In a recent study, health economist Lauren Nicholas, PhD, found older adults who go on to be diagnosed with dementia are more likely to miss payments on bills as early as six years before a diagnosis. Dr. Nicholas joins the podcast to discuss her research findings, how financial symptoms could be used as early predictors of dementia, signs that may indicate financial trouble due to dementia, and resources for managing your own or a loved one’s finances early. Guest: Lauren Nicholas, PhD, associate professor, Johns Hopkins Bloomberg School of Public Health
- How was the study designed? 1:00
- Who did you look at for in the study? 5:09
- What are your findings? 6:12
- Do you think the financial impact is different based on the amount of family members? 9:24
- What types of resources are available? 11:01
- What do you hope this research will lead to? 13:32
- What are clues to watch for financial trouble due to cognitive decline? 15:47
- How do you see financial information being useful for understanding dementia in the future? 17:33
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Learn more about Lauren Hersch Nicholas, PhD, in her academic biography.
Read "Dementia may cause major financial problems long before diagnosis, making early detection critical" from The Washington Post, November 30, 2020.
Read "Financial problems can be sign of dementia onset" from the National Institutes of Health, December 15, 2020.
Intro: I'm Dr. Nathaniel Chin, and you're listening to Dementia Matters, a podcast about Alzheimer's Disease. Dementia Matters is a production of the Wisconsin Alzheimer's Disease Research Center. Our goal is to educate listeners on the latest news in Alzheimer's Disease research and caregiver strategies. Thanks for joining us.
Dr. Nathaniel Chin: My guest today is Dr. Lauren Nicholas, associate professor in health policy and management at the Johns Hopkins Bloomberg School of Public Health. Dr. Nicholas is a health economist whose research focuses on the role of public policy in improving health and healthcare quality for the elderly. In recently published research, Dr. Nicholas and co-authors found that financial problems are occurring up to six years before dementia diagnosis. Dr. Nicholas, thanks for joining Dementia Matters to talk about this important topic.
Dr. Lauren Nicholas: Thanks so much for having me. I'm really happy to be here.
Chin: Now your research has put some data behind something that healthcare professionals and others who work with people with dementia have long understood, that financial problems can be one of the earliest signs of Alzheimer's disease. Your work was very interesting, using Medicare data and federal consumer credit reports. Tell us a little bit about this study design and why you use this approach.
Nicholas: Sure. This study was initially inspired by a meeting at the American Geriatric Society, where some of the clinicians in attendance were talking about some of these problems that they were observing in their patients with early-stage dementia and kind of the challenges of involving other family members in the financial decisions and relinquishing control. Most of what was known at the time was coming from these clinical anecdotes. It seemed like it would be great if we could put some economic data behind this idea and look at the extent to which this was impacting people and better understand the sort of prevalence and magnitude of these problems. Consumer credit report data is one of our biggest sources of data on American financial outcomes. The vast majority of Americans use at least one credit product, often a credit card, that gives us sort of regularly occurring information about both are they spending and repaying the amounts that have been lent to them. These data are increasingly being used for research in a number of economic applications, so linking them to Medicare claims was not an easy process but there aren't really any large-scale datasets that include the financial predictors and consequences of dementia that we were interested in studying, as well as a dementia diagnosis itself. So we had to find a way to get these two very disparate but sort of linked areas to unite in one data set.
Chin: And so this is a first of its kind study then where you're linking consumer credit reports with Medicare data, in particular for a population of people who are experiencing cognitive impairment.
Nicholas: Yes, so there have been some other studies that have linked these credit data to other health and healthcare utilization outcomes, but we're the first to do it in the dementia population. What we show in our paper is one of the unique things about dementia is that these symptoms present so much earlier than the financial diagnosis, and so we know that you know having a catastrophic health event, like getting cancer or a hospitalization, can make it difficult for you to pay bills, either because you have all these new costs associated with your healthcare or because you're in the hospital and taken away from your daily activities, but with dementia we have this additional challenge that early symptoms can involve becoming forgetful or taking on new risks you wouldn't have done before that have these potentially profound impacts on financial behavior. In our work, we see that people are at elevated risk of missing a payment up to six years before they receive a diagnosis for dementia in the Medicare data and that these problems also persist after diagnosis. We were sort of hoping that once you receive a diagnosis that triggers family and friends getting involved in helping you manage your finances, but we actually saw that a number of Medicare beneficiaries continue to have these missed payments after diagnosis.
Chin: And so who exactly did you look at when you were designing and then and doing your study?
Nicholas: We focused on Medicare beneficiaries who lived in single-person households, since that gives us the clearest connection between the same subjects, financial events, and diagnostic history. We compared a sample of beneficiaries who went on to develop Alzheimer's disease and related dementia at some point during our study period, which spanned from 1999 through 2018 and we compared them to beneficiaries who were sort of similar on demographic, geographic, and health variables but did not develop dimensions. So this allowed us to kind of differentiate between missed payments that were directly tied to dementia and other consequences of aging and developing new illnesses more generally.
