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Objectives The aim of this study was to develop a validated model to predict current and future Australian costs for people with dementia to help guide decision makers allocate scarce resources in the presence of capacity constraints. Methods A hybrid discrete event simulation was developed to predict costs borne in Australia for people with dementia from 2015 to 2050. The costs captured included community-based care, permanent and respite residential aged care, hospitalisation, transitional care, pharmaceuticals, aged care assessments, out of hospital medical services and other programs. Results The costs borne for people with dementia in Australia are predicted to increase from A$11.8 billion in 2015 to A$33.6 billion in 2050 at 2013-14 prices, ceteris paribus. If real per capita health and social expenditure increased by 1.0% annually, these costs are predicted to increase by around A$14.2 billion to a total of around A$47.8 billion by 2050. Conclusions This simulation provides useful estimates of the potential future costs that will be borne for people with dementia and allows the exploration of the effects of capacity constraints on these costs. The model demonstrates that the level of real annual per capita growth in health and social expenditure has significant implications for the future sustainability of dementia care in Australia. What is known about the topic? With the aging of the Australian population, the number of people living with dementia is predicted to rise markedly in the next four decades. As the number of people living with dementia increases, so too will the financial burden these debilitating and degenerative diseases place on private and public resources. These increases are likely to challenge the efficiency and sustainability of many health systems in the developed world. What does this paper add? This research provides a validated model to predict current and future Australian costs for people with dementia to help guide decision makers allocate scarce resources in the presence of capacity constraints (i.e. where the supply of resources does not meet demand). The model predicts an increase in costs for people with dementia from A$11.8 billion in 2015 to A$33.6 billion in 2050 at 2013-14 prices. If real per capita health and social expenditure increased by 1.0% annually, these costs are predicted to increase by around A$14.2 billion to a total of around A$47.8 billion by 2050. What are the implications for practitioners? This simulation provides useful estimates of the potential future costs that will be borne for people with dementia and allows the exploration of the effects of capacity constraints on these costs. The model demonstrates that the level of real annual per capita growth in health and social expenditure has significant implications for the future sustainability of dementia care in Australia.

Simulation of health care and related costs in people with dementia in Australia