing care for at least a year and almost 40 percent have been doing it for more than five years. They provide more help with activities of daily living and are more likely to be dealing with incontinence and with medication problems.

- Three-fourths of Alzheimer caregivers are women, and one in three has children or grandchildren under the age of 18 living at home.

- Seven in 10 are employed for at least some of the time they are caregivers. They miss time from work, cut back to part-time, turn down promotions, transfer to a less demanding job, choose early retirement or quit work altogether.

Employers also have a stake in a reliable structure that relieves the burden of caregivers. A September 1998 study commissioned by the Alzheimer's Association revealed that caregiver absenteeism and lost productivity related to their absence costs employers $33 billion a year.

The study released today was based on data that show 22 percent of the caregivers care for someone with Alzheimer's disease (or "mental confusion") and those caregivers put in much longer time and more intense levels of care. McConnell said one-third of the $196 billion can probably be attributed to Alzheimer caregivers.

The study was conducted by Peter S. Arno, Ph.D., and Margaret Memmott of the Montefiore Medical Center/Albert Einstein College of Medicine and Carol Levine of the United Hospital Fund. It is based on data for 1997, the most recent available. The methodology used in the study was developed by Arno for the Families and Health Care Project of the United Hospital Fund.

For more information, or to contact Alzheimer's Association, see their website at: www.alz.org