In these tough times, among our other economic problems, there has been the beginning of a national discussion about healthcare. Since I’m now a “heavy user” of healthcare, I thought I’d share some prices with you and some thoughts about them. Here’s the skinny on what cancer has cost over the (almost) six months since my diagnosis:
My surgery was laparoscopic (less invasive and leaves a smaller and more beautiful scar), and included 5 days and 4 nights in the hospital (all meals and recreation included). It cost about $40,000. That’s a “top line” number – meaning that’s what the hospital and all the various doctors and tests originally charged. The insurance company rarely pays this amount, usually taking a bit of a haircut. In fact, one bill, included in the number, was incredibly reduced. It was for the insertion of a stent and was billed at $3,000. The insurance company paid about $200! But in most instances, the insurer paid a much larger percentage of the bill.
My chemo and all the associated doctor visits, blood work, scans, etc that come with the treatment plan has cost about $145,000 so far. In addition, I’ve had two separate nights in the Morristown emergency room. The first cost just shy of $5,000. I haven’t gotten the bill for the second, but it will probably come in about the same since I got scanned both times. I have one chemo treatment left before hitting the 6 month mark, which will cost about $6,600, so my 6 month total of chemo plus the ER visits will come in at a little over $160,000! Incredible….
So, why is chemo so expensive? The core treatment for my cancer is the drugs 5FU and leucovorin (which is basically a vitamin). Combined, these meds cost $84 per treatment. Bear in mind that 5FU was invented in the late 1950’s, is very widely used, and is (no doubt) out of patent protection. Oxaliplatin, which I took for the first 6 treatments, is a “new” drug. I’m not sure when it came out but it was within the last 10 years or so. It cost $6,000 per dose. My additional drug (on top of the 5FU/Leucovorin/Oxi protocol, which is known as FOLFOX) is Avastin. Avastin is also a “new” drug and costs $4,300 per dose (and gave me a fissure!) Clearly something is amiss with the economics of the pharma industry when these new drugs cost so much. I understand that they need to recoup the R&D but these prices are incredible!
I also wonder what the “true” cost of the doctors, scans, pathologists, etc is. It seems that they all inflate their costs because they know the insurer is going to only pay a certain amount and they want to make sure their “ask” is higher than the limit. What would they charge if this system didn’t exist?
Now here’s the public policy part – from what I have read, there are about 150,000 cases of colon cancer diagnosed every year and 50,000 deaths. Many of the diagnosed are in lower stages of progression and likely only have 3 months of chemo after surgery. If $40,000 is an average surgery cost and six FOLFOX treatments ensue (at about $14,000 per), then these folks’ treatment plan cost about $125,000. For higher level patients, like me, who will be on chemo for at least 9 months, then the first year of treatment plus surgery comes in at about $200,000. Assuming 50/50 lower and higher need patients, the average first year cost about $160,000. Multiply that by 100,000 (net new cases), and the total cost is $16 Billion! Cut that by perhaps 25% for what the insurers actually pay and you still get $12 BILLION! Per Year! And that doesn’t count treatment beyond the first year or for those who pass away! Now, if colon cancer was a Wall Street firm, perhaps we could get a bailout…but there are plenty of other types of cancer to pay for!
So, the messages of the day are – 1) Thank God for health insurance and 2) What do all those folks do who have no coverage? Do they refuse treatment? Do they get treatment and not pay?
This is why insurance matters…
My surgery was laparoscopic (less invasive and leaves a smaller and more beautiful scar), and included 5 days and 4 nights in the hospital (all meals and recreation included). It cost about $40,000. That’s a “top line” number – meaning that’s what the hospital and all the various doctors and tests originally charged. The insurance company rarely pays this amount, usually taking a bit of a haircut. In fact, one bill, included in the number, was incredibly reduced. It was for the insertion of a stent and was billed at $3,000. The insurance company paid about $200! But in most instances, the insurer paid a much larger percentage of the bill.
My chemo and all the associated doctor visits, blood work, scans, etc that come with the treatment plan has cost about $145,000 so far. In addition, I’ve had two separate nights in the Morristown emergency room. The first cost just shy of $5,000. I haven’t gotten the bill for the second, but it will probably come in about the same since I got scanned both times. I have one chemo treatment left before hitting the 6 month mark, which will cost about $6,600, so my 6 month total of chemo plus the ER visits will come in at a little over $160,000! Incredible….
So, why is chemo so expensive? The core treatment for my cancer is the drugs 5FU and leucovorin (which is basically a vitamin). Combined, these meds cost $84 per treatment. Bear in mind that 5FU was invented in the late 1950’s, is very widely used, and is (no doubt) out of patent protection. Oxaliplatin, which I took for the first 6 treatments, is a “new” drug. I’m not sure when it came out but it was within the last 10 years or so. It cost $6,000 per dose. My additional drug (on top of the 5FU/Leucovorin/Oxi protocol, which is known as FOLFOX) is Avastin. Avastin is also a “new” drug and costs $4,300 per dose (and gave me a fissure!) Clearly something is amiss with the economics of the pharma industry when these new drugs cost so much. I understand that they need to recoup the R&D but these prices are incredible!
I also wonder what the “true” cost of the doctors, scans, pathologists, etc is. It seems that they all inflate their costs because they know the insurer is going to only pay a certain amount and they want to make sure their “ask” is higher than the limit. What would they charge if this system didn’t exist?
Now here’s the public policy part – from what I have read, there are about 150,000 cases of colon cancer diagnosed every year and 50,000 deaths. Many of the diagnosed are in lower stages of progression and likely only have 3 months of chemo after surgery. If $40,000 is an average surgery cost and six FOLFOX treatments ensue (at about $14,000 per), then these folks’ treatment plan cost about $125,000. For higher level patients, like me, who will be on chemo for at least 9 months, then the first year of treatment plus surgery comes in at about $200,000. Assuming 50/50 lower and higher need patients, the average first year cost about $160,000. Multiply that by 100,000 (net new cases), and the total cost is $16 Billion! Cut that by perhaps 25% for what the insurers actually pay and you still get $12 BILLION! Per Year! And that doesn’t count treatment beyond the first year or for those who pass away! Now, if colon cancer was a Wall Street firm, perhaps we could get a bailout…but there are plenty of other types of cancer to pay for!
So, the messages of the day are – 1) Thank God for health insurance and 2) What do all those folks do who have no coverage? Do they refuse treatment? Do they get treatment and not pay?
This is why insurance matters…
