Cancer Treatments 101 - The Remarkable Rise in Cancer Care Costs

Cancer patients and their insurers are seeing the chemotherapy and overall cancer treatments cost rise dramatically.

One reason for the sharp increase in prices is that new cancer drugs entering the market are becoming more and more expensive. In addition, many existing cancer drugs are also seeing price hikes.

According to a report from the Kaiser Family Foundation, the cost of chemotherapy has increased by an average of 7% annually over the past decade. The average out-of-pocket cost for a cancer patient undergoing chemotherapy is now about $2,400 per month.

This trend is only expected to continue as more expensive new cancer drugs come onto the market and prices for existing drugs continue to increase. Cancer patients and their families are bearing an increasingly large financial burden as a result.

There are several factors driving the rising costs of cancer care. One is the increasing cost of new cancer drugs. Many of these drugs are very effective, but they come with a high price tag. For example, the new immunotherapy drug Keytruda costs about $150,000 per year.

In addition, the prices of many existing cancer drugs have been increasing in recent years. This is due to a variety of factors, including drug company price hikes and the increasing cost of raw materials.

The rising costs of cancer care

Cancer patients and their families are struggling to cope with the rising costs of care. Many are forced to make difficult choices, such as whether to pay for food or medicine. Some may even be forced to declare bankruptcy.

It is a major problem that needs to be addressed. It is putting a tremendous financial burden on patients and their families. There needs to be more transparency around drug prices, and efforts need to be made to bring down the cost of care.

Patients say, "'I've been treated with Herceptin for breast cancer for several years and it was always $5,000 for the drug and suddenly it's $16,000 -- and I was in the same room with the same doctor same nurse and the same length of time'," said Dr. Donald Fischer, chief medical officer for Highmark, the largest health plan in Pennsylvania.

Like other insurers, Highmark found that when hospital systems bought doctors' practices, chemotherapy costs rose because physicians' offices were then deemed "hospital outpatient centers" and could charge more for overhead.

Now insurers are pushing back. In what may be the first move of its kind, Highmark in April stopped paying higher fees for chemotherapy drugs given to patients whose doctors work for hospitals, instead of paying the same price they would have had the doctor remained independent.

"The pendulum has swung toward hospitals buying up physician practices to get better revenue," Fitch said.

Other insurers are trying different ways to hold down costs. WellPoint, one of the nation's largest insurers, will soon begin paying oncologists a bonus of $350 a month per patient for sticking with specific, less-costly, chemotherapy regimens. Florida Blue has partnered with some doctor practices to create cancer-specific "accountable care organizations" that reward doctors if the new organizations save money while hitting quality targets.

And UnitedHealthcare, the biggest insurer by market share, is expanding a pilot project that uses flat, or "bundled," payments for the treatment of certain cancers – which include the cost of drugs.

 Drugmakers worry about innovation

If prices continue to be blamed for cost increases, said Robert Zirkelbach, a spokesman for the trade group Pharmaceutical Research and Manufacturers of America.

"We're concerned that short-sighted policies could undermine efforts to bring new cures and treatments to patients," he said.

Innovation is important, but it is not the only factor driving up costs, said Dr. Peter B. Bach, director of the Center for Health Policy and Outcomes at Memorial Sloan-Kettering Cancer Center in New York.

"The main reason cancer care is so expensive in the United States is not that we're doing a lot of new things," he said. "It's that we're doing the same things, but we're doing them for everybody."

Bach and others point to a host of factors that have driven up the cost of cancer care, including the rising price of drugs, expensive new diagnostic tests and treatments, more use of hospital services, and higher salaries for doctors.

The solution, they say, is not to restrict access to new treatments but to find ways to use them more efficiently and focus on preventing cancer in the first place.

"Cancer is a very expensive disease to treat," said Dr. Otis Brawley, chief medical officer of the American Cancer Society. "But it's also a very preventable disease."

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