Cancer Action Network SM The Costs of Cancer 2020 Edition Cancer Action Network SM The American Cancer Society Cancer Action NetworkSM (ACS CAN) is making cancer—and the affordability of cancer care—a top priority for public officials and candidates at the federal, state and local levels. ACS CAN is the American Cancer Society’s nonprofit, nonpartisan advocacy affiliate. ACS CAN empowers advocates across the country to make their voices heard and influence evidence-based public policy change, as well as legislative and regulatory solutions that will reduce the cancer burden. This ACS CAN report focuses specifically on the costs of cancer borne by patients in active cancer treatment as well as cancer survivors. It examines the factors contributing to the cost of cancer care, the types of direct costs patients face and the indirect costs associated with cancer. To more fully illustrate what people with cancer actually pay for care, the report also presents scenario models for several types of cancer and different types of insurance coverage. Finally, the report presents public policy recommendations for making cancer treatments more affordable for patients, survivors and the health care system as a whole. Published October 2020 For more information regarding the methodology of the modeled patient cost scenarios in this report, and to view additional materials related to this report, please visit www.fightcancer.org/costsofcancer. This report was supported in part by grants from the Association for Accessible Medicines and its Biosimilars Council, AbbVie, the Biotechnology Innovation Organization, Boehringer Ingelheim, Foundation Medicine, Janssen, Merck, Mylan, Pfizer, Sandoz and Sanofi. 2 American Cancer Society Cancer Action Network The Costs of Cancer 2020 Introduction The American Cancer Society (ACS) estimates that roughly 1.8 million new cases of cancer will be diagnosed in the U.S. in 2020 and that more than 16.9 million Americans living today have a cancer history.1 As a leading cause of death and disease in the U.S., not only does cancer take an enormous toll on the health of patients and survivors—it also has a tremendous financial impact. Patient Costs are Unaffordable Everyone Pays the Costs of For patients and their families, the costs Cancer Treatment associated with direct cancer care are staggering. Patient Out-of-Pocket In 2018 cancer patients in the U.S. paid $5.6 Costs = $5.6 billion 2 billion out of pocket for cancer treatments, Medicaid 5% including surgical procedures, radiation 10% 4% Other treatments and chemotherapy drugs. Overall Cancer Costs are Rising Cancer also represents a significant portion of total U.S. health care spending. Approximately $183 billion was spent in the U.S. on cancer- 33% related health care in 2015, and this amount is Medicare projected to grow to $246 billion by 2030—an increase of 34%. 49% Private These high costs are paid by people with Insurance cancer and their families, employers, insurance companies and taxpayer-funded public programs Source: Data retrieved from the Agency for Healthcare Research and Quality. Medical Expenditure Panel Survey, 2018. https://meps.ahrq.gov/mepsweb/ like Medicare and Medicaid. *See reference for category definitions.3 Percentages in chart have been rounded. National Cancer Costs Projected to Increase Drastically by 2030 $ 250 B 34% increase $245.6B $ 200 B $222.2B $200.7B $182.6B $ 150 B $ 100 B $ 50 B $ 0 B 2015 2020 2025 2030 Spending on Cancer Care—in 2019 billions of dollars Source: Mariotto AB, Enewold L, Zhao J, Zeruto CA, Yabroff KR. Medical Care Costs Associated with Cancer Survivorship in the United States. Cancer Epidemiol Biomarkers Prev June 10 2020 DOI: 10.1158/1055-9965.EPI-19-1534 American Cancer Society Cancer Action Network The Costs of Cancer 2020 3 The Costs of Cancer Do Not Impact The Costs of Cancer Disparities All Patients Equally Cancer and its costs do not impact all Because of high costs, many people with cancer individuals equally. Look for information about and those who have survived cancer experience The Costs of Cancer Disparities throughout financial hardship, including problems paying bills, this report. depletion of savings, delaying or skipping needed medical care, and potential bankruptcy. These costs and hardships do not impact all cancer patients equally—there are certain factors that make a patient more likely to experience financial hardship: Cancer patients are more likely to experience financial hardship if they are: Younger People of Color 70% 70% 60% 60% 63.5% 58.9% 50% 50% 50.9% 48.5% 40% 40% 30% 30% 20% 20% 10% 10% 0% 0% Ages 18-54 Ages 55-64 Other Races/ Non-Hispanic Whites Ethnicities Less Educated Lower Income 70% 70% 69.5% 60% 60% 60.0% 60.5% 50% 50% 52.1% 51.8% 40% 40% 47.2% 30% 30% 20% 20% 10% 10% 0% 0% Less than high High school Some college or Low-income Middle-income High-income school graduate graduate more (≤138% FPL) (139-400%FPL) (>400% FPL) % of Individuals with a History of Cancer Reporting at least 1 Ty pe of Financial Hardship, Ages 18-64 *FPL = Federal Poverty Level Source: Han X, Zhao J, Zheng Z, de Moor JS, Virgo KS, Yabroff KR. Medical Financial Hardship Intensity and Financial Sacrifice Associated with Cancer in the United States. Cancer Epidemiol Biomarkers Prev. 2020;29(2):308-317. doi:10.1158/1055-9965.EPI-19-0460 Note that similar patterns of disparities exist in the over-65 population. 