Is Treating Cancer Worth It?

July 24th, 2008 by DrRich

Yesterday, Jacob Goldstein of the Wall Street Journal Health Blog pointed out the financial dilemma that has been created by evidence that a new cancer drug, Nexavar, is effective in treating liver cancer.

Most liver cancers are particularly impervious to chemotherapy, and until Nexavar came along no chemotherapy had ever been shown to significantly prolong survival. So when Nexavar improved the overall survival of a subset of patients with liver cancer in a well-designed randomized clinical trial (RCT) last year, the FDA (recognizing a true breakthrough when it sees one) quickly approved the drug.

The problem? Nexavar costs over $5000 per month. That, DrRich points out, is even higher than your average monthly health insurance premium. This means that any insurance company (or government) that agrees to pay for Nexavar is going to be out some big bucks.

(The good news for the payers, if there is any good news, is that Nexavar only prolongs survival by an average of three months, and the one-year survival of a population of patients with liver cancer on Nexavar is still less than 50%. Just think of the damage if Nexavar prolonged survival by several years!)

The economic question created by drugs like Nexavar - which result from extremely sophisticated and costly research and development processes, and whose benefits are undeniable but perhaps marginal - is likely to be asked several times over the next few years. We are also hearing those questions expressed, for instance, regarding the drug Avastin, which is used for lung, colon and breast cancer. Like Nexavar, Avastin has clear-cut and undeniable benefits that have been proven in RCTs. Like Nexavar it is very expensive. And also like Nexavar the duration of its benefits are measured in months, not years.

The form this economic question usually takes is: Should we really pay for extremely expensive cancer drugs like this when the expected benefit is so transient? While DrRich does not pretend to have the best answer for this question,* he will make two observations.

First, the reason it is so difficult to answer questions like this is that we in America (citizens, the government, and the insurers) refuse to acknowledge that there are limits to what we should expect from our healthcare system. We expect to receive any bit of healthcare that offers even a possibility of benefit, even if that benefit is likely to be marginal or transient. We expect our researchers to work day and night to cure every disease, no matter how rare, and we become indignant when progress does not seem rapid enough for our particular disease; indeed, death itself is merely a manifestation of insufficient research. In other words, where healthcare is concerned, there are and can be no limits.

Given this “no limits” paradigm, when our society is faced with the inescapable need to ration healthcare, that rationing can only be done covertly. There’s no other way to do it.

And under covert rationing (whose very purpose, again, is to preserve the illusion of “no limits”), there’s simply no mechanism, or even justification, for addressing questions like the one raised by Nexavar and Avastin. Our procedure is: we do the RCT, and if the RCT shows any measurable benefit, we pay for it. End of story.

So the insurers and the feds won’t be able to base their payment decision on some objective and transparent cost-benefit analysis for Nexavar, evaluating where this analysis falls in relation to all the other cost-benefit analyses they perform for all the other forms of therapy. Rather, they’re simply going to have to announce they’re paying for it. They have no other choice, because to do otherwise would question the “no limits” paradigm.

And then they’ll perform the unavoidable rationing by some covert means probably having nothing whatever to do with this particular therapy, or of any particular therapy, but rather, according to whatever means they can get away with, wherever in the healthcare system and with whichever patient that might be. That’s the job we’ve assigned to them. And they’re very good at it.

Second, the financial questions raised by Nexavar, Avastin, and similar therapies point out yet again that the Axiom of Industry often invoked by healthcare policy experts - that is, that improving quality will always reduce cost - simply does not work in healthcare. There are many, many times when achieving the best possible clinical outcomes (i.e., optimizing quality) greatly magnifies the cost of medical care.

The real problem with Nexavar and Avastin is not that their beneficial effect is just transient. That fact, to be sure, gives insurers and commentators a convenient handle, some basis for whining about these drugs that will engender sympathetic murmurs from certain quarters (though, as we have seen, it will ultimately not get them out of paying for them). But it’s not the problem. Indeed, the fiscal challenge for the payers would be much worse if these expensive drugs resulted in very prolonged survival. The real problem is that some of the stuff that works really well in healthcare is just really expensive, you see, because a lot of expensive research and technology went into developing and producing it. It just costs a lot.

So when some expert comes along and tells us that achieving a cost savings resulting from some brilliant new initiative - such as pay for performance, disease management, medical home, etc., etc. - will necessarily and directly yield an improved quality of care from that same initiative, we can immediately dismiss him or her as being either disgracefully ignorant of his or her chosen field of study, or disgustingly deceitful. In DrRich’s experience, the odds of any particular policy expert being disgraceful vs. disgusting is roughly 50-50.

