Why Cancer Care Costs So Much

Oncologists typically make more money if they use newly approved drugs and the latest radiation treatments than if they use cheaper, older alternatives that work just as well. (This is because they get paid back the cost of the drug, in addition to an extra 6 percent of that cost — the more expensive the drug, the higher the compensation.)

Some of these new therapies are rightly heralded as substantial advances, but others provide only marginal benefit. Of the 13 anticancer drugs the Food and Drug Administration approved in 2012, only one may extend life by more than a median of six months. Two extended life for only four to six weeks. All cost more than $5,900 per month of treatment.

Source: The New York Times.

Comments (11)

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  1. Jordan says:

    The brand name and generic relationship is interesting as well. Research groups backed by big pharm developing warning labels and doctors receiving commission. Ugh.

  2. Linda Gorman says:

    A month here, a month there, pretty soon it adds up to a few decades.

    Compare the very brief remissions in the early 1960s with the current survival rates for lymphocytic leukemia and Hodgkin’s disease.

  3. Antonio Servantes says:

    This is just painful to read. It hurts to think that financial gain on one end is taken advantage of at the expense of another person’s struggle to afford treatment to save his/her’s life.

  4. Ryan Hall says:

    The more I read about our health care system, the worse it gets. However, nothing is as bad as directly suffering from the industries dysfunction when staggering bills are sent your way as you’re trying to survive.

  5. Espy says:

    Linda’s right — these things do add up over the course of years.

  6. Vladamir Viatopolkovsky says:

    So much for the Hippocratic oath!

  7. Landon George Barnwll Tate says:

    $5,900 a month is $70,800 a year. That is close to $30,000 more than the average wage in America. Is it any wonder why cancer patients from wealthier zip codes survive cancer at higher rates than patients from poor zip codes?!

  8. H. James Prince says:

    And the economist asks: if the marginal benefit of that additional month is less than $5,900, why do we prescribe the medication? I don’t mean to be overly calloused, but it seems that it is more dignified to settle your affairs, see your family, and then die in peace.

  9. Buster says:

    On the one hand, Linda is correct that most advances in cancer care have been incremental. We don’t want to impair incremental improvements. On the other hand, we need a better system to reward true innovations without overly compensating new therapies that provide little incremental improvement.

    The death rate from childhood leukemia has declined by something like 80% in the last few decades. Much of this decline has been in a better understanding of how to use established oncology drugs rather than the discovery of new miracle drugs.

  10. Linda Gorman says:

    Would people be commenting on the reasonableness of this spending if cancer patients were funding their own treatment out-of-pocket or with insurance that they paid for?

  11. Bob Hertz says:

    In most other countries, the national FDA (whatever it was called) would be setting the maximum price of the drug at the time of approval

    In addition, most oncologists in those countries would be on salary and not paid per episode.

    This might lead to worse survival rates for advanced cancer, at least the data suggests that.

    But it would solve the price-gouging problem. Tough call.