By John Mach, M.D.

From a care management perspective, people with dementia are a top cost driver in Medicare Risk Populations, but they are historically not enrolled in complex care management that could lower costs and improve care. In the following article, I outline what health plans and value-based providers can do about it.

The Evolution of Care Management

Care management has long been foundational to population health and value-based care. Initially focused on single chronic diseases like heart failure or diabetes, care models for older adults evolved as evidence mounted that it is the coexistence of multiple chronic conditions—rather than any single disease—that drives poor outcomes and high costs. This recognition led to the development of more comprehensive complex care management (CCM) strategies.

Evidence-Based Approaches for Older Adults

Efforts to optimize CCM have clarified essential success factors: a primary care-centered model, comprehensive assessments across medical, behavioral, and social domains, coordination across settings, caregiver involvement, self-management support, and integration with community resources.

Because CCM is a high-touch, resource-intensive service, its effectiveness hinges on accurate targeting. Programs have shifted from backward-looking cost thresholds (which suffer from regression to the mean) to prospective risk stratification using predictive analytics from claims, EHRs, and other data.

With these refinements, CCM has delivered substantial benefits across domains such as behavioral health integration, comprehensive medication management, care transitions, hospital-at-home models, home-based primary care, and palliative care. A common impact across these programs: fewer unnecessary hospitalizations.

The Age-Friendly Health System (AFHS) initiative has distilled these best practices into the “4 M’s”: What Matters, Medication, Mobility, and Mentation. This framework is rapidly spreading and demonstrating early success.

Dementia: An Overlooked Opportunity in CCM

The “Mentation” component of AFHS has taken on new urgency with CMS’s launch of the GUIDE Model, which supports people living with dementia (PWD) and their family caregivers. Dementia is now recognized as the second most costly condition in Medicare, accounting for up to 20% of all spending. Over 95% of people with dementia have multiple chronic conditions, and their combined effect multiplies hospitalization risk.

Yet despite this profile, PWD are almost completely absent from CCM enrollment. One study showed that fewer than 0.2% of those who enrolled in a GUIDE-like program were enrolled in a health plan’s existing CCM program.

Why is that? Two key reasons:

1. Predictive analytics often miss dementia. Diagnoses are frequently buried deep in claims hierarchies or coded as secondary, so standard risk models under-detect this population. A more dementia-aware claims strategy is needed.
2. The family caregiver is the true point of contact, but most CCM programs are not designed to engage with caregivers during outreach or enrollment.

Given the fiscal pressures facing value-based Medicare organizations, identifying this overlooked high-risk group presents a compelling opportunity.

What Dementia Care Management Requires

Once dementia is diagnosed, the caregiver—not the patient—is the fulcrum of effective care management. PWD are typically unable to self-manage, communicate needs, or navigate healthcare systems. Caregivers become responsible not just for daily tasks but also for emotional support, medical coordination, and crisis management.

Caregivers need more than token involvement—they need specialized support, including:

• Training in non-pharmacologic behavioral interventions, to avoid unnecessary and potentially harmful medications
• Coaching and remote monitoring tools, so they can detect subtle signs of clinical decline and act before a hospitalization is required

These elements are not typically found in conventional CCM programs, but they are essential to avoid hospitalizations and maintain stability at home.

Practical, Scalable Solutions Exist

Effective dementia care management requires expert caregiver engagement, live coaching, and home-based technology. This model dramatically lowers hospitalizations and costs while achieving exceptional caregiver satisfaction. Proven methods now exist to identify eligible PWD in claims data, engage caregivers, and deliver results at scale, including in Medicare risk contracts.

Why Outsourcing May Be the Right Approach

While CCM programs aim to manage high-need, high-cost patients, dementia is a special case. Because enrollment is so low and the care requirements so specialized, outsourcing dementia care management may be the most efficient and immediate solution. Vendor partners now exist with the content, infrastructure, and track record to deliver results with minimal lift from your internal team.

Conclusion

Dementia represents a large, unmanaged, high-cost subpopulation in Medicare risk contracts—and a unique opportunity for value-based organizations to improve outcomes and reduce costs. Family caregivers are central to success. Supporting them with the right tools, coaching, and structure makes the difference.

For health plans and providers in value-based care arrangements, outsourcing dementia care management is a rare win-win: it drives better care, lowers total cost of care, and fills a major gap in current CCM programs.

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Dr. John Mach is a geriatrician and serves as the Chief Medical Officer of Ceresti Health.

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