ITo examine the economic impact of Alzheimer's disease (AD) as the disease progresses on patients' medical costs and caregivers' productivity. A 12-page, self-administered mail survey, fielded in November 1999. Households with AD caregivers, selected from a nationwide (U.S.) consumer database. One thousand seven hundred fifteen caregivers of noninstitutionalized AD patients. Disease progression was measured using a scale of symptom frequency and measures of instrumental and physical functioning. Cost components included hospital days, physician visits, and emergency room visits. Lost productivity was assessed using hours per week that caregivers provided care and the number of days that they missed from work because of caregiving. The direct costs of caring for AD patients for 6 months totaled $3,129, whereas the indirect costs were $26,080. Patients with more-frequent symptoms used all healthcare resources, including the hospital, emergency room, and physicians, more often than those with less-frequent symptoms. Those with lower levels of physical and instrumental functioning also used the hospital and physicians more often than those with higher levels of physical and instrumental functioning. Caregivers of these more severely impaired patients spent more hours providing care and reported missing more work than those caring for higher-functioning patients. These relationships remained after controlling for potentially confounding factors. This large study of patients at all stages of AD shows that the direct and indirect costs of AD are considerably lower for patients with fewer symptoms. Longitudinal studies will determine the impact on the overall cost of care of interventions that reduce symptoms and maintain patients at earlier stages of the disease.