US Dementia Costs Forecast to Surpass $780 Billion in 2025

The economic burden of dementia in the United States is projected to reach an astonishing $781 billion this year, according to recent research led by the USC Schaeffer Center. This comprehensive estimate accounts not only for direct medical and long-term care expenses but also for the broader societal costs associated with dementia, including lost quality of life and productivity.

The study highlights that approximately 5.6 million Americans are living with dementia in 2025, with the majority being over age 65. Care costs for these individuals total $232 billion, with families paying out-of-pocket $52 billion. Notably, Medicare and Medicaid are responsible for covering over two-thirds of these expenses.

Beyond direct healthcare costs, the research emphasizes the substantial societal impact—valued at over $314 billion—stemming from diminished quality of life for patients ($302 billion), reduced well-being of care partners ($6 billion), and lost earnings from those who reduce work hours or leave employment to provide care, amounting to $8.2 billion. Unpaid care hours, provided by care partners, are valued at approximately $233 billion.

The researchers utilize dynamic microsimulation models, drawing data from nationally representative surveys and health records, to project how advancements in treatments and policy changes could influence future costs. Current estimates suggest that caring for dementia patients involves significant government expenditure, primarily through Medicare and Medicaid, and immense unpaid contributions from families and communities.

As innovation in diagnosis and treatment continues—such as blood tests for early detection and therapies that slow cognitive decline—the study aims to inform policymakers and stakeholders to optimize resource allocation and develop strategies to mitigate this growing financial and societal challenge.

This ongoing research underscores the urgent need for effective prevention, early detection, and treatment options to alleviate the escalating costs of dementia, which continues to be a pressing issue for healthcare systems and society at large.

Source: https://medicalxpress.com/news/2025-04-dementia-exceed-billion-year.html