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Alzheimer’s disease and related dementias will cost the U.S. about $818 billion this year, driven by medical expenses, as well as the often overlooked costs such as diminished quality of life, lost earnings for patients and their caregivers, and the value of unpaid care provided by family and friends.
That cost compares with $781 billion a year ago, a number that reflected slightly different methodology on some metrics. Tracking changes in dementia costs over time, including shifts in who bears those costs and when, can help inform resource allocation and treatment decisions, researchers said in the new study in “Alzheimer’s & Dementia: The Journal of the Alzheimer’s Association.”
“The big headline number helps society think about where we should be spending our scare resources. This is a bigger number than cancer and heart disease combined,” the study’s lead researcher Julie Zissimopoulos, who is also a professor at the the University of Southern California Price School of Public Policy, told MarketWatch. “This is the most expensive disease in a population that is aging — and rates of dementia rise with age.”
There are currently 5.7 million people in the U.S. living with dementia. There is no cure for the disease, which is fatal.
The study comes as the U.S. Census Bureau projects a more than doubling of the U.S. population that‘s 85 and older by 2050. Age is a strong predictor for dementia. The lifetime risk of dementia after age 55 is about 42%, according to a 2025 study published in the journal Nature Medicine.
Read: The risk of dementia is much higher than experts thought
“With our modeling approach, we can ask and answer questions such as, ‘How will a new treatment that slows dementia improve quality of life or affect demand for nursing-home care?’ ” Zissimopoulos said.
Tracking the costs of dementia over time will be important as pharmaceutical treatments change the disease trajectory and new diagnostic tools alter what we know about who has what type of dementia and when the illness emerges, according to the study.
The economic toll of dementia is massive and the vast majority of the overall burden falls on families, Zissimopoulos said.
“I think people should be alarmed. This is a health crisis. It’s also an economic crisis for families and government. It’s not something to sit back and ignore,” Zissimopoulos said.
Within the total costs, researchers found that the quality-of-life impact was greatest amid declines in cognition, function and independence. That represented the largest cost at $320 billion. Informal care partners experience an additional $15 billion in quality-of-life losses related to emotional and physical strain.
Unpaid caregiving added about $237 million. About 5.2 million people, often in their prime working years, provide 6.8 billion hours of unpaid care to a family member or friend with dementia.
Read: As baby boomers turn 80, caregiving is the unexpected job more Americans face
Long-term care and medical costs for people with dementia totaled $222 billion. Medicare and Medicaid cover about 70%, or $154 billion, while patients and families pay 20%, or $46 billion, out of pocket.
Lost wages for people with dementia and their caregivers total $23 billion annually.
The total costs “quantified the real-world resource burden on families, health systems, and society. It captured how dementia shapes medical care, long-term care, and family caregiving in ways that cannot be easily disentangled from co-occurring conditions,” the study said.
Science and care are rapidly evolving: New therapies are slowing Alzheimer’s, while Food and Drug Administration–approved blood tests can detect Alzheimer’s before symptoms appear, and new care models are helping people with dementia stay at home longer while supporting families.
Medicare does not pay for long-term care such as nursing-home stays and assisted living. The cost of a private room in a nursing home exceeds $129,000 a year, according to CareScout.
“There is no universal long-term-care financing. This is a space that is super costly — and there’s no answer for the families, the spouses, sons and daughters who are providing care,” Zissimopoulos said. “The impact on families is enormous.”
