Effects of Informal Care for Persons with Alzheimer's Disease and Related Dementias

The current debate about how best to meet the growing demand for patient-centered, high-quality long-term care for persons with ADRD in the least restrictive setting possible has centered almost solely on the direct and indirect costs of each type of care. A crucial missing piece is a comparison of the benefits. While receiving informal care may seem intuitively appealing, we currently know surprisingly little about the implications of this choice for outcomes of the individuals receiving the care.

Our study will be the first to measure the causal impact of receiving informal versus formal long-term care on key and multi-faceted outcomes for the care recipient, primarily using the Health and Retirement Study, a nationally-representative dataset of Americans age 50+. Our analysis would include all individuals receiving long-term care, as well as a sub-sample of individuals living with ADRD, since informal care costs account for approximately half the total costs of the disease. Our health outcomes include a rich set of self-reported physical, mental, emotional, and social health measures, as well as self-reported and administrative health care utilization measures. In order to estimate the causal impact of formal and informal care, we employ instrumental variable techniques and a set of instruments that have been successfully used to predict informal care receipt in previous work using the same dataset. In addition, we propose new and promising instruments, including the supply of formal care available in the market. Finally, our study is the first to take a comprehensive look at all forms of formal care, including the plethora of private-pay residential care options. To do so, this research brings together the Area Health Resource Files (AHRF) and the NIC-MAP database, the industry’s premiere dataset concerning the long-term care market.

Using this approach, our study proposes to address the following specific aims: to describe comprehensively an expanded profile of the supply of publicly and privately financed formal care in local markets and its correlation with informal care, and to quantify the difference in care recipient outcomes caused by receiving informal versus formal care. This proposal will inform the policy tradeoffs between supporting informal care providers and expanding publicly financed formal care options.

Findings/Policy Implications

Insurance coverage tends to encourage institutionalization for long-term care and when looking at foregone earnings this appears to reduce costs at a societal level. However, it is important to think about the cost of the well-being of the caretaker, this may change the calculation. 


Findings show that payment-induced family care decreases inpatient expenditures substantially. These results are achieved through lower emergency room and inpatient usage.