The need for long-term care (LTC) is prevalent and growing, especially among individuals with Alzheimer’s Disease and Related Dementias (ADRD). Assistance to older adults with disabilities, including ADRD, may be from paid or unpaid sources or provided in the home or a residential setting. Evidence on the effectiveness of different LTC types has centered almost solely on the costs. Recent estimates suggest that informal care represents up to one-half of the overall costs of ADRD. Increasing longevity, strained budgets, and increasing prevalence of ADRD have led policymakers to advocate for increased reliance on informal care from family and friends as a potential substitute for formal care. There is increasing evidence that unpaid informal care is not costless; caregivers experience worse health, reduced earnings and fewer labor market opportunities.

Our study aims to understand the benefits and drawbacks to informal versus formal care. This study will be the first to measure the causal impact of receiving informal versus formal long-term care on person-centered outcomes for individuals with ADRD, using the Health and Retirement Study (HRS), a nationally representative dataset of Americans aged 50+.

Our study has three main aims:

Aim 1: Provide an expanded profile of the supply of publicly and privately financed formal care markets in order to look at all the potential avenues of care substitution between informal care and formal care.

Aim 2: Estimate the effect of informal versus formal care on health outcomes for persons with ADRD.

Aim 3: Estimate the effect of informal versus formal care on health care use and costs for persons with ADRD.