Few medical expenditures are costlier than a cancer diagnosis. Cancer-associated medical costs accounted for approximately $88 billion in health care spending in 2014, according to data from the Agency for Healthcare Research and Quality.1 Even among patients covered by various types of insurance policies, out-of-pocket expenditures borne by cancer patients still totaled approximately $4 billion.2
The American Cancer Society Cancer Action Network (ACS CAN) has made the management of cancer care costs one of its primary missions since its founding in 2001. ACS CAN recently released The Costs of Cancer, an in-depth report addressing patient concerns about the total expenditures associated with cancer diagnoses and treatment.3 The report found that “even with insurance, cancer patients often face unpredictable or unmanageable costs, including high co-insurance, high deductibles, having to seek out-of-network care, and needing a treatment that is not covered by their plan.” The report also chronicled the many indirect costs of cancer care that patients face, including travel and accommodations for patients seeking remote treatment; loss of productivity among working-aged patients; and mental health services for patients dealing with disease-related anxiety and depression.
Journal of Clinical Pathways spoke with Jennifer Singleterry, MA, senior policy analyst with ACS CAN (Washington, DC), about the report’s findings, and the wide-ranging implications for cancer care and the associated costs in relation to health care and insurance reform.
Generally speaking, what are the chief financial concerns for patients with cancer?
One of the things we talk about in the report is the concept of affordability, and how that means both affordable premiums—because obviously, cancer patients who are insured are going to be thinking about their premiums—but also affordable cost-sharing. The report goes through the various forms of cost sharing that a cancer patient typically pays. This includes things like a deductible, in which a patient pays all of the costs until a yearly deductible amount is met. Deductibles can be anywhere from zero dollars to thousands of dollars, so that is an important element when it comes to up-front costs that sometimes surprise cancer patients who either did not know about their deductibles, or did not realize how high their deductibles were.
Beyond that, there are also copays and coinsurance. Even after a patient has met a deductible, they are often still paying either a copay or coinsurance for treatment. The important thing to know there is that copays are a flat amount that is fairly predictable if you look at your summary of benefits.
You can generally figure out what your copay is for treatments. But coinsurance, which many cancer patients do end up paying, is based on a percentage of the total costs of treatment. The problem there is that it is very hard to figure out what the total cost of treatment is before you show up at the pharmacy to pick up your drugs, or before you go to your doctor. One of the things we tried to call out in the report was the very difficult situation cancer patients face to determine what their coinsurance will be.
We tend to think that insured patients will not have anything to worry about overall, but that’s not often the case. What are some of the major roadblocks that insured patients face when they try to figure out how much cancer treatment is going to cost?
Out-of-network care is a major concern here. Sometimes cancer patients have to go out-of-network to get the right provider who has the right expertise to treat them. Sometimes patients can unintentionally go out-of-network. Let’s say you are scheduled for a surgery and the anesthesiologist was out sick that day, and the substitute anesthesiologist brought in to complete the surgery is not in the patient’s network. Cancer patients can be surprised by the bills even if they have done everything they were supposed to do, because it turns out that someone who treated them was not in-network.
It also happens that treatments are denied by a health insurance plan. Cancer patients always have appeal rights, which is important to know, but that does not mean that a treatment may still end up being denied.
What are some of the modeling exercises ACS CAN undertook for this report?
ACS CAN actually worked with our oncology experts to come up with three profiles of cancer patients. There is no average cancer patient—cancer is many different diseases, and it affects people in different ways. So we decided to take three of the most commonly seen cancer subtypes—breast cancer, lung cancer, and colorectal cancer—and came up with treatment profiles, then worked with Avalere Health4 to make costs for the treatment regimens we came up with. We applied those costs through three common insurance designations: employer-sponsored insurance, Medicare, and the individual marketplace. In the end, we came out with a mockup of what patient costs would look like.
It is important to reiterate that these really are examples, and they are not going to represent everyone’s experience with breast cancer or lung cancer treatment. We had everyone in the models get their positive screenings in January—meaning that it would come at the beginning of their plan years. Not everyone is diagnosed in January, but we did that because we wanted to model how the costs would break down over the course of the year.
Overall, in terms of cost, the patient on an employer-sponsored plan made out the best: she had the lowest premium and the lowest out-of-pocket costs once on treatment. The patient on the individual marketplace plan paid the most in out-of-pocket costs, and they hit their out-of-pocket maximum within 3 months. That is a very important point, because if that maximum—which is established in federal law—was not there, they would have paid much more. The Medicare patient represents an interesting dynamic, because the out-of-pocket costs were fairly low and fairly consistent. We did not see the huge spikes that the other patients saw, but the issue there is that the other patients were paying very high premiums. It illustrates the tradeoff of buying a plan with a higher premium and lower cost-sharing, or the opposite. These are all things that cancer patients need to be aware of when they are choosing a plan—or even when they do not have a choice, they need to be aware of their plan design.
Out-of-pocket limits must be very important for keeping costs reasonable then?
Definitely. If the health care system changes, out-of-pocket limits are one of the key patient protections that we want to protect. It needs to remain and it should not increase. There could be proposals to either increase these limits or do away with them completely, and in either case, we would be very concerned about moving in that direction.
How can this kind of research address the “hidden” costs of cancer care?
We talk about indirect costs of cancer, but they are unfortunately hard to quantify and track by their very nature. This can include everything from the loss of productivity in working-age cancer patients, to the costs of items like wigs and other items to address cosmetic side effects such as hair loss. The ACS has several programs that helps to mitigate these costs, such as helping with transportation and lodging—which are two of the biggest common costs for patients who have to travel a distance to receive their care. I would also say that another way to mitigate indirect costs would be to allow cancer patients to predict their direct costs. Direct and indirect costs are obviously connected because they come out of one budget. Being able to know roughly what you are going to end up paying that year will help the patient know what they can spend in other areas.
Do you think clinical pathways can help control cancer costs?
That is not something we addressed in the report, but it is certainly something that we are exploring. We want to be sure that doctors and patients are able to decide their appropriate treatment options together, but we know that people are exploring where clinical pathways fit into their discussion.
References
1. Agency for Healthcare Research and Quality. Medical Expenditure Panel Survey. https://meps.ahrq.gov/data_stats/quick_tables_results.jsp component=1&subcomponent=0&tableSeries=2&year=-1&SearchMethod=1&Action=Search. Accessed April 26, 2017.
2. Agency for Healthcare Research and Quality. Total Expenses and Percent Distribution for Selected Conditions by Types of Service. https://meps.ahrq.gov/data_stats/tables_compendia_hh_interactive.jsp_SERVICE=MEPSSocket0&_PROGRAM=MEPSPGM.TC.SAS&File=HCFY2014&Table=HCFY2014_CNDXP_C&_Debug=. Accessed April 26, 2017.
3. The Costs of Cancer. American Cancer Society Cancer Action Network website. https://www.acscan.org/policy-resources/costs-cancer. Published April 11, 2017. Accessed April 26, 2017.
4. Avalere Health. Avalere Health website. avalere.com. Accessed April 26, 2017.
