How to Curb the Cost of Cancer Care

October 15, 2012

Top health care experts meeting at the Institute of Medicine last week delivered a stern message to the nation’s 15,000 oncologists and their patients: Either learn to deliver care at lower costs or watch the government and insurance companies impose limits.

“If you think this is a tough reimbursement environment, just wait a year or two,” said Mark McClellan, who headed the Centers for Medicare and Medicaid Services during the George W. Bush administration. “Leadership is needed to show how to get to better care on a more sustainable fiscal path.”

The sentiment was echoed by Ezekiel Emanuel, an oncologist and top adviser to the Obama administration during the battle to enact the Affordable Care Act, which imposed a first round of payment restrictions on Medicare providers. “We can never get too much cost control,” he said. “There’s $700 to $800 billion of waste in the health care system. We have a long way to go.”

Oncology has become a focal point in the health care cost control debate because its claims are rising faster than other specialties. New drugs coming on the market, many of which only extend life for a month or two, now cost $100,000 a year or more. They have become a major driver of rising cancer care costs, especially when used in terminally-ill patients nearing the end of life.

A top official from UnitedHealthcare, the nation’s largest insurer, told the forum reimbursement for cancer care now accounts for 12 percent of all payments for patients not on Medicare and Medicaid. That’s up from 10 percent five years ago. Cancer care has now pulled even with cardiovascular care as the insurer’s biggest expense.

The company’s fastest growing expense within cancer care is drugs, which continue to rise at about 10 percent a year. While drug costs are about 10 percent of all health care costs, according to CMS, they account for about a quarter of all cancer care costs.

“There is no market. It is sellers dictating the price when a new drug comes out,” said Lee Newcomer, chief oncologist at UnitedHealthcare. “I don’t have a substitution effect I can enforce because just about every state in the nation requires that I pay for the latest drugs.”

With 80 to 85 percent of the 1.64 million Americans who get diagnosed with cancer every year receiving their treatment at community-based oncology practices, the IOM meeting focused on potential changes in those settings that might lower costs. Read more »

No Insurance A Death Sentence for Some

October 12, 2012

Republican presidential nominee Mitt Romney’s latest statements on health insurance, delivered to the editorial board of the Columbus Dispatch last week, haven’t received enough attention. “We don’t have people that become ill, who die in their apartment because they don’t have insurance,” he said. “We don’t have a setting across this country where if you don’t have insurance, we just say to you, ‘Tough luck, you’re going to die when you have your heart attack.’ No, you go to the hospital, you get treated, you get care, and it’s paid for, either by charity, the government or by the hospital.”

Is Romney wrong? Do people die because they don’t have health insurance? Otis Brawley, the chief medical officer of the American Cancer Society, opens his stunning new book, “How We Do Harm” with an anecdote about a middle-aged black woman who arrived at Grady Hospital in Atlanta with one of her breasts wrapped in a moist towel. Her untreated breast cancer had advanced to the point where she suffered an “auto-mastectomy.”

Early on, Edna had some insurance, which didn’t do her any good. Her employer wouldn’t let her take just two or three hours of sick leave to go to the doctor. . . . Acknowledging the physical problem and facing the consequences became increasingly difficult. Edna tells me that she feared the disease, but she also feared the system. Would the doctors scold her? Would they experiment on her? . . . Edna’s decision to stay out of the medical system was about fear: fear of breast cancer, fear of the medical profession, fear of losing the roof over her kids’ heads. Fear intensified after her employer started to require copayments from workers who wanted to be insured. This extra $3,000 a year made health insurance too expensive to keep.”

Uninsured and afraid, she delayed coverage. Her breast fell off. She showed up at the hospital. And shortly thereafter, despite last ditch heroic efforts by Grady doctors, she died.

American Cancer Society epidemiologists estimate that the lack of insurance annually costs eight thousand Americans their lives due to inability to receive cancer treatment. Even if you have insurance that will pay for your treatment, you may still not be able to afford to receive it.

Cancer isn’t the only arena where people die because of holes in the U.S. insurance system. Here’s a list of studies unearthed by when this issue came up earlier this year:

• A 1993 examination of 1971 through 1987 data on 25- to 74-year-olds from the National Health and Nutrition Examination Survey found a 25 percent higher risk of mortality for the uninsured compared with the insured, after adjusting for various factors, such as age, smoking, alcohol consumption, obesity, education and income. The study, by lead researcher Peter Franks, was published in the Journal of the American Medical Association.

