AbstractIntroductionEfforts to model the cost‐effectiveness of managing/modifying cognitive impairment lack reliable, objective, baseline medical, and nursing‐home (NH) costs.MethodsA stratified‐random sample of Olmsted County, MN, residents ages 70–89 years (N = 3545), well‐characterized as cognitively unimpaired, mild cognitive impairment (MCI), or dementia, were followed forward ≤1 year in provider‐linked billing data and the Centers for Medicare & Medicaid Services NH assessments. Direct medical/nursing home/medical + NH costs were estimated. Costs were stratified by vital status and NH‐use intensity (NH days/follow‐up days [0%, 1% to 24%, 25% to 99%, and 100%]). Between‐category mean‐annual cost differences were adjusted for patient characteristics and follow‐up days.ResultsCosts/follow‐up day distributions differed significantly across cognitive categories. Mean costs/follow‐up days were 2.5 to 18 times higher for decedents versus survivors. Among all persons with MCI, <9% with any NH use accounted for 18% of all total annual medical + NH costs. Adjusted‐between‐category comparisons revealed significantly higher medical and medical + NH costs for MCI versus cognitively unimpaired.DiscussionCost‐effectiveness for managing/modifying both MCI and dementia should consider end‐of‐life costs and NH‐use intensity. Results can help inform cost‐effectiveness models, predict future‐care needs, and aid decision‐making by individuals/providers/payers/policymakers.