Are Many Retirees with Dementia Lacking Help?

Many older individuals with cognitive impairment, including the vast majority of people with dementia, need help managing their finances. For retirees receiving Social Security benefits, the Representative Payee Program can serve as one source of this help. In the Representative Payee Program, a retiree’s benefit is sent to another person (often a relative) who spends it on the retiree’s behalf and submits records to Social Security documenting that the expenditures were in the beneficiary’s best interest. But the program seems to be seldom used by those with dementia: of those 65 and older, over 10 percent have dementia, but just 1.5 percent have a payee. This lack of participation may not be a problem as long as the retiree has some other source of help. This brief – based on a recent paper – uses data from the Health and Retirement Study (HRS) linked to administrative Social Security records to first document what share of retirees with mild cognitive impairment or dementia use the Representative Payee Program. Given that few use the program, the brief then turns to the question of what they do instead. The options considered include help from an informal caregiver (e.g., a non-impaired spouse or child), from the staff of a nursing home, or from a Power of Attorney they may have assigned. Once these sources of help are identified, the brief then focuses on the types of people who seem to lack any observed form of aid in order to help policymakers and community-based organizations better identify the most vulnerable individuals. The discussion proceeds as follows. The first section estimates the share of retirees with mild cognitive impairment and dementia. The second section documents what sources of help people have and what share of retirees with impairment are lacking it. The third section identifies groups who are especially likely to have no observed source of help available. The final section concludes that while few retirees with dementia use the Representative Payee Program, the vast majority have some potential source of assistance. Groups vulnerable to having no help available include those with less education, minorities, and individuals living in densely populated areas.