Alzheimer's Staggering $259B Cost Could Break Medicare

The cost of providing care for Americans with Alzheimer’s disease has hit $259 billion–more than a quarter of a trillion dollars–as costs mount to treat more aging baby boomers entering long-term care facilities, according to a new report.

The annual cost estimate for the deadly disease from the Alzheimer’s Association comes as Congress and the White House once again have healthcare reform and funding for entitlement programs like Medicaid for poor Americans and Medicare for the elderly on their agenda.

“It’s going to bankrupt Medicare if we don’t do something about it,” Alzheimer’s Association senior director of public policy, Matthew Baumgart, said in an interview.

The Alzheimer’s Association puts the report out annually in part to remind policymakers that there is no cure for the disease and that research needs to be funded. 5.5 million Americans are living with Alzheimer’s dementia and most of them are over the age of 65, the association said. Meanwhile, the disease is taking a financial toll on a U.S. healthcare system that provides more Americans healthcare coverage given the lack of treatments to reduce the prevalence and severity of the disease.

“Two-thirds of the costs of Alzheimer’s are borne through taxpayers from Medicare and Medicaid,” Baumgart said. “More and more people are being affected by it as more people move into the system and need long-term care healthcare costs.”

Medicare and Medicaid pay for about two-thirds, or $175 billion, of the “total healthcare and long-term care payments for people with Alzheimer’s and other dementias,” the association said of data in the report, which was created with the help of the Lewin Group.

Medicare, in particular, is hit hard because coverage generally begins for Americans once they reach age 65. Medicare costs for someone with Alzheimer’s and other dementias is $23,487, or triple the $7,223 costs for Medicare beneficiaries without these conditions.

“It complicates the ability to manage other chronic conditions,” Baumgart said of Alzheimer’s.

Employers and insurers are hopeful that moves away from fee-for-service medicine to value-based approaches that work to get people better care upfront will help better coordinate care given people with Alzheimer’s develop other chronic conditions like hypertension, diabetes and heart disease as they age. Someone with Alzheimer’s who has diabetes costs 80% more than someone with just diabetes,  data from the Alzheimer’s Association shows.

"For employers with an aging and older workforce, the impact of Alzheimer's on health and costs is a growing issue,” said Michael Thompson, president and CEO of National Alliance of Healthcare Purchaser Coalitions, which includes myriad employers like Abbvie, Boeing , Dell , Google , Pfizer and UnitedHealth Group among its 12,000 purchaser members. “The good news is that there are positive actions that companies and their workers can take to help mitigate or delay its onset."