The Problem of Cancer Drugs Costs: A Payer Perspective

Chemotherapy and supportive drugs constitute 70% of a cancer patient's medical costs during active therapy. Payers use several approaches to keep those costs affordable including paying lower margins for "buy and bill" oncologists, prior authorization, pathways, or performance-based compensation. Payers also utilize financial tools such as deductibles, copayments, or coinsurance to shift more of the cost of health care coverage to employees or the insured. The strengths and weaknesses of those approaches are reviewed in this article. Policy changes that address drug protection from competition or negotiation, monopoly status of health care systems, and Food and Drug Administration approval of new medications will affect how effective any payer strategy will be in the future.