Public Payers News

Cost of Cancer Care Reaches Nearly $150B Nationally

Many cancer patients struggle with out-of-pocket cancer care expenses, with one drug costing nearly $12,000 annually and FDA approved drugs priced over $100,000 a year.

Cancer Care

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By Samantha McGrail

- Price tags of life-saving treatments are continuing to increase, with nearly $150 billion being spent nationally per year for cancer care, four times more than treatment for other common health conditions, according to a report from The Mesothelioma Center. 

Sixy-three percent of cancer patients faced financial struggles following a cancer diagnosis. 

Cancer treatment costs were reported highest among preventable cancers such as lung cancer, colorectal cancer, breast cancer, and mesothelioma. Specifically, the lifetime cost of lung cancer was an estimated $282,000 while mesothelioma was a reported $150,000. 

One drug cost patients nearly $12,000 a year, while 11 of the 12 FDA approved cancer drugs were priced above $100,000 annually. And in 2015, cancer cost Americans aged 16 to 84 a total of $94 billion in lost earnings. 

Furthermore, nearly 20 percent of cancer patients and their families estimated they spent more than $20,000 each year in total out-of-pocket costs, the Mesothelioma Center reported. 

Out-of-pocket drug costs forced 12 percent of cancer patients to lower the dose of their prescription drugs to make them last longer. Skipping or lowering doses of vital medications puts patient’s health at grave risk. 

The hidden cost of cancer is also a serious hardship. For example, almost half of cancer patients (49 percent) reported that travel expenses related to treatment was an additional financial burden.

“People often only think up to surgery, but post-operative care is where the higher costs are. Dealing with complications and covering costs of scans, home care and follow-up treatments such as chemotherapy is when it gets really expensive,” explained Missy Miller, medical outreach director at The Mesothelioma Center. 

Despite the high cost for these cancer drugs, they aren’t always proven to work. A 2019 study published in JAMA Network Open showed that only 13 percent of patients who received checkpoint inhibitors actually benefited from the treatment. 

Low-income families, Americans who are uninsured, and blue collar workers who have medical bills four times their annual salaries are very unlikely to afford the increased costs of cancer treatments.

To put this into perspective, the annual mean wages for the top blue-collar jobs was about $50,000 in 2018, which is less than the monthly cost of some cancer drugs.

The reported average monthly income in the US is $3,600 before taxes, a third of the cost of some chemotherapy and immunotherapy infusions. And a patient with 25 percent coverage would have month out-of-pocket costs of $2,500 for a cancer drug that costs $10,000 each month, the report stated. This is almost 70 percent of the average American’s monthly income. 

And these high costs don’t affect all patients equally.

A separate study published in the Journal of Oncology Practice found that out of 55,288 patients with breast, lung, and prostate cancer, cost was based more on geography and the individual provider than patient or disease factors.

Cancer death rates are approximately 20 percent higher among residents of the poorest US counties. And eight of the ten states in southern, central, and western regions with the highest poverty rates fell in the top ten percent for cancer death rate, according to the CDC.

Millions of Americans face affordability issues, and financial hardship is common among patients who require prescription drugs. But value-based care is vital for payers to push members toward higher medication adherence by recognizing these various hardships, such as cost. 

In April of last year, the national Oncology Model of Care (OMOC) program was launched for Humana Medicare Advantage to boost experience for patients with cancer diagnoses through affordable care.

Numerous factors are taken into consideration when quality and costs are determined, including inpatient admissions, emergency room visits, medical and pharmacy drugs, laboratory and pathology services, and radiology.

The OMOC is Humana’s fourth specialty-care payment model which will further past efforts to deliver value-based, affordable healthcare to its members. The model will ensure more personal time with health professionals, personalized care that is tailored to each individual’s health situation, and access to proactive health screenings.