Where others see a parent suffering from dementia, economists see foregone wages and expensive treatment. Both are important.
…1 person in 7 in the United States over the age of 70 has dementia… The calculations in this study show that only for those in the 71-74 age bracket, just 2.8% have dementia, but that percentage steadily rises to 4.9% for those in the 75-79 age bracket, 13.0% for those in the 80-84 age bracket, 20.3% for those in the 85-89 age bracket, and a frankly terrifying 38.5% for those over age 90.
The average cost per patient per year is something in the neighborhood of $50,000. And yes, that figure excludes the cost of coexistent health problems in dementia patients, though it does also include the cost of foregone wages. The average cost for dementia treatment alone is closer to $30,000 — that is, if it were it not for dementia, the patients and the people who care for them would probably produce something like $20,000 worth of goods and services, on average per year.
I’ve rounded these figures a little just to make them intuitive (call them stylized facts), and they do have a high variance, but they are basically accurate and are expected to rise. You can see the study Tim is writing about (pdf) for a much more detailed breakdown of the figures and how they were produced.
It’s worth noting that the BRAIN Initiative, the President’s new research program intended in part to ”uncover new ways to treat, prevent, and cure brain disorders,” will cost (for now) the equivalent of treating 3,300 dementia patients for one year, or 2,000 dementia patients after adjusting for foregone wages. Also note that the total number of dementia patients currently stands at four million people and is climbing, and that the total cost per year might be as high as $200 billion (and seems to be at least $150 billion).
That is, the BRAIN Initiative currently costs less than 1% of the cost of treating dementia.
If the program is even marginally successful in preventing dementia it will have been a smart investment. Not only will it have reduced the human cost of dementia — which probably can’t be measured, and certainly isn’t measured by this study — it will have paid for itself by freeing up labor and saving entitlement programs upteen dollars. It is also basic research, so it is probably being under-supplied by private actors.
So the BRAIN Initiative seems like a smart idea, though I suppose whether that happens remains to be seen.