How Should We Intervene on the Financial Toxicity of Cancer Care?

Jul 14, 2017

This issue’s “Current Controversies in Oncology” is excerpted from the 2017 ASCO Educational Book, an NLM-indexed collection of articles written by ASCO Annual Meeting faculty and invited leaders from ASCO’s meetings. Published annually, each volume of the ASCO Educational Book highlights the most compelling research and developments across the multidisciplinary fields of oncology.

By S. Yousuf Zafar, MD, MHS, Lee N. Newcomer, MD, MHA, Justin McCarthy, JD, Shelley Fuld Nasso, and Leonard B. Saltz, MD

Cancer is one of the most expensive diseases to treat in the United States. The median price of a month of chemotherapy has increased by an order of magnitude during the past 20 years, far exceeding inflation over the same period. Some would maintain that prescribing patterns further contribute to higher costs. In the most common models of cancer care delivery, oncologists have little incentive to contain treatment costs when they prescribe chemotherapy, and only recently have considerations of cost and affordability begun to be openly incorporated into guideline development.

Because of increasing deductibles, increasing premiums, cost sharing, coinsurance, and frequent copayments, patients are directly shouldering a greater portion of those costs.1 One in three American families face health care bills they cannot afford, and 50% of elderly Americans with cancer pay at least 10% of their income toward out-of-pocket treatment-related expenses.2,3 A growing body of literature has described the treatment-related financial strain experienced by patients with cancer, often called the financial toxicity of cancer treatment. These studies have described how an increasing portion of patients with cancer are at risk for cutting back on groceries, selling their homes, being nonadherent to their prescribed treatment, or—in the most extreme cases—declaring personal bankruptcy to pay for their cancer treatments.4,5

What can we do to intervene on treatment-related financial toxicity of patients? Without question, any meaningful steps toward lower costs will involve collaboration among the pharmaceutical industry, insurance providers (government and otherwise), oncologists, and patients; no one party can single-handedly solve the problem….

The authors of this article have each been asked to respond with a practical answer to the provocative hypothetical question, “If you could propose one thing, and one thing only, in terms of an action or change by the constituency you represent in this discussion, what would that be?” …We aim here to provide ideas to serve as starting points, both for introspection and to promote discussion.

Mr. McCarthy, pharmaceutical industry perspective: Invest additional resources to identify patient populations most likely to benefit from therapy

The idea of paying for value when it comes to pharmaceuticals is a widely accepted goal. However, there is still no consensus on what this means. Although this concept is still evolving, it relies at its core on biopharmaceutical companies to demonstrate that the products we develop provide meaningful benefits to patient populations, coupled with a reimbursement system that lowers barriers to high-value products. Biopharmaceutical companies should do their part to invest more resources to ensure that the right product is available to the right patient at the right time.

Cancer care is in the midst of an incredible transformation. Many cancers, previously intractable, now can be treated with targeted therapies that greatly boost the chances of better outcomes for patients. Some patients experience long-term benefits from immunotherapies. However, we still know too little about which types of patients are likely to respond best to a particular therapy. The pharmaceutical industry should invest additional resources in studies of a new drug after it has been approved to better understand its utility, whether to identify use at earlier stage of the disease, in a different tumor type, or for an even narrower patient population to avoid patient exposure when the risks are more likely to outweigh the benefits.

For our health care system to truly pay for value, stakeholders also must be willing to develop creative reimbursement mechanisms that incentivize high-value care. Payment reform demonstrations are underway across the health care sector to explore better ways to pay for inpatient and outpatient care. To date, however, little has been done in the prescription drug space. Biopharmaceutical companies and payers—public and private—should collaborate to explore new, high-value reimbursement methods. These methods could include the following:

Outcomes-based contracts. Biopharmaceutical companies and private payers have experimented recently with contracts in which payment for products is tied to achievement of certain therapeutic goals (e.g., avoiding increased hospitalizations or increasing progression-free survival). These two sectors should work together to advocate removal of regulatory and legal barriers. Doing so would allow robust use of these promising tools to expressly tie payment to value.

Value-based insurance design. Another nascent concept is value-based insurance design. Although this idea has been used in the context of outpatient and inpatient services, it has not been applied broadly to drugs. For example, an insurer could dramatically reduce cost sharing for high-value drugs or lower cost sharing after a patient experiences disease failure with a lower-cost medication.6 These types of arrangements are still in their infancy but could help incentivize patients and providers to use and prescribe high-value products.

Transformation of our health care system to one that pays on the basis of value, not volume, will require coordination and cooperation across the sector. Biopharmaceutical companies should do their part to help demonstrate the value of our products to patients, payers, and providers.

