Association of dementia diagnosis, cognitive impairment levels, and their combination with care costs among publicly funded long-term care recipients

Background and objectives: Most people with dementia are undiagnosed and rely heavily on long-term care. Little is known about the relationship between dementia diagnosis and care costs, and inconsistent evidence exists on the cost implications of cognitive impairment severity. We examined how formal and informal care costs are associated with a dementia diagnosis and cognitive impairment levels across care settings. Research design and methods: We used representative data from publicly funded long-term care recipients in residential care settings and community care settings in Hong Kong (n = 1,603). Staff time measurement was used to capture service utilization of both formal and informal care. Generalized linear model (log-link and gamma distribution) was used to estimate long-term care costs, controlling for covariates. Results: A dementia diagnosis is associated with an additional 13% and 23% care costs in residential and community care settings, respectively. People with more severe cognitive impairment incur greater long-term care costs; the highest difference (a 189% increase) was found in informal care costs in community care settings among those with moderate-to-severe cognitive impairment. In community care settings, formal care costs were insensitive to cognition status but were consistently higher with a dementia diagnosis; in contrast, informal care costs were less associated with a diagnosis but increased with cognitive impairment severity. Discussion and Implications: Having a diagnosis of dementia and poorer cognition are associated with higher long-term care costs in both residential and community care settings. A dementia diagnosis is potentially a more important driver of formal care costs than cognitive impairment levels within the current care system, in contrast to what is observed with informal care costs. Practitioners and policymakers need to ensure that individuals with cognitive impairment without a dementia diagnosis receive the appropriate level of care.