Regional insurers in some states, including California, Washington and Pennsylvania, are negotiating similar limits with doctors and their clinics. WellPoint, another large insurer, is developing a way of paying oncologists to coordinate and manage patient care.
By almost any measure, cancer treatments can be exorbitantly expensive. Cancer care in the United States costs almost $100 billion a year, and medical bills for the average patient on chemotherapy can top $100,000 a year.
With the new health care law, everyone is under pressure to find ways to save money. Many specialists favor the most aggressive care even if there is little to no evidence the patient will benefit, because both doctors and patients have every incentive to spare no expense. Patients and their families often demand one last treatment. And oncologists can reap tremendous profits, sometimes earning more than half of their income on the difference between what they pay for chemotherapy drugs and what they charge the insurers for the patient’s treatment plan.
Dr. Lee Newcomer, the oncologist who is heading the UnitedHealthcare program, said that yearly double-digit increases in the cost of cancer care had forced insurers to confront the issue. “Oncology, or cancer care, has been a bit of a sacred cow,” he said.
With life and death questions at stake, insurers and supporters are quick to promote the new measures as a way to extract cost savings and also as a way to ensure that terminally ill patients are not subjected to unnecessary, often exhausting treatments that provide no hope.
Still, detractors worry that these changes could represent a first step toward denying patients additional treatments or the latest chemotherapy regimen based solely on the cost. In other words, they argue that even if oncologists still decide what course of treatment a patient should receive, as these new plans allow, the new effort could be viewed as a move toward rationing care at the end of life.
“We do not want to get into the realm where they are restricting treatments when they are clearly indicated,” said Dr. David Eagle, an oncologist who is the president of the Community Oncology Alliance, a nonprofit lobbying group for community oncologists, who generally practice outside of an academic medical center.
“In my view, the insurance companies have the ultimate conflict of interest,” Dr. Eagle said. But many cancer specialists acknowledge that the current payment system is unsustainable. “It has all the potential to bankrupt the system,” said Dr. Michael Neuss, an oncologist in private practice in Cincinnati. He described the existing payment plans as “our dirty little secret.”
“A lot of us want to get out of selling drugs,” he said.
Companies are also springing up to develop treatment guidelines and serve as intermediaries between oncologists and health plans. US Oncology, a network of affiliated cancer doctors, teamed up with Aetna in May to develop a program to persuade doctors to follow treatment guidelines.
Another company, P4 Healthcare, is working with Highmark, a Pennsylvania insurer, and others. Cardinal Health, the large health care services company, bought P4 in July.
“There’s a lot of money to be made and saved,” said Dr. Peter Bach, a health policy analyst and physician at Memorial Sloan-Kettering Cancer Center in New York, who also served as a consultant to the federal Medicare program.
For example, doctors could choose less expensive therapies. When an oncologist considers different treatments, “it’s hard not to look at price differentials,” Dr. Bach said. In treating one type of lung cancer, for example, doctors can select from as many as eight treatments that are generally considered appropriate. Their costs under the Medicare program range from about $1,300 to $7,000 a month.