Dr. Newcomer, payer perspective: Remove coverage mandates from state and federal insurance law

Insurance regulation forces payers to pay for any U.S. Food and Drug Administration (FDA)–approved cancer therapy in 42 states; Medicare has a similar provision. Such mandatory coverage eliminates any consideration of value. A therapy with mandatory coverage could be curative or could simply add 1 additional day of life, but the price cannot be negotiated if that therapy has an FDA-approved indication. The laws were well intended originally. As expensive therapies emerged, legislators were concerned that insurers would simply refuse to pay. The unintended consequence of coverage mandates becomes apparent when multiple therapies are available; payers cannot make decisions on the basis of the value of therapy and substitute one therapy for another when it is clinically appropriate. Removal of this legislated requirement would open the marketplace, and pharmaceutical manufacturers would compete on price and outcomes. Payers would compete in the marketplace by offering the best values for therapy within a competitive premium. This competition requires that a transparent and understandable set of criteria for determination of value, partial value, or no value is presented. The market could function normally.

The lung cancer therapy necitumumab is an excellent example of why mandates force prices beyond reason.7 This drug was added to cisplatin and gemcitabine and compared with cisplatin and gemcitabine alone in patients with stage IV squamous cell lung cancer. Three percent of the patients who received necitumumab suffered a cardiac arrest. The difference in median progression-free survival was 0.2 months (5.7 vs. 5.5 months), but the overall survival favored the necitumumab group by 1.6 months (11.5 vs. 9.9 months). These results are so meager that the National Comprehensive Cancer Network assigned a category-3 recommendation to the drug—an endorsement that most insurers, including Medicare, do not cover. However, the mandates require coverage at any price, because the drug has an FDA approval. The manufacturer priced this drug at $11,430 per month. The competing regimen, cisplatin and gemcitabine, costs less than $1,000 per month. It is difficult to believe that anyone except the manufacturer would consider this to be a value, but it does not matter. The law mandates coverage; therefore, price is not negotiable.

Necitumumab is not an isolated example. Salas-Vega et al8 reviewed 62 new cancer molecules approved between 2003 and 2013 in the United States and Europe. The review showed no evidence to suggest that 16 of those drugs (30%) increased overall survival compared with best alternative treatments. If manufacturers knew that these products would not be reimbursed in the market, they would focus their attention on different molecules that offer better results.

Other mandates are emerging. Several states are now considering laws to prohibit step therapy for cancer. Step therapy requires treatment with a preferred regimen before the patient is eligible for a second therapy. This strategy is useful for drugs that have similar clinical response rates, because a payer can obtain competitive bids and then give preference to the lowest-cost regimen. There have been so many drug discoveries in the past decade that many cancer types now have multiple effective agents. Step therapy allows patients to obtain treatment at a lower cost. Prohibition of step therapy eliminates competition, raises costs, and hurts everyone except the pharmaceutical manufacturer.

A free market determines prices on the basis of merit, and mandates prevent free market actions. Removal of mandates presents a win-win proposition for patients and payers.

Dr. Saltz, oncologist perspective: Know the price

Any one change that doctors could make would only be a first step toward the ultimate goal of provision of lower-cost, higher-value medicines for our patients. To me, that first step would be physician acceptance, practice, and promotion of transparency in price. In simple terms, that means knowing the prices of the drugs prescribed, considering those prices as one of the many factors in decision making, and discussing the prices of the prescribed drugs as openly as we discuss other risks, toxicities, and benefits.

I make a sharp distinction here between the words price and value. A true, constructive consideration of the value of a particular medicine cannot realistically occur unless we know the amount of money that we are being asked to pay for it. That is the definition of price, or cost, that I refer to for this discussion: the amount of money that will be paid for the drug. I am not, for this exercise, getting into who is paying for it, what other costs are or are not involved, what alternatives are available, or any other of a number of important, arguably relevant considerations, and I am not making a judgment about whether the price is too high, too low, or just right. I am simply saying that we must stop putting our heads in the sand and pretending that we do not need to know, think about, or talk freely about the price.

Consider for a moment the inherent ambiguity in the word value. Value can be used as a noun or a verb. The way to define it in a constructive discussion aimed at definitions of high- and low-value care is as a noun; in that respect, the value of a drug would be defined by a ratio of objective positives and negatives of that drug, with price as one of the negatives. Note that price and value move in opposite directions. For any drug with a fixed degree of benefits and adverse effects, the higher the price, the lower the value, and the lower the price, the higher the value. So, we cannot begin to meaningfully determine the value until we know the price, just as we could not meaningfully determine value without knowing the other positive and negative aspects of the drug. Price is not the defining factor in value, but it is one of the components without which the value cannot be defined.

