Cancer treatment costs rising at same rate as other healthcare spending, study finds
While drug prices are rising, and more treatment is done is hospitals, Community Oncology Alliance finds growth rate similar to other treatments.
Image from Flickr.
Despite recent attention to rising pharmaceutical prices, a new study claims the total costs of treating patients with cancer in the United States have risen no faster than overall costs for Medicare and commercial insurance in the past decade.
Conducted by actuarial firm Milliman, the findings contradict conventional wisdom that cancer care costs have rapidly outpaced other healthcare spending trends. In fact, the results found that total costs of treating patients with cancer have increased at essentially the same rate as all healthcare spending since 2004.
Commissioned by the Community Oncology Alliance, the study looked at claims data for Medicare and commercially insured patient populations from 2004 to 2014. Aside from discovering that the increases in costs during that period were essentially the same in actively treated cancer patients and the non-cancer population, it also found that drug spending -- which made up one-fifth of the total costs in actively treated cancer patients in 2014 -- has increased at the highest rate of all component costs, fueled by new biologic cancer drugs.
[Also: UCLA sells royalty interest in prostate cancer drug Xtandi for $1 billion]
Cancer care has also moved into the more expensive hospital setting since 2004, an important driver of the increase in the care costs.
Per-patient costs for the total population, actively treated cancer population, and non-cancer population increased at very similar rates over the 11-year study period. Among Medicare recipients, the increases were 35.2 percent per patient per year for the total population, 36.4 percent for the actively treated cancer population, and 34.8 percent for the non-cancer population.
For the commercially insured, the cost increases were 62.9 percent for the total population, 62.5 percent for the actively-treated cancer population, and 60.8 percent for the non-cancer population.
For this study, Milliman researchers defined "actively treated" cancer patients as those with one or more claims for chemotherapy, radiation therapy or cancer surgery in a given year. "Non-actively treated" cancer patients included all members coded with a cancer diagnosis but not having one or more claims for those treatments within the year. All members without a cancer diagnosis code were considered the non-cancer population, while the total population contains all three of these groups.
The study did find large increases in spending for cancer drugs. The portion of these costs associated with all chemotherapy in the actively treated cancer population -- including biologic, cytotoxic, and other chemotherapy and cancer drugs -- increased over the study period from 15 percent to 18 percent in the Medicare population, and from 15 percent to 20 percent in the commercially insured population.
Practicing oncologists on the COA study team noted that a significant portion of the drug cost trends align with specific clinical advances in new biological therapies and breakthrough drugs.
"This study shows that drug prices are but one piece of a complex puzzle that adds up to the total cost of cancer care for patients and payers," said David Eagle, MD, a practicing oncologist at Lake Norman Oncology, and COA board and study team member "If we are to make any meaningful progress in controlling spending on cancer care we need to take a much more holistic look at all of the cost drivers, including site of service differences."
Like Healthcare Finance on Facebook
The study also took an in-depth look at cost trends in the site of service for chemotherapy infusion, finding that the site of service has dramatically shifted away from the physician office to the generally higher-cost hospital outpatient settings.
Milliman found that the proportion of chemotherapy infusions delivered in hospital outpatient departments nearly tripled, increasing from 15.8 to 45.9 percent in the Medicare population during the study period. For the commercially insured the increase was much more dramatic, leaping from 5.8 to 45.9 percent. As of 2014, 340B hospitals accounted for 50.3 percent of all hospital outpatient chemotherapy infusions among those with Medicare.
Patients who had their chemotherapy delivered entirely in the hospital outpatient setting saw much higher cost than patients whose chemotherapy was delivered solely in a physician's office. For Medicare patients, the difference was $13,167, or 37 percent, higher in 2004, and $16,208 higher in 2014, a jump of 34 percent; for commercially insured patients it was $19,475 higher in 2004, a 24 percent increase, and $46,272 higher in 2014, or about 42 percent.
Twitter: @JELagasse
