Paying for Cancer Therapies – Pacific Research Institute

Paying for Cancer Therapies

While health insurers pay for diagnosis, surgery, and intravenous chemotherapy for cancer patients, they balk at paying for oral anticancer pills dispensed by pharmacies, according to a New York Times story. Although the new drugs are expensive, the journalist figures that they are surely cheaper conventional alternatives. So here’s the obvious question: “If the retail drugs are better and cost less than the office-based therapies, why wouldn’t profit-maximizing insurers pay for them?”

One answer may be that the supposition is wrong. The new drugs may have side effects that the article never discusses. There may be benefits to having cancer patients come to a clinic or a doctor’s office for treatment to ensure adherence to therapy.

Obviously impatient with such questions, the state of Oregon has come to the rescue, by mandating health benefit plan coverage for oral anticancer drugs if a plan also covers other cancer treatments.

How did the Oregon legislators decide this was a good thing to do? According to Oregon law, a sponsor proposing a new mandated benefit is supposed to provide a report on the costs, efficacy, and other effects of mandating the benefit. The purpose of the law is to ensure that the costs do not outweigh the benefits. I telephoned the sponsoring legislator’s office, which (very kindly) informed me that the legislative counsel had advised that this mandate did not call for the legally required analysis.

So, we’ll never know what the costs and benefits of this mandated benefit are. The pace of imposition of mandated benefits for health insurance has increased in recent years, with little critical examination by legislatures (or journalists). This legislative overreach has dramatically reduced Americans’ scope of choice in health insurance.

Nothing contained in this blog is to be construed as necessarily reflecting the views of the Pacific Research Institute or as an attempt to thwart or aid the passage of any legislation.

Scroll to Top