Huge increases in the cost of prescription drugs have sent shockwaves through the health care community. Now a study in the journal Cancer (Vol. 94, No. 4: 1142-1150), shows that newer, more expensive chemotherapy drugs are causing the same kind of jump in cancer treatment costs.

Although analysts have looked at drug spending for different types of cancer before, this is the first time that researchers looked at the big picture: outpatient spending for overall cancer care.

They looked at insurance claims from people in HMOs during two years, 1995 and 1998, and compared the two years. They found an average annual increase of 18% (from an average charge of $1,218 in 1995, to $2,003 per patient in 1998).

Chemotherapy costs represented 76% of the increase. Most of the drugs were given in outpatient settings, by injection.

"We did not look at the appropriateness (of what drugs were used), but we did look at the overall patterns," said lead author Ron Halbert, MD, MPH, senior consultant with Protocare Sciences in Santa Monica, Calif.

"There've been a lot of ideas that, if we can substitute generics for brand names or increase co-payments we can control costs and still have good outcomes," Halbert said. "In a lot of other areas (of medicine) that may be true.

"In this particular area, we found that the cost increases were the replacement of older (chemotherapy drugs) — the major cost driver — with newer (ones). It wasn't that the same drugs became more expensive."

For example, a first-line drug treatment for colorectal cancer called fluorouracil cost $22 per claim in 1998. An approved second-line drug, irinotecan, cost $2,080 per claim.

"There's a dramatic increase in the cost of the new drugs," said Len Lichtenfeld, MD, medical editor for the American Cancer Society (ACS). "And there's a shift by doctors to newer drugs that are substantially more expensive."

Looking at the increase in the cost of cancer drugs in this study, "you can get some idea of what must have happened between 1998 and today, as more and more patients are treated with newer drugs," Lichtenfeld said.

Both Lichtenfeld and Halbert agree that absorbing the costs is becoming increasingly difficult for insurance companies and the nation through programs such as Medicare.

"Everybody's talking about cost controls," Halbert said. "But the consumer needs to be sensitive to the idea that certain types of cost controls may impact the ability to keep your cancer from growing."

Lichtenfeld said, "We’re living in a world of limited medical resources. Someone's going to make a decision about whether there's really improvement with a treatment — and it could end up being politicians or regulators."

He recommended that consumers learn about their insurance coverage. "Be sure that you understand very clearly what your HMO contract says about paying for cancer drugs," he said.

Lichtenfeld also said it's fair for patients to ask physicians about the potential success of a new treatment and what alternate treatments may be available.

"The best treatment may not be the cheapest or the most expensive," he said. "Cost is just one component of determining the best treatment."