As Tax Season Approaches, Consider the Potential Costs of Alzheimer’s
As Tax Day draws near and people are looking closely at their finances, the Alzheimer’s Association encourages families to proactively plan for the potential financial impact of the most expensive disease: Alzheimer’s and dementia.
The numbers are staggering for the No. 6 cause of death in the United States and the only major disease without a prevention, treatment or cure: nearly 6 million Americans are living with Alzheimer’s or another form of dementia, including 71,000 Coloradans. Globally, the total is 47 million, and someone new develops Alzheimer’s every 3 seconds.
Total annual payments for U.S. families caring for those with Alzheimer’s and other dementias have surpassed a quarter of a trillion dollars ($277 billion). For individual families, average out-of-pocket costs for health care and long-term care services not covered by Medicare, Medicaid and private insurance routinely exceed $10,000 annually.
“The financial toll of Alzheimer’s and other forms of dementia is crippling,” said Amelia Schafer, executive director of the Colorado Chapter of the Alzheimer’s Association. “Sadly, very few families are prepared for the cost of care, or realize how little of that cost is covered by insurance.”
A 2016 Alzheimer’s Association report found that nearly two out of three people incorrectly believe that Medicare helps pay for nursing home care, or were unsure whether it does.
Preparing for retirement – and Alzheimer’s
The challenge for families – particularly those where there may be a family history of Alzheimer’s that suggests a higher potential risk – is that the vast majority of people are already unprepared for the cost of a healthy retirement. For those affected by dementia, the impact could be devastating.
“During tax season, we take stock of our financial resources,” said Schafer. “This is the ideal time to look at retirement planning and anticipate the possibility of long-term medical care. It is important to have financial and legal plans in place to address your wishes for future care.”
The Alzheimer’s Association encourages people to conduct an inventory of their financial resources, including savings, insurance, retirement benefits, government assistance and VA benefits, and to consult with a financial planner or elder care attorney to review options.
Tax benefits for caregivers
Beyond anticipating future medical expenses, it is important for those who are serving as unpaid caregivers for loved ones to understand that they may be eligible for tax benefits from the Internal Revenue Service (IRS) if they have paid some care costs out of their own pockets. Tax rules are complex and can change, so individuals are advised to consult with a tax adviser or accountant.
To learn more about financial and legal planning for Alzheimer’s caregivers, click here or call the Alzheimer’s Association free 24/7 Helpline at 800-272-3900.
The urgent case for finding an Alzheimer’s cure
The financial impact of Alzheimer’s disease and other dementias already is staggering for the U.S. collectively, and the cost is only expected to grow. Today, $1 of every $5 in Medicaid funds goes to provide care for persons living with dementia. Since Alzheimer’s is the only major disease without a prevention, treatment or cure, and our country’s population is aging, those numbers will only get worse. If no cure is found by 2050, it is estimated that $1 of every $3 in Medicaid funds will go toward dementia care.
“As the number of people living with dementia rises, the burden on our public health systems will be unsustainable,” said Schafer. “This only underscores the need for families to plan ahead. As time passes and until a cure is found, we can expect that we will need to assume an increasing share of the cost of care for our loved ones living with Alzheimer’s disease. Planning for that is essential.”
The Alzheimer’s Association Colorado Chapter is the premier source of information and support for the more than 71,000 Coloradans with Alzheimer’s disease, their families and caregivers. Through its statewide network of offices, the Alzheimer’s Association offers education, counseling, support groups and a 24-hour Helpline at no charge to families. In addition, contributions help fund advancements in research to prevent, treat and eventually conquer this disease. The Alzheimer’s Association advocates for those living with Alzheimer’s and their families on related legislative issues, and with health and long-term care providers. For information call the Alzheimer’s Association 24/7 bilingual Helpline at 800-272-3900, or visit www.alz.org/co.