HMN 2026: How Dementia could cost US $818 billion in 2026, with unpaid care driving burden

A new USC-led study finds Alzheimer’s disease and related dementias will cost the United States an estimated $818 billion this year, driven largely by often-overlooked costs to persons living with dementia and family and friends providing their care.

In addition to medical and long-term care costs, the research team’s cost model accounts for factors often not captured in other estimates of dementia’s economic toll, such as diminished quality of life, lost earnings for people with dementia and care partners, and extensive unpaid care provided by family and friends. The 2026 estimate comes from a multi-year research project

Here are key findings from the study, published June 24 in Alzheimer’s & Dementia: The Journal of the Alzheimer’s Association:

• Dementia population: 5.7 million Americans are living with dementia in 2026, including 5.1 million who are 65 and older.
• Quality of life impact: Reduced quality of life among people with dementia—marked by declines in cognition, function and independence—represents 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: 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, valued at $237 billion.
• Medical care costs: Long-term and medical care costs for people with dementia total $222 billion. Medicare and Medicaid cover about 70% ($154 billion), while patients and families pay 20% ($46 billion) out of pocket.
• Lost wages: People with dementia and their care partners forgo $23 billion in annual earnings.

Evolving cost model enables more informed decision-making

The 2026 report from the U.S. Cost of Dementia Project builds on last year’s findings as the researchers continue to improve their cost estimates.

This year’s peer-reviewed estimates now account for forgone earnings of people living with dementia and include new models of health-related quality-of-life impacts for care partners. Also new this year is a methods paper to make the data, assumptions and modeling accessible and transparent. The work is also published in the journal Alzheimer’s & Dementia.

The project aims to provide the most comprehensive accounting yet of dementia’s economic impact while strengthening the ability of researchers and policymakers to address it. Tracking changes in dementia costs over time, including shifts in who bears those costs and when, can help inform policy and treatment decisions.

The cost model incorporates large, nationally representative data sets, including the Health and Retirement Study and administrative health data from the Centers for Medicare and Medicaid Services. Researchers use dynamic microsimulation to project how new treatments, care models and policies will affect future dementia costs, including often-hidden impacts on well-being and finances.

“By providing annual, comprehensive and transparent estimates of dementia’s total costs, our research can help guide decisions about how to allocate resources as the dementia population is set to grow substantially,” said lead researcher Julie Zissimopoulos, principal investigator of the U.S. Cost of Dementia Project, co-director of the Aging and Cognition program at the USC Schaeffer Center for Health Policy & Economics and a professor at the USC Price School of Public Policy. “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?”

Science and dementia care are rapidly evolving: New therapies are slowing Alzheimer’s, FDA-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.

“Remarkable innovations can alter the trajectory of dementia in the United States if they are used effectively,” said Dana Goldman, founding director of the USC Schaeffer Institute. “The evidence we are building on dementia costs will provide the health care system with a clearer understanding of these and future innovations.”

The multidisciplinary research team consists of leading experts from the Schaeffer Center and across USC—including the Price School, the Mann School of Pharmacy and Pharmaceutical Sciences, the Davis School of Gerontology and the Viterbi School of Engineering—along with researchers at the Alzheimer’s Association and the University of Pennsylvania. The cost model is informed by public health leaders, health care providers, and the experiences of people with mild cognitive impairment and care partners of people living with dementia, which are shared through panel discussions organized by the Alzheimer’s Association.

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