4 American Cancer Society Cancer Action Network The Costs of Cancer 2020 Factors Contributing to the Costs of Cancer With more than 200 different types of cancer, there is no “one size fits all” cancer treatment—and therefore the costs of cancer treatment vary significantly from patient to patient. However, there are several consistent factors that contribute to patients’ overall costs for their care. Insurance Status/Type of Insurance Coverage: Survivor Views: The Costs of Cancer in Patients without health insurance are responsible Their Own Words for all of their treatment costs. Some uninsured “I had good insurance through my husband’s patients may qualify for “charity care,” may be able work, but our deductibles were always to participate in drug discount programs to reduce high. We met our deductible twice with my their costs or may be able to negotiate discounts cancers, we have never met it otherwise. with providers. For patients with insurance, the The benefits after meeting the deductible kind of health insurance the patient has and were nice, but we had to put all of our bills the design of their plan are some of the most on payment plans and most would go into important factors in determining the ultimate costs collections even though we were paying for patients. Patient costs are often referred to them. When you are paying 8 different bills as cost sharing or an out-of-pocket requirement. for thousands of dollars, and one person is Following are some of the out-of-pocket working with the cost of living and food, there is little to go around.” components that determine what patients pay: Ovarian Cancer Survivor, Ohio ■ Premium: The monthly amount the patient pays to stay covered by the insurance plan (in plans with a deductible of $1,400 or higher some cases an employer pays all or part of a for individuals or $2,800 for families—are patient’s premiums). Premiums are determined becoming more prevalent in the U.S.4 by a number of factors that differ depending ■ Co-payment or Co-pay: A flat fee patients on type of insurance and can include: age of pay per health care service, procedure or the enrollee, where the enrollee lives, how prescription. generous the benefits are (including cost- sharing amounts listed below) and how much ■ Co-insurance: A percentage patients pay the plan anticipates it will pay in health care of the total cost of a prescription, service or claims for enrollees. While many enrollees focus procedure. Co-insurance can be unpredictable only on premium prices, the other out-of-pocket because the patient often cannot determine the costs listed below offer a total cost of the treatment until arriving at the Current law requires many private more complete picture of pharmacy or receiving a bill after the treatment. what patients ultimately pay. ■ Out-of-Pocket Maximum or Out-of-Pocket insurance plans to limit annual patient For instance, enrollees who Cap: The limit on what a patient must pay each are high utilizers of care— year before the health plan starts to pay 100% out-of-pocket spending. The 2020 limit including those with cancer— for covered, in-network benefits. This amount is $8,150 for an individual plan and often face a trade-off of excludes premiums. Current law establishes higher premiums for lower these caps in most private insurance plans. $16,300 for a family plan. out-of-pocket costs and vice Caps provide a crucial protection to patients versa. with high health care costs. ■ Deductible: The amount the patient must first ■ In-Network vs. Out-of-Network: Many health pay out of pocket for care before the insurance insurance plans have “networks” of doctors, plan will start covering costs. Some plans have hospitals, and pharmacies. If a patient goes to separate deductibles for medical services, an “in-network” provider, cost sharing is usually drugs, and/or out-of-network services. High lower because the insurer has negotiated deductible health plans—defined in 2020 as rates with the provider. Some insurance plans American Cancer Society Cancer Action Network The Costs of Cancer 2020 5 charge more cost sharing for “out-of-network” Other factors contributing to providers, while other plans do not cover out-of- network providers at all.