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This study examines total formal and informal care costs attributable to Alzheimer's disease for persons living in the community and in institutions. The total cost of caring for an Alzheimer's patient in northern California is approximately $47,000 per year whether the patient lives at home or in a nursing home, but the cost breakdown differs in the two settings. For community-resident patients, three-fourths of the total cost represents an imputed value for unpaid informal care compared with 12 percent for institutionalized patients. Formal services are financed primarily by individuals and their families. Over 60 percent of the services provided to patients in either care setting were paid out of pocket. With projected increases in the number of persons at risk of developing Alzheimer's disease, the economic impact of the disease on future long-term care costs will be significant.