• In 2002, the Institute of Medicine, basing its work on the Franks study and another examining Current Population Survey data, found that 18,000 people (age 25 to 64) died because they lacked health insurance in 2000. (Ayanian added in his testimony that for those with heart disease or cancer and without health insurance, the risk of death for the uninsured could be 40 percent to 50 percent higher.)

• In 2008, the Urban Institute updated the IOM numbers, using later Census Bureau estimates on the uninsured. It found that in 2006, the number who died because of a lack of insurance was 22,000. The Urban Institute also said that the IOM figure “may have underestimated the number of deaths” by trying to calculate different mortality-rate differences for each age group, an approach the Urban Institute said wasn’t well grounded in the research. Applying a mortality-rate difference to the entire population under study produced an even higher number, 27,000.

• The latest report by Harvard researchers used the methodology of IOM but more recent data. It found that the uninsured are 40 percent more likely to die prematurely. And it expanded the age group a bit, estimating that among adults age 18 to 64, there were 35,327 deaths linked to a lack of insurance in 2005. Calculating the estimate without a breakdown by age group increased the figure to 44,789.

• A 2007 report published in the Journal of General Internal Medicine examined data for adults age 45 to 64 from the Atherosclerosis Risk in Communities Study, sponsored by the National Heart, Lung and Blood Institute, finding that the uninsured had a 26 percent higher mortality.

• A 2004 study published in the journal Health Affairs looked at data for those age 55 to 64 in the Health and Retirement Survey. It controlled for socioeconomic factors and found the uninsured in the group had a 3 percent higher risk of dying over an eight-year period. The study called uninsurance the third leading cause of death for that age group, saying that more than 13,000 yearly deaths “may be attributable to the present lack of insurance coverage among the near-elderly.”

Obama administration adviser Neera Tanden, the operating chief for the Center for American Progress, issued a scathing denunciation of Romney’s more recent comments on the uninsured. One  can only hope the president familiarizes himself with the literature before next week’s debate so he can press the Republican nominee on what his plans are for preventing these needless deaths should he become president and sign a bill repealing Obamacare.

Romney Benefits As Bain Ships Jobs to China — Again

October 10, 2012

From today’s New York Times front page story on Romney’s “get tough on China” claims (see especially the last paragraph):

Mr. Romney also has millions invested in a series of Bain funds that have a controlling stake in Sensata Technologies, a manufacturer of sensors and controls for vehicles, aircraft and electric motors that employs 4,000 workers in China. Since Bain took over the operation in 2006, its investment has quadrupled in value. Bain continues to own $2.6 billion worth of Sensata’s shares.

Two years ago, Sensata bought an operation that made automobile sensors in Freeport, Ill. At the first meeting with the plant’s 170 workers, Sensata managers announced that by the end of 2012 all the equipment and jobs would be relocated, mostly to Jiangsu Province. Workers have staged demonstrations, pleading for Mr. Romney to intervene on their behalf.

Chinese engineers, flown to Freeport for training on the equipment, described their salaries as a pittance compared with Freeport wages. Tom Gaulrapp, who has operated machines at the factory for 33 years, said he fears he will go bankrupt after he loses his job on Nov. 5.

“This goes to show the unbelievable hypocrisy of this man,” he said of Mr. Romney. “He talks about how we need to get tough on China and stop China from taking our jobs, and then he is making money off shipping our jobs there.”

It is often difficult to determine precisely how much Mr. Romney benefits from specific investments by Bain funds, since his money goes into a pool used to buy stakes in companies. In the case of Sensata, however, it is clearer because he reported a charitable donation of $405,000 in Sensata stock that he received as “partnership distributions” in 2010 and 2011, according to his tax returns.

The $78 Pill

October 9, 2012

Gilead Sciences has set the wholesale price for its new once-a-day HIV/AIDS pill: It’s $28,500 a year. That works out to $78 per pill.

Earlier this year, the Clinton Foundation reported that it has secured generic drugs for delivering combination HIV/AIDS therapy in the developing world for $200 per year. Of course, that requires taking multiple pills several times a day, which makes compliance more difficult.

Gilead’s four-drug combo pill, taken just once a day, clearly is an innovation. But is it really 140 times more valuable than a generic approach? Perhaps the U.S. health care system should sign up for help from the Clinton Foundation.

Why Obama Now — the latest video making the rounds

October 8, 2012

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