Too often, our consideration of price can be distracted by the shift of the discussion to value and its definition as a verb; we value a response, a defined amount of extended life, or relief from a symptom. The verb definition of value necessarily takes us into subjective, as opposed to objective, criteria, and the very nature of these resist correlation with a price. In fact, such a focus prevents delineation of value and distracts us from a meaningful and constructive discussion of what is high-value care and, just as important, what is not.

Doctors do not have the ability to unilaterally lower the prices of drugs. Doctors do have the ability to be aware of the prices of the drugs, tests, treatments, and recommendations we offer, both directly in terms of out-of-pocket expenses to our patients and more indirectly to society as a whole. Some have argued that it is only the immediate out-of-pocket expense of the individual that should be considered by doctors and that societal costs are not relevant to a patient-physician relationship. I respectfully disagree. Societal costs ultimately are distributed across the population, and all insured patients eventually bear these costs in terms of increased insurance premiums. The price of insurance and the percentage of paychecks that go toward health care costs have been increasing at a substantially more rapid rate than the increases in average worker wages or inflation. The term financial toxicity has gained increasing traction in our understanding of what these costs are doing to our patients on a regular basis. Even when the initial out-of-pocket expense may appear small, one can realistically expect that these costs will appear in the insurance premiums for all in the years to come.

Even if one were to take the position that the physician focus should be on immediate out-of-pocket expenses of an individual patient (a short-sighted view, as I outlined in the previous paragraph), this would imply a responsibility to understand the coverage and actual out-of-pocket exposure of each patient, as well as, arguably, the ability of each patient to manage those expenses. This often may be beyond provider abilities. It is quite reasonable, however, to assume that vulnerability a patient may have toward the potential cost of even a small part of that therapy increases with more expensive therapy. Physicians see a decrease in simple copayments with fixed nominal costs and an increase in coinsurance charges, whereby the patient will pay a fixed percentage of the price of the drug. In this context, the more expensive drugs create greater out-of-pocket expenses at the same time that they contribute to the aggregate cost of health care and the necessarily compensatory increases in insurance premiums going forward.

Physicians frequently talk to patients about intimate and personal details of their lives. Physicians routinely ask about bowel function, bladder function, sexual function, anxiety, depression, alcohol and illicit drug use, and other intimate and personal details that would be far outside normal social discourse. Within this context, there is a startling inconsistency with any conversational taboo regarding costs. Yet, discussion of the prices of treatments has been a taboo in our doctor-patient relationships, and that requires re-evaluation. Bringing the realistic costs to bear in discussions would make the most involved members of society appropriately informed of the magnitude of the challenges faced in paying for drugs at the current prices. It would also facilitate rational discussions of efforts to use more cost-efficient regimens, use less expensive alternatives, or perhaps forego extremely expensive and toxic options that have little chance to provide meaningful benefit. There are very few things in life that people buy without an awareness of the purchase price. Such an awareness helps people make informed decisions about what goods or services they do or do not wish to purchase and can encourage people to make informed decisions about the consideration of alternatives.

From an academic perspective, discussion of price is warranted both in clinical trial design and in publications. When a trial is designed that increases the length of treatment or increases the dose of a drug to higher than the standard dose, physicians must know and consider what the costs of those changes will be. When a report is published about a regimen for which the prices of the drugs are known, those prices constitute a nontrivial toxicity to which patients will be exposed.

The purpose of academic papers about therapeutic options, and the purpose of open and complete discussions between patients and providers, is to maximize the awareness of the true risks, benefits, and alternatives of the treatment strategy under consideration. It would be wrong to exclude consideration of physical toxicities. It is equally counterproductive to exclude consideration of price, or financial toxicity. The inability to provide full awareness of either of these likely will increase, rather than decrease, the prevalence of and the harm done by these toxicities.

Ms. Fuld Nasso, patient advocate perspective: Engage in treatment planning to better reflect patient values

Patient engagement in treatment decision making can reduce financial toxicity for patients by ensuring that treatments truly match the needs, values, and preferences of patients. A consideration of all clinically meaningful treatment options and their benefits, risks, and out-of-pocket costs should frame the patient decision-making process.

At an individual level, patients can play a role by being active participants in decisions about their care, researching their insurance coverage, initiating discussions about the cost of care with their care team, advocating for coverage of the care that they need, and seeking financial assistance from foundations and company-sponsored assistance programs. Empowered patients and family members know that they must advocate on their own behalf, or on behalf of their loved ones, in all aspects of their care, including financial considerations. Of course, not all patients are prepared and knowledgeable about health insurance, and many patients feel overwhelmed by the amount of information they must process about their diagnosis and treatment options, not to mention the question of how they will pay for their care. Patients need assistance with health insurance literacy; there is evidence
that patients do not have a thorough understanding of key insurance constructs, like deductibles, copayments, and coinsurance.9

Ideally, patients and caregivers will raise the topic, ask the questions, and seek assistance from their care team and/or a financial counselor. However, a huge barrier for patients is embarrassment about discussions of financial considerations with their care team. It is essential that providers create a welcoming and open environment for patients to express their concerns. Providers should recognize how difficult it is for patients to raise the topic and should open the door to the conversation by asking a question as simple as “Do you have concerns about the cost of your treatment?”

