Cancer Care Is Growing More Expensive
Almost everyone realizes that health care is becoming more expensive, so it shouldn’t be surprising that cancer treatment is also quickly growing out of reach financially for more Americans. For the first time since 2010, the rise in health care prices outgrew general inflation. While the average price of consumer goods will rise 1.9 percent in 2018, health care prices are expected to rise 2.2 percent. In the years since the passage of the Affordable Care Act, health care costs were typically about 1.53 percent, considerably lower than the 1.93 percent annual inflation from 2001 through 2007.
However, a combination of factors is forcing health care price increases to outpace the general economy. The largest factor is the huge jump in Americans with health insurance who are trying to obtain medical care. The Affordable Care Act added more than 20 million to the insured population, and that surge in demand combined with a static supply of health care is driving this new trend in health care inflation.
Another key driver of health care inflation is a rapidly aging American society. There are 46 million Americans aged 65 or older in the U.S. currently, but this will balloon to 70 million by 2030 and 98 million by 2060, a result of the baby boom after World War II. More Americans are expected to live longer lives, but almost 60 percent of seniors are estimated to struggle with at least one chronic health condition, producing even more pressure on a beleaguered health care system.
With a rapidly aging population that is living longer, it is only logical that more cases of cancer are appearing. Almost 77 percent of cancer diagnoses are among people aged 55 and older, the fastest growing segment of our population. That inevitably means that there is surging demand for cancer treatment at a time when there are a limited number of physicians to administer treatment—the perfect formula for a jump in cancer therapy prices.
Some Eye-opening Cancer Statistics
Cancer is the leading cause of death around the world, claiming 8.8 million people in 2015 alone. Although cancer is the second leading cause of death in the U.S. (behind heart disease), it still kills almost 610,000 American lives annually. Almost 23 percent of all U.S. deaths are cancer-related.
Although slightly more than 600,000 Americans will die from cancer in 2018, this devastating disease will disrupt the lives of many more. It is estimated that there will be 1.7 million new cancer diagnoses in the U.S. this year. The most common forms of cancer include:
- breast cancer
- lung and bronchus cancer
- prostate cancer
- colon and rectum cancer
- skin cancer
- bladder cancer
It is estimated that 38.4 percent of people, or almost 2 in 5, will be diagnosed with cancer at some point in their lives.
The good news is that modern medicine has developed many cancer therapies that can cause cancer to go into remission. There were 15.5 million cancer survivors in the U.S. in 2016, and this number is expected to grow to 20.3 million by 2026. Between 1990 and 2014, the cancer mortality rate fell by 25 percent.
The Burden of Cancer
In 2017, the U.S. spent $147.3 billion to treat cancer. Worldwide, cancer is one of the most expensive health issues, consuming almost 1.5 percent of the entire global domestic product every year. In the United States, not only is there a large cost for the cancer therapies themselves, but there is an enormous economic loss due to treatment, recovery and disability. It is estimated that 83 million years of life are lost due to cancer in the U.S. alone.
The costs associated with treating cancer can be broken down into three components. Half of all costs are due to doctor office of hospital outpatient visits, while 35 percent are related to inpatient hospital stays, and 11 percent of costs are for prescription drugs.
One study by the National Bureau of Economic Research estimates that adding an extra year of life following a cancer diagnosis in 1995 cost $54,100. By 2005, this number had grown to $139,100 in 2005, and to $207,000 by 2013.
Most Americans Are Financially Unprepared
If you are like most Americans, then you rarely consider a potential cancer diagnosis which makes