New Cancer Patients With a High-Deductible Insurance Plan Face Sharp Rise in Out-of-Pocket Costs

By Linda Carroll

December 28, 2021

NEW YORK (Reuters Health) - People who chose a high-deductible insurance plan and then develop cancer can be hit with big increases in out-of-pocket costs, a new study suggests.

An analysis of data from more than 134,000 patients with a new diagnosis of breast, colorectal, lung or other cancer between 2008 and 2018 revealed that those with high-deductible plans could incur more than $1,600 in additional out-of-pocket costs, researchers report in JAMA Network Open.

The study has two main implications: "If costs of care are unmanageable, people with cancer may not get the minimum care they need - or they may omit care altogether," said coauthor Dr. Arden Morris of Stanford University School of Medicine in Stanford, California. "And when they adhere to all recommended treatment, patients and their families may deal with the financial repercussions for years afterwards."

Among those with traditional health insurance plans, "a new diagnosis of cancer can be financially devastating," Dr. Morris told Reuters Health by email. "These are not trivial amounts — 40% of U.S. adults would not be able to pay an unexpected expense of $400 without selling possessions or borrowing money."

To take a closer look at the financial impact of a new diagnosis of cancer, Dr. Morris and her team performed a cohort study using the Clinformatics Data Mart Database (OptumInsight), a statistically deidentified database of administrative health claims for members of a large national managed-care company. The data set comprises information from more than 62 million beneficiaries with commercial or Medicare Advantage health plans from 2003 to 2020.

The researchers focused on 137,294 patients from the database with a diagnosis of breast, colorectal, lung or other types of cancer along with more than 1.9 million individuals without cancer who served as controls. After propensity-score matching, they were left with 134,826 pairs of cancer patients and controls.

Among the cancer cohort, 48% were enrolled in a high-deductible health plan (HDHP), while 44% in the control group were in a HDHP. Out-of-pocket costs started rising in the cancer cohort one to two months prior to diagnosis, peaked in the month of diagnosis and decreased to baseline more than two to three months after diagnosis.

Just how much the yearly out-of-pocket costs rose depended on the type of cancer. Based on a triple difference-in-differences analysis, compared with patients without cancer enrolled in HDHPs, those with breast cancer paid $1,683 in additional yearly out-of-pocket costs, those with colorectal cancer paid $1,420 more, those with lung cancer paid $467 and those with other types of cancer paid $551 more.

"We need to restructure U.S. health coverage to include serious unexpected events without financially devastating normal people, who choose health insurance plans based on a combination of what they can afford and what they expect to need," Dr. Morris said. "Cancer is an unexpected and life threatening condition that often requires extensive care — and even those with insurance must pay a certain amount out of pocket for their treatment."

This is a very straightforward study, said Dr. Ge Bai, a professor of accounting at the Johns Hopkins Carrey Business School and a professor of health policy and management at the Johns Hopkins Bloomberg School of Public Health, in Baltimore, Maryland.

"Many patients don't expect the trade off when they sign on for a high-deductible plan," Dr. Bai told Reuters Health by phone. "They don't realize how high the out-of-pocket costs can be."

These high-deductible policies aren't going away any time soon, Dr. Bai added. And if the government tries to get rid of high-deductible plans, there will be "pushback from employers" who are paying for the insurance, she said.

"People are working hard to make access to healthcare more equitable, but healthcare equity without income equity is extremely challenging to achieve," Dr. Bai said.

SOURCE: https://bit.ly/3FrZMdo JAMA Network Open, online December 23, 2021.

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