New Study Shows Alzheimer's Cost to Medicare to Jump by 54%, Jeopardize Healthcare System

Alzheimer's Association
Tuesday, 3 April 2001

A new 50-state study shows a jump of 54 percent by the year 2010 in Medicare costs for people with Alzheimer's, raising dire questions about the survival of the current U.S. healthcare system unless a way is found to prevent or delay the disease.

This increase in cost comes even before an expected epidemic of Alzheimer's hits. Between 2010 and 2050, the number of people with Alzheimer's will increase from an estimated 5.5 million up to 14 million, as the babyboomers enter the age of highest risk.

"This imminent epidemic of Alzheimer's disease threatens to bankrupt Medicare and Medicaid. We must act now and invest in research programs," said Stephen McConnell, vice president of the Alzheimer's Association. "We call on Congress and President Bush to make conquering Alzheimer's disease an immediate top federal health priority."

"Congress must increase Alzheimer research funding at the National Institutes of Health to $1 billion, with a minimum down payment of an additional $200 million this year," said McConnell. The National Institutes of Health is now spending about $515 million on Alzheimer research.

The study prepared by The Lewin Group shows within 10 years, the cost to Medicare of treating people with Alzheimer's disease will soar from $31.9 billion in 2000 to $49.3 billion in 2010.

The report* shows a similar impact on Medicaid, with program expenditures for nursing home care for people with Alzheimer's increasing from $18.2 billion in 2000 to an estimated $33 billion in 2010.

"Scientists now know that the process that destroys brain cells begins in the brain at least 10 years before the symptoms of Alzheimer's appear, " said McConnell. "If we haven't found a way to slow down or stop that process before the babyboomers start turning 65, it may be too late to save most of them from the disease."

According to McConnell the payoff on a $1 billion research investment will be enormous. "By delaying the onset of Alzheimer's for even five years, we can keep half of the babyboomers who are now at risk from ever suffering the devastating effects of the disease. The savings to Medicare and Medicaid will be dramatic. Even a one-month delay in nursing home placement is estimated to save $1 billion a year."

The study shows expenditures for persons with Alzheimer's make up approximately 14.4 percent of total Medicare spending, even though such persons represent only about 10 percent of all Medicare beneficiaries. The share of Medicare spending devoted to beneficiaries with Alzheimer's rises to 15.7 percent in 2010, when total Medicare spending is estimated to be $314 billion.

Most people who get Alzheimer's and related dementias are Medicare beneficiaries. Even though Medicare does not pay for what they need most -- long term care and prescription drugs, it spends a lot on their basic health care. Alzheimer-related health care costs are not limited to those with the disease. Caregivers—one-third of whom are Medicare beneficiaries themselves—have more health problems than others their age.

Medicaid expenditures for people with Alzheimer's disease are high because of the uninsured cost of long term care. Nearly half of Medicare beneficiaries with Alzheimer's disease also qualify for Medicaid, because they have exhausted their own resources paying for long term care. At least half of all nursing home residents have dementia. They are the residents with the longest stays and the ones most likely to spend down to Medicaid.

The Alzheimer's Association is the premier source of information and support for the 4 million Americans with Alzheimer's disease. Through its national network of chapters, it offers a broad range of programs and services for people with the disease, their families, and caregivers and represents their interests on Alzheimer-related issues before federal, state, and local government and with health and long-term care providers.

The largest private funder of Alzheimer research, the Association has committed more than $100 million toward research into the causes, treatment, prevention, and cure of Alzheimer's. You can reach the Alzheimer's Association at (800) 272-3900.

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