Introduction Medicare claims data may be a rich data source for tracking population dementia rates. Insufficient understanding of completeness of diagnosis, and for whom, limits their use. Methods We analyzed agreement in prevalent and incident dementia based on cognitive assessment from the Health and Retirement Study for persons with linked Medicare claims from 2000 to 2008 (N = 10,450 persons). Multinomial logistic regression identified sociodemographic factors associated with disagreement. Results Survey-based cognitive tests and claims-based dementia diagnosis yielded equal prevalence estimates, yet only half were identified by both measures. Race and education were associated with disagreement. Eighty-five percent of respondents with incident dementia measured by cognitive decline received a diagnosis or died within the study period, with lower odds among blacks and Hispanics than among whites. Discussions Claims data are valuable for tracking dementia in the US population and improve over time. Delayed diagnosis may underestimate rates within black and Hispanic populations.

Prevention of chronic disease may generate health and longevity benefits but does not reduce burden of dementia. A focus on treatments that provide even short delays in onset of dementia can have immediate impacts on longevity and quality of life and reduce the number of Americans with dementia over the next decades.

Older Americans have experienced dramatic gains in life expectancy in recent decades, but an emerging literature reveals that these gains are accumulating mostly to those at the top of the income distribution. We explore how growing inequality in life expectancy affects lifetime benefits from Social Security, Medicare, and other programs and how this phenomenon interacts with possible program reforms. We first project that life expectancy at age 50 for males in the two highest income quintiles will rise by 7 to 8 years between the 1930 and 1960 birth cohorts, but that the two lowest income quintiles will experience little to no increase over that time period. This divergence in life expectancy will cause the gap between average lifetime program benefits received by men in the highest and lowest quintiles to widen by $130,000 (in $2009) over this period. Finally we simulate the effect of Social Security reforms such as raising the normal retirement age and changing the benefit formula to see whether they mitigate or enhance the reduced progressivity resulting from the widening gap in life expectancy.

On Medicare’s 50th anniversary, we use the Future Elderly Model (FEM) – a microsimulation model of health and economic outcomes for older Americans – to generate a snapshot of changing Medicare demographics and spending between 2010 and 2030. During this period, the baby boomers, who began turning 65 and aging into Medicare in 2011, will drive Medicare demographic changes, swelling the estimated US population aged 65 or older from 39.7 million to 67.0 million. Among the risks for Medicare sustainability, the size of the elderly population in the future likely will have the highest impact on spending but is easiest to forecast. Population health and the proportion of the future elderly with disabilities are more uncertain, though tools such as the FEM can provide reasonable forecasts to guide policymakers. Finally, medical technology breakthroughs and their effect on longevity are most uncertain and perhaps riskiest. Policymakers will need to keep these risks in mind if Medicare is to be sustained for another 50 years. Policymakers may also want to monitor the equity of Medicare financing amid signs that the program’s progressivity is declining, resulting in higher-income people benefiting relatively more from Medicare than lower-income people.

California for assistance with the Future Elderly Model simulations. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research. At least one co-author has disclosed a financial relationship of potential relevance for this research. Further information is available online at http://www.nber.org/papers/w23329.ack NBER working papers are circulated for discussion and comment purposes. They have not been peer-reviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications.