Background: The number of patients with Alzheimer’s disease (AD) and related dementia treated in managed care organizations (MCOs) is increasing, and this trend is expected to continue. Therefore, it is critical that MCOs develop disease management strategies for this population. Objective: To review the literature on the prevalence, costs, and treatment of AD and related dementia. Study Design: Review of published articles from MEDLINE and peer-reviewed journals.

Results: Prevalence of AD and related dementia is approximately 5.7% among those aged 65 and older. Prevalence data from claims-based studies of AD in managed care are lower, ranging from 0.55% to 0.83%. Costs for formal care average $27,672 per patient annually, with long-term care being the most costly component. Annual costs for informal care are estimated to be $10,400 to $34,517 per patient. Additional costs associated with AD include lost wages and productivity of patients and caregivers and costs associated with increased morbidity of caregivers. Donepezil treatment is well tolerated and has been extensively tested and evaluated in clinical settings. Early diagnosis and treatment of AD with donepezil has been shown to slow cognitive decline in AD. Although study findings regarding the cost offsets of donepezil-treated patients to date are mixed, there is a growing body of evidence to support the inclusion of this and other therapies into an MCO’s AD treatment armamentarium. Conclusions: It is unlikely that MCOs will escape the increased prevalence and costs associated with AD. Opportunities exist through patient management programs targeted toward early diagnosis, effective use of medications, control of comorbidities, and patient and family support to partially offset these costs while providing quality patient care.