Oncology Therapy Choices Under Greater Scrutiny From Payers

The cost of oncology treatment is high and rising in the United States.

Historically, insurance companies have taken little action to manage oncology drugs and have left prescribing decisions largely up to provider preference, mostly because of the complexity and sensitivity of treating cancer. It appears, however, that the companies are beginning to indirectly manage prescribing to better manage costs.

Namely, they are shifting financial risk to providers and, in doing so, are trying to push providers to consider cost effectiveness, as well as the efficacy and safety of treatments. If providers are forced to consider cost to a greater extent, payers reason, they may begin to do more robust clinical and cost-effectiveness analyses to inform their decision-making.

The cost of oncology treatment is high and rising in the United States. For example, the monthly price of novel oncology drugs increased on average by 9% annually, and the average monthly cost of oncology drugs more than doubled between 2006 and 2015, from $7103 to $15,535.1 This raises the question whether insurance companies will begin to employ new tactics to influence provider-prescribing decisions toward lower-cost treatment options. To this end, Two Labs conducted a survey of 120 oncologists practicing in the United States to better understand the extent to which insurance companies are placing financial pressure on them and how this influences their prescribing decisions.2

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