At a practice and policy level, the comprehensive treatment planning process that has been defined by the Institute of Medicine10—a definition arrived at with substantial input from oncologists and patients—should be the standard for doctor-patient communication about cancer care. It is important to note that this planning is not about checking a box that a piece of paper was handed to a patient; it is about truly engaging patients in decision making about their care. This plan should include information related to diagnosis, prognosis, treatment goals, expected response to treatment, treatment benefits and harms, out-of-pocket cost of care, and a plan for meeting psychosocial needs. The care planning process also should include consideration of advance care planning and advance directives and should lead to the development of a survivorship plan after treatment. This cancer care planning process should produce a patient-specific care plan that will guide treatment decisions and facilitate care coordination, including effective symptom management to reduce the burden and cost of adverse effects.

An important component of the planning process is a discussion of the out-of-pocket costs to a patient. We know that some patients do not wish to discuss costs; they might worry about the perception that the oncologist has of them, they might want the best treatment regardless of cost, or they might fear that a discussion of cost will result in inferior treatments.11 Yet, most patients do want to have this conversation, even if they are reluctant to bring it up. Research shows that having the discussion, even without a change in treatment, can reduce costs for patients.11

Patients are concerned about their total financial responsibility across the life of their treatment, not just the cost of one aspect of treatment. Obviously, that is difficult for one provider to share, given the multidimensional aspects of treatment. To the degree that it is possible, knowledge about the total costs will help patients plan and understand the entire picture, not just the cost of a specific drug. Although some of the value frameworks, including those by ASCO, have considered the price of a drug, the out-of-pocket cost is what is most important to an individual to make decisions. In most cases, that distinction will require an understanding of the out-of-pocket maximum. It also is important for patients to understand whether any out-of-network services, which do not contribute to the out-of-pocket maximum, will be required.


  1. Kaiser Family Foundation. 2016 Employee Health Benefits Survey. Accessed October 16, 2016.
  2. Davidoff AJ, Erten M, Shaffer T, et al. Cancer. 2013;119:1257-65.
  3. Cohen RA, Gindi RM, Kirzinger WK. Financial Burden of Medical Care. Accessed March 26, 2017.
  4. Zafar SY, Peppercorn JM, Schrag D, et al. Oncologist. 2013;18:381-90.
  5. Ramsey S, Blough D, Kirchhoff A, et al. Health Aff (Millwood). 2013;32:1143-52.
  6. Fendrick AM, Buxbaum J, Westrich K. Supporting Consumer Access to Specialty Medications Through Value-Based Insurance Design. Accessed March 8, 2017.
  7. Thatcher N, Hirsch FR, Luft AV, et al. Lancet Oncol. 2015;16:763-774.
  8. Salas-Vega S, Iliopoulos O, Mossialos E. JAMA Oncol. 2017;3:382-390.
  9. Zafar SY, Tulsky JA, Abernethy AP. Oncology (Williston Park). 2014;28:479-480.
  10. Institute of Medicine. Delivering High-Quality Cancer Care: Charting a New Course for a System in Crisis. Accessed January 9, 2014.
  11. Zafar SY, Chino F, Ubel PA, et al. Am J Manag Care. 2015;21:607-15.

The views and opinions expressed in Current Controversies in Oncology are those of the authors alone. They do not necessarily reflect the views or positions of the Editor or of the American Society of Clinical Oncology.


Daniel Morganstern, MD

Jul, 22 2017 11:16 AM

I very much appreciate Dr. Saltz's comments and his track record of promoting his position with clarity at national meetings such as ASCO.  In the same manner that Dr. Saltz cautions us about differentiating "value" from "cost" I would propose that the term "financial toxicity" obfuscates the real issue.  A "toxicity'' suggests an acute event experienced by a single individual undergoing a treatment.  There is no financial 'ondansetron" which can prevent this.


Alternatively as Dr. Saltz points out, the pricing of cancer therapeutics is an expense ultimately shouldered by all patients (and potential patients and employers) who seek health insurance.  As cost is most closely related to societal cost, or the total cost payed by all stakeholders, clinicians should not be reluctant to speak of "Societal Cost" rather than "financial toxicity" as the primary issue to debate. Phrma has cleverly positioned "copay assist" programs to quell concerns about individual cases of "financial toxicity" which do nothing to address the larger problem.


Daniel Morganstern MD

Boston MA

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