* He does, however, pretend to have a transparent and equitable process for getting to a reasonable answer, which can be found in his book.

Posted in General Rationing Issues | 11 Comments »

Why the Colette Mills Dilemma Won’t Happen Here

February 20th, 2008 by DrRich

The January 27 issue of the Sunday Times of London tells the tragic story of Colette Mills, a 58 year-old British woman who lost her battle with the National Health Service (NHS), and as a consequence appears doomed to lose her battle with breast cancer.

After her initial treatment for breast cancer, Ms. Mills was placed on the drug Taxol to reduce the odds of cancer recurrence. The NHS paid for both the surgery and the Taxol. However, Ms. Mills also wanted to take the drug Avastin, which, clinical trials have shown, can reduce the chance of recurrent cancer by about 50% when it is taken in addition to Taxol. Ms. Mills, aware that the NHS will not pay for Avastin, wanted to pay for the drug herself, and asked the NHS for permission to do so. The NHS said no. Ms. Mills appealed. Unfortunately, four months into the appeal process her cancer returned and has spread to other parts of her body, making her appeal for permission to pay for Avastin moot. Her prognosis now appears grim.

According to Sarah-Kate Templeton, Health Editor of the Times, Ms. Mills is “the victim of a ruling which states that any patient who wants to pay for additional drugs not prescribed by the NHS should lose their entitlement to their basic NHS cancer care and pay for all their treatment.”

The British Department of Health holds firm to the idea that individuals paying for supplemental treatment “would ‘undermine’ the ‘fundamental principle of the NHS, now supported by all the main political parties, that treatment should be free at the point of need.” That is, you get the healthcare the government says you get, and no more, even if you’re willing to pay for it yourself.

Since the British system is often held up as an example of one we in the U.S. should emulate, we ought to ask, “Will a universal American healthcare system also prohibit individuals from purchasing their own supplemental healthcare?”

This is a question that proponents of universal healthcare, at least those proponents running for political office, assiduously avoid. But the answer to this question is almost certainly, yes. Judging from the original Clinton healthcare plan in the early 1990s, from the actions of the federal government since that time to restrict the ability of individual Medicare patients to pay for “extra” care themselves, and from more recent actions aimed at outlawing retainer practices, it is pretty clearly the (unstated) aim of the Wonkonians to ultimately prevent individuals from supplementing their government-provided universal healthcare with their own resources. One size will have to fit all.

Indeed, this very issue (whether people are to be permitted to spend their own money protecting their own health) is likely to shape up as the central battle in American healthcare reform. By DrRich’s estimate, the very reason none of today’s prominent Wonkonians are talking about a straightforward government takeover of healthcare (favoring instead a more meandering course to that end), is that they don’t think they can win the “individual autonomy” battle right now. Americans, they judge, still need 5 or 10 years of softening up. But we’re getting there. After a few more enervating years dealing with our current healthcare mess, both the Gekkonian health insurance industry and the average American will be ready to throw in the towel, and accept whatever terms the Wonkonians care to offer.

Even then, lingering notions of individual autonomy might still threaten to make things occasionally uncomfortable for government officials. But not to worry. DrRich is here to reassure nervous Wonkonian bureaucrats. After their constituents have finally drunk the government-healthcare KoolAid, American Wonkonians won’t face kind of nasty dilemma now confronting honest British bureaucrats because of disruptive patients like Ms. Mills.

The reason is straightforward.

Fundamentally, the problem imposed on the NHS by Ms. Mills was one of medical progress. As reported in the London Daily Mail, medical “specialists fear that the NHS will be ‘crippled’ by the increasing range of breakthrough treatments.” (When the chief concern of the healthcare system is controlling costs rather than optimizing healthcare, breakthrough treatments are revealed as the true threats they are.)

The good news is that once American healthcare goes to a British (or Canadian) model, the world’s great engine of medical progress (i.e., the profit-driven American healthcare system) will grind to a screeching halt. With the American profit motive out of the way there won’t be any more new therapies which the Ms. Mills of the world can selfishly demand the right to purchase. Happily, American officials will be spared the kind of regrettable discomfitures now plaguing their British counterparts. The entire problem (whose extent is sadly illustrated by some of the headlines - e.g., “Sentenced to Death By Idiocy” - to which well-meaning British bureaucrats are now being subjected), will simply disappear.

So, not to worry. It won’t happen here.

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