Abstract
BACKGROUND:
This paper analyses the costs and benefits of commissioning memory services for early diagnosis and intervention for dementia.

METHOD:
A model was developed to examine potential public and private savings associated with delayed admissions to care homes in England as a result of the commissioning of memory services.

FINDINGS:
The new services would cost around pound sterling 220 million extra per year nationally in England. The estimated savings if 10% of care home admissions were prevented would by year 10 be around pound sterling 120 million in public expenditure (social care) and pound sterling 125 million in private expenditure (service users and their families), a total of pound sterling 245 million. Under a 20% reduction, the annual cost would within around 6 years be offset by the savings to public funds alone. In 10 years all people with dementia will have had the chance to be seen by the new services. A gain of between 0.01 and 0.02 QALYs per person year would be sufficient to render the service cost-effective (in terms of positive net present value). These relatively small improvements seem very likely to be achievable.

INTERPRETATION:
These analyses suggest that the service need only achieve a modest increase in average quality of life of people with dementia, plus a 10% diversion of people with dementia from residential care, to be cost-effective. The net increase in public expenditure would then, on the assumptions discussed and from a societal perspective, be justified by the expected benefits. This modelling presents for debate support for the development of nationwide services for the early identification and treatment of dementia in terms of quality of life and overall cost-effectiveness.