More on Out-of-Control Prices for Cancer Drugs

I recently (http://brodyhooked.blogspot.com/2009/01/compassion-or-conflict-of-interest-new.html) posted about Medicare rules changes that will encourage more spending on cancer drugs of questionable value, by including as officially recognized "compendia" drug lists that are compiled by groups with blatant financial conflicts of interest. The New York Times editorially recognized the problem:

http://www.nytimes.com/2009/02/10/opinion/10tue2.html?_r=1

The editorial is based both on press coverage of the new Medicare rule on drug compendia for off-label use of cancer drugs, and also on an important recent policy study in the New England Journal of Medicine by Peter B. Bach of Memorial Sloan-Kettering Cancer Center in New York. Bach lists the various ways Medicare controls the costs of other drug treatments, and then proceeds to show how specific provisions in Medicare laws and regulations prevent the program from using those same means on cancer drugs. The end result is a major recent increase in the costs of cancer treatment. There have been major breakthroughs in the survival rates for a few specific tumors, a modest improvement in survival rate for other cancers, and finally the development of chemotherapy agents that have significantly reduced side effects compared to older drugs. Bach, however, is of the opinion that the increase in prices far outstrips any increase in efficacy.

The New York Times editorial suggests that the answer will be found in government programs to compare drugs head-to-head to determine their true efficacy and cost-effectiveness. Bach endorses this approach, and also pilot programs to test prospective payment mechanisms. (The latter being one more sign that policy wonks, at least, are starting to regard the much-maligned HMOs and managed care programs of the 1990s as the good old days of keeping medical costs under control while providing a generally decent level of care.)

Bach PB. Limits on Medicare's ability to control rising spending on cancer drugs. New England Journal of Medicine 360:626-633, February 5, 2009.