Two new research findings will be disheartening to anyone like me with hopes for meaningful reform of our medical care system. How’s this? Cut the excessive Medicare payments for chemotherapy drugs, and oncologists will just give more chemotherapy to keep their incomes from dropping.  And if that’s not bad enough, consumers came across as ill-informed in another study that showed most believed more care, as well as more costly care meant higher-quality, better care. In other words, many of us are sitting ducks for inappropriate and often dangerous medical treatment.

Let’s start with the back story for the Medicare payment/oncologists study. Office-based oncologists who administer chemotherapy are among the most highly paid specialists in the nation. They purchase their drugs directly from the pharmaceutical companies, often at deep discounts, and then bill Medicare for the drugs. There were reasons to believe that the oncologists were making large profits (their high incomes for one). For years, Medicare reformers tried to find out how much the oncologists were actually paying for the drugs, but were prevented from doing so by a law passed during the Reagan Administration. The Paperwork Reduction Act is one federal law that had the strong backing of the pharmaceutical industry.

When I first wrote about this story in the mid-1990s, I asked someone at Medicare the obvious question: If the government is expected to reimburse oncologists without knowing how much they paid for their drugs, how do you know there’s an overpayment problem?  The memorable answer: “An oncologist’s secretary made the mistake of sending us the doctor’s bill plus the invoice that showed how much he had paid for the drug. The bill to Medicare was six times the cost of the drug.” Around this time, I learned that the drug companies knew that prescribing the most expensive drugs could be increased simply by giving them the steepest discounts.

Reform finally won out—or, at least it looked that way— in 2005 when the Medicare Prescription Drug, Improvement, and Modernization Act substantially reduced payment rates for chemotherapy drugs administered on an outpatient basis. In the years leading up to this law, oncologists did all they could to stop it. They said it would harm patients who will be denied treatment that oncologists could no longer afford to prescribe.

But the opposite occurred, according to a study in the July issue of Health Affairs, a health policy journal. Mireille Jacobson, a senior health economist at the RAND Corporation, and colleagues looked specifically at Medicare beneficiaries with newly diagnosed advanced lung cancer given chemotherpay on an outpatient basis. (Keep in mind that chemotherapy is unlikely to provide a cure once lung cancer spreads to other organs, which describes all patients in this study.) The researchers found that the oncologists administered more chemotherapy than they did before the reduction in reimbursement went into effect. Another change in prescribing practices involved the choice of drugs. Oncologists switched from the chemotherpay drugs like Taxol with the deepest cuts in profitability to other high-profit margin drugs like Taxotere.

No attempt was made in this study to see how patients fared, but the authors provided this warning: “The ultimate message is that payment reforms have real consequences and should be undertaken with caution.” That’s fine for the economists and the reformers, but to me, the ultimate message for the rest of us is:  arm yourself with information when you’re not sick.

Consumers should be hopping mad about our medical care system’s built-in financial incentives for doctors to overtreat them with questionable drugs, as this study so aptly demonstrates. One would hope that the public would demand more proof that medical treatments and tests have been proven safe and effective in high-quality studies. Instead, another team of researchers found “a disconnect between the central tenets of evidence-based health care and the knowledge, values, and beliefs held by many consumers.” This was the upshot of a series of focus groups, interviews, and an online survey, published in the June issue of Health Affairs.

Worse, many consumers were hostile to the term “evidence-based medicine” which is perceived as a way to deny them needed treatment. These findings are extremely discouraging. Just as a well-functioning democracy is dependent upon an informed electorate, an efficient high-quality medical care system is dependent upon a well-informed public that participates knowledgeably in decision-making.

For more information

National Cancer Institute summarizes the latest treatments by stage for the full range of cancers. For an understanding of evidence-based medical care, read the explanations for the evidence-ranking system found in each treatment section of this website.

Read “Americans are Overtreated to Death” in USA Today.

Maryann Napoli, Center for Medical Consumers©

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