Partisan fighting over skyrocketing Medicare costs has dominated the nation's healthcare discussion, overshadowing critical issues that must be addressed immediately.
We need a health care system that encourages medical innovation and drug creation. Ours is currently being constrained by regulatory complexity, patent expirations, budget cuts and uncertainty about litigation exposure. At the same time, we need to determine ways to trim spending and cut costs on excessive and expensive parts of health care.
One issue of great concern is the rising costs associated with treating cancer. Although better cancer detection and decades of developing innovative cancer treatments are increasing cancer survival rates, this progress is also driving up the amount that is spent on cancer medicines.
The good news is that by 2020, the number of U.S. cancer survivors may rise 30 percent, to 18 million. Since 1980, life expectancy has increased about three years – 83 percent of those gains are attributable to new treatments. One study found that since 1975, medicines have accounted for 50 to 60 percent of survival rate increases.
A new report from the National Cancer Institute found death rates fell about 1.6 percent yearly between 2003 and 2007. Such a decline is immensely valuable for our healthcare system. According to research by University of Chicago economists, decreasing cancer death rates by 10 percent would be worth approximately $4.4 trillion in economic value to current and future generations.
Last year saw great progress in the development of new cancer treatments. An American Society of Clinical Oncology (ASCO) report identified 12 major advances last year, eight of which related to new medicines.
Unfortunately, this improvement has resulted in higher costs.
The National Cancer Institute estimates that medical costs associated with cancer could rise to $207 billion by 2020. Last year, according to Medco's annual Drug Trend Report, prices for oncology medications rose 11.5 percent.
This is in part due to increased use, but largely because the costs of the therapies themselves are increasing and there is a limited amount of generic equivalents for these specialty drugs. Over 90 percent of anti-cancer drugs approved since 2004 cost more than $20,000 – and few generic equivalents exist.
This increase in costs is felt by consumers and negatively impacts patients' treatments. A new study by the “Journal of Oncology Practice” and the “American Journal of Managed Care” found 10 percent of patients failed to fill new prescriptions for oral cancer drugs.
People with high cost-sharing insurance plans and those taking several drugs were more likely to quit treatment.
Patients with prescriptions that had cost sharing of over $500 were four times more likely to abandon their medication than those with cost sharing of $100 or less, and 16 percent of new patients had out-of-pocket costs of over $500.
These findings are alarming. How can we address the increasing costs of cancer treatments and subsequent abandonment by patients?
Policies must be developed to encourage treatment adherence. Continued and preventative treatments decrease serious illness and costly treatment down the road. A study of diabetes patients found those who took their medicine improperly were 2.5 times more likely to be hospitalized than those who followed their treatment regimes. Reducing hospital stays will decrease health care costs, as they account for 42 percent of all medical spending.
Policymakers must develop policies that emphasize compliance with treatment protocols. The best way to contain health care costs is prevention – that combined with public and corporate programs focusing on reducing harmful behaviors will keep medical costs from skyrocketing.
We must then work to develop and identify policies that reduce the impact of expensive prescription drug plans, as the correlation between cost sharing and drug abandonment is clear.
Medicare Part D, the prescription drug plan to subsidize the costs of prescription drugs for seniors, must be preserved.
As we work to restructure our health care system in light of the increasing and unsustainable costs of the system, we must ensure cancer patients get access to newer therapies.
Douglas Schoen is a political strategist and author of Mad as Hell: How the Tea Party Movement is Fundamentally Remaking Our Two-Party System, published by Harper, an imprint of HarperCollins.