Chin: You already touched on a huge finding, which is that you could identify some of these financial problems up to six months before a diagnosis and even a couple of years after a diagnosis. For our listeners that haven't read your paper yet, what are some of the other findings from your study or the consequences people with dementia and their families face when these financial troubles continue without really having that knowledge of a diagnosis? What’s really happening to these individuals and families?
Nicholas: Right, so we found few really key results that sort of worry us and we hope will motivate families to get more involved and older adults to do sort of advance financial planning. First of all, missed payments as well as developing a subprime credit score, which is a composite measure of how likely you are to repay a loan in the future if you are extended new credit, views effects, first of all, were large enough to even show up in a nationally representative data set. They represent up to 15% of the missed payments among dementia patients in our sample at their most prevalent. We also saw that there was a longer period of symptoms prior to diagnosis for those who lived in areas with lower average education, suggesting that there's some barriers to screening and diagnosis for those who are having these adverse financial events for a longer period of time. Then we were only looking at things that show up on your credit report, which means that we didn't see things like a bank account where we might worry about people making unnecessary payments or losing money to fraud and other scams. We don't see what happens if you decide to cash out your retirement account or move all your investments into a single risky stock, so the consequences of missed payments that we see in the credit data include getting fined every time you miss a payment, which can lead to nontrivial financial losses just as the consequence of these missed payments. It becomes harder to borrow in the future if you need the money. You can lose your credit card entirely If you're continuing to not make the payments and we suspect that these credit events sort of foreshadow lots of other financial domains that we weren't able to look at. This could be things like losing a home or a business because you're not paying a mortgage or property taxes, and things that can just be really financially catastrophic for individuals and their families.
Chin: You describe a whole spectrum of pretty scary consequences, something as being as far as paying a penalty or repeated penalties all the way to losing your credit so that you wouldn't be able to get loans to those catastrophic ones of potentially losing your assets in your home. Frankly, this is a population of people who are going to need these assets more than others because we know that the cost of care for people with dementia is so high in our current healthcare system. I think this is really critical and you do touch on some of the limitations in not being able to see people's personal investments and financial bank accounts. One of the other things that you mentioned, too, is that you did look at individuals that lived alone. Do you think this would be different or the impact would be different if there was another family member present in that household?
Nicholas: We've definitely seen some evidence in work that my co-author, Joanne Hsu, has led where she's actually looked at what happens in households where the primary financial decision maker starts to develop cognitive impairment. She finds that in some cases, but not all, the other spouse starts to take over responsibility for financial decision-making, so this can be protective if somebody else is able to see these early signs and step in. We suspect that these effects might be a little bit more muted in coupled households, although we will be formally testing that in some of our future work.
Chin: And that's exciting to know that you're going further with this and exploring the other different scenarios in which people are living. So often in healthcare, we're confronted with this question of what's the point in diagnosing someone with a progressive disease like Alzheimer's because there is no cure. I feel like your data in your publication is one specific answer in response to this argument. While there may not be disease-modifying therapy, there are social and or financial benefits in identifying the disease early. You hint at this when you say financial planning. What types of resources are available for people after a diagnosis when it comes to these sorts of financial consequences?
Nicholas: There's a few ways that people can proceed. I would say, as economists, we definitely interpreted these financial benefits as a strong reason to try to diagnose earlier. I think those who focus on the clinical and ethical sides can give a more balanced picture of some of the trade offs, but on the financial side there's sort of informal reliance on family members, friends, anyone that you trust to take over management of your money. There's also, I would say, a growing business in the private sector that tries to provide financial management services that will even sort of monitor your accounts and step in when it looks like you're starting to forget to make payments or things like that. You know, it could be something as simple as deciding that you're going to move all of your payments to autopay or deciding that you want somebody else to be able to look at your accounts to be called if something suspicious happens. There's a relatively recent public policy that has required banks to try to collect emergency contact information for all of their account holders, but this is something that is voluntary to decide whether you're going to participate in. I know I've deleted those emails several times that say you should really do this and I should probably listen to my own research and notify an emergency contact.
Chin: Those are both great resources and in my memory clinic, we often advocate for people to have someone they trust as a financial power of attorney and to make it official with proper documentation. I appreciate also your comments about involving one’s bank so that the bank could help step in if needed, especially for those that don't have someone that they can rely on and trust as far as a family or friend goes. I wonder, then, what do you hope this research is going to lead to?
Nicholas: We're hoping that we'll start to see more of a policy response to creating a financial world that's increasingly able to deal with a growing dementia population. This can be things like expanding these emergency contact procedures we've talked about. Many banks will kind of straight up tell you that they suspect cognitive impairment in many of their older clients just based on sort of changing request patterns where suddenly someone who's always made payments on time is starting to miss them, or calling and just asking for things that don't make sense, or seem very confused. There isn't really any path forward for these banks to use this information so we can imagine something like an early-warning system that would better collect some of these symbols and make it easier for banks to report that information either to an emergency contact you've notified, or to a doctor, or put you on a list that says ‘we're worried’ so that when you miss a credit card payment or a utility payment, they don't turn off your lights without going to check in on what's happening, for example. I think the sort of downside of some of these policy responses is they can be sort of a scary use of data, and so thinking about how we can do this in ways that protect privacy and autonomy completely is going to be a big interdisciplinary challenge moving forward.
Chin: You’re suggesting that a system change is needed and changes that protect the individual by expanding the community of people to be thinking about this individual who may need help. I think it makes sense but it does sound complicated. It does seem like it's needed based on what you've already found in your work. For some of our audience members who may have family members that they're worried about or just thinking for the future themselves, what are some clues people could watch for to recognize someone who might be experiencing financial troubles due to cognitive decline?
Nicholas: I think some of the best signs are letters that come in the mail responding to missed payments. This is a little bit of a downside of everyone moving towards electronic communication is some of these flags may become less obvious over time and I think that can be a reason to think about signing up for some of the electronic alerts and letting that second person also access your account. Another thing that can be tricky is, while in earlier times something like a phone call saying you missed this payment would be likely to be informative, now it seems like there's a much higher chance those phone calls themselves are scams and trying to get you to give up a credit card number, a bank account, something that would actually perpetuate the problem. Tools like getting people on do-not-call lists and just restricting opportunities for scammers to get involved can be really helpful.
Chin: You have used Medicare data to also look at the other end of the disease-course for someone with dementia. In particular, you did a study in 2014 where you looked at people's severe dementia and found that those with a living will had less aggressive end-of-life care than those without. How do you see financial data being useful in addressing critical care and ethical issues, such as palliative care at the end of life, or simply caring for people with a progressive disease like dementia?
Nicholas: I think there's two main ways that this data could be helpful. One is as we get better at identifying these early financial warning signs in data and can hopefully develop tools that can be used in the clinical context, it really increases our ability to identify those who are at heightened risk of requiring surrogate decision making near the end of life at a time when they're still going to be cognitively able to provide informed consent, to talk about what type of care that they might like to receive in the future. We know that we tend to provide a lot of aggressive care to dementia patients that does not increase their length of life, and actually harms quality of life. That's because it's sort of the medical default; if you haven't said that you don't want these treatments, then the hospital will typically provide them to you. We've seen people with written advanced directives indicating that they would prefer more palliative care do seem to receive care consistent with their wishes. A real challenge is once someone has sort of developed a more advanced dementia, it can be hard to kind of have these conversations or know how to use information that they may provide so tracking this earlier when people can still step in I think is really helpful. We're also trying to understand the predictive potential of some of these financial outcomes to track those who are at risk for hospitalization and other adverse health outcomes once the dementia has developed. It’s possible that this could become a useful tool. You can also think about if we could see regular consumption data, being able to understand when people may not be purchasing food anymore or kind of need to move to a different care setting. I think we usually want to keep people in the home and independent for as long as possible and it may be that if we trade off a little bit of data and information-sharing, we can do a better job of maximizing the time that we can be home and have a quick alert when it's time for additional assistance here.
Chin: Well, thank you for the work you do and this added perspective for those of us living and working in the clinical aspect of dementia care. It seems very clear how important and beneficial it is to have this kind of input. I'd like to thank you for being on Dementia Matters, and we do hope to have you back in the future.
Nicholas: Yep, I'd love to be there. We really appreciate everything you guys are doing on the clinical side and sort of hope to help inform care going forward and really enjoy all these interdisciplinary collaborations.
Outro: Please subscribe to Dementia Matters on Apple Podcasts, Spotify, Podbean, or wherever you get your podcasts. And rate us on your favorite podcast app — it helps other people find our show, and lets us know how we are doing. Dementia Matters is brought to you by the Wisconsin Alzheimer's Disease Research Center. The Wisconsin Alzheimer's Disease Research Center combines academic, clinical, and research expertise from the University of Wisconsin School of Medicine and Public Health and the Geriatric Research Education and Clinical Center of the William S. Middleton Memorial Veterans Hospital in Madison, Wisconsin. It receives funding from private university, state, and national sources, including a grant from the National Institutes of Health for Alzheimer's Disease Centers. This episode was produced by Rebecca Wasieleski and edited by Bashir Aden. Our musical jingle is "Cases to Rest" by Blue Dot Sessions. Check out our website at adrc.wisc.edu. You can also follow us on Twitter and Facebook. If you have any questions or comments email us at firstname.lastname@example.org. Thanks for listening.