Insured Cancer Patients Face High Costs

Report Shows Insurance Coverage Gaps or Caps Leave Cancer Patients With High Bills

Americans diagnosed with cancer face the risk of high medical costs even though they have insurance policies, warns a new report.

The report, released by the Kaiser Family Foundation and the American Cancer Society, concludes that many patients wind up liable for high medical bills because of coverage gaps and caps on spending in their insurance policies. Those gaps may be growing as rising health care costs force insurers to put stricter limits on spending and pass more costs onto patients.

"I do think that alarm bells should ring if people with cancer -- significant numbers of people with cancer -- are having the kinds of problems that we document in this study," says Drew Altman, PhD, president of the Kaiser Family Foundation.

The report doesn't offer statistics on how many of the estimated 685,000 adults under the age of 65 diagnosed with cancer each year confront financial difficulties because of their illnesses.

Instead, it has 20 examples of insured patients who called the American Cancer Society's Health Insurance Assistance Service after confronting gaps in their coverage.

A 2006 Kaiser survey found that one in five cancer patients who had insurance throughout their illnesses still used all or most of their savings. Nearly one in 10 were contacted by collection agencies.

"The system seems to be failing most where it should be working best -- and that's for people who are sick," Altman says.

Identifying the Coverage Gaps

Seven in 10 adult cancer patients under the age of 65 have insurance coverage, the report estimates. But it identifies five main areas where coverage can fall short:

• High out-of-pocket costs and annual or lifetime spending limits can leave patients exposed to medical bills.
• Patients who become too sick to work may not be able to pay for their employer-sponsored coverage, even though there are laws that keep that coverage available.
• Cancer patients and survivors often can't find affordable coverage on the individual insurance market.
• State high-risk pools -- designed to cover patients who can't find private policies -- may exclude cancer patients or be too expensive to afford.
• Disabled patients with cancer can be exposed to high costs during the two-year waiting period to gain Medicare disability benefits.

"We know that 2 million cancer survivors in America today are forgoing health care that they need simply because that care is not covered and they can't afford it," says John Seffrin, PhD, president of the American Cancer Society.

John Rowe, MD, a professor of health policy at Columbia University and a former CEO of Aetna Inc., offered several tips to help newly diagnosed patients avoid falling into coverage gaps.

• Call the number on the back of your insurance card and discuss your diagnosis and your benefits with your insurer. "People don't do this often because they're afraid, 'if I tell them I have cancer, they're going to drop me,'" Rowe says. The practice is illegal, and the company will be able to tell you exactly what benefits you have to avoid surprises.
• Find out what doctors are in your insurance network before you make an appointment. "Don't go to a doctor who you're referred to by a friend, [then] start getting some treatment, and find out that doctor isn't in the network of your insurance company," Rowe says. Also bring your directory to your doctor to be sure any specialists or hospitals you're referred to are also in the company network.
• Understand what medications are covered. There might be two drugs that you could get, and one of them is covered and one isn't. And those might cost $100,000 each and your doctor may not know which one is covered for you, and may in fact not have a preference as to which drug you get," Rowe says.
• Ask your insurer to calculate and write down the total out-of-pocket costs, co-pays, deductibles, and premiums you'll have to pay in a year.
• Negotiate. "Everything is negotiable," Rowe says. Most hospitals and doctors are willing to negotiate costs or come up with payment plans for out-of-pocket costs. "Work with them."

"This doesn't close these gaps. What this does do is it prevents some people who don't need to fall into a gap from falling into one," Rowe says.

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