Hospitals Massively Mark Up Cancer Treatment Prices For Private Insurance Patients, JAMA Study Finds

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Diving brief:

  • Research over a six-month period last year shows that US hospitals tag the price of cancer therapies for patients with private health insurance, in some cases charging them more than seven times what it costs hospitals to acquire the drugs, according to a study published Monday in JAMA Internal Medicine.
  • Prices varied widely across payers and study facilities, with the median drug price mark-up across all cancer centers and payers ranging from 118% and 634%.
  • The researchers also found that most facilities designated by the National Cancer Institute did not publicly disclose payer-specific prices for cancer treatments, as required by federal price transparency regulations.

Overview of the dive:

Last year, the federal price transparency rule requiring hospitals to disclose the negotiated prices for the services came into effect. But that hasn’t stopped hospitals from charging very variable costs for procedures, sometimes even within the same establishment.

This is also true for cancer therapies, as JAMA researchers found that most cancer centers do not follow the price disclosure rule, and the prices they charge differ significantly from center to center. to another and for patients with different private insurance coverage.

The researchers examined private-payer-specific negotiated prices for 25 commonly used injectable or infusible cancer therapies at 61 NCI-designated facilities. They used publicly available hospital price transparency files, conducting the study from April 1 to October 15, 2021.

Of the 61 NCI-designated cancer centers analyzed, only 44% disclosed private-payer-specific prices for at least one top-selling cancer therapy.

Across hospitals, price ratios for cancer treatments ranged from 2.2 for pertuzumab to 15.8 for leuprolide.

At the same cancer center, cancer therapy price ratios varied between payers from 1.8 to brentuximab to 2.5 for bevacizumab.

At one center, negotiated prices for 7.5 mg of leuprolide ranged between $692 and $3,284 per milligram, the researchers found.

Public policies aimed at discouraging or preventing excessive hospital price markups on cancer treatments could benefit patients, as rising costs are a major concern, the researchers wrote.

According to the study, US spending on cancer therapies rose from $39.1 billion in 2015 to $67.5 billion in 2019, largely due to the market power of manufacturers and hospitals.

Manufacturers benefit from time-limited monopolies during periods of patent and regulatory exclusivity, and hospitals then institute high prices for cancer therapies from private insurers, the researchers wrote.

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