Some of the less expensive places just keep them fed and alive. Probably quite a few in private homes. My wife is in a quality memory care home and they have a full day's worth of activities scheduled every day. Some is exercise, some crafts, some entertainment, some musical, etc. Of course they are optional, and you have to make sure your patient takes part. They love Bingo, but some have no clue how to manage their cards. They even have a van that takes some out for tours of interest, or even Christmas shopping. All of this helps keep them alive and active as long as possible. Games like "name that tune" stimulate their brains, and music seems to remain fairly intact. My opinion is they will go downhill fast if there is no mental and physical stimulation. After a year in this home, she has lost very little mental ability. Just sitting and staring out a window is the beginning of the path to death, and I am afraid many are put on that course. Diet is also an issue. The home has a very good balanced diet, with appropriate sized portions. We would not do nearly so well if she was living at home. They are very good at getting her to take her pills, although it does take tact and patience. I even enjoy my nightly visits as it is an educational lab for people interested in Alzheimers. Of course each patient is different, and some do much better than others. I can only vouch for my one, and it has been well worth the cost.
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You are correct, that marvelous care IS well worth the cost. I know this. My brother had marvelous care.
Key is that not everyone can AFFORD this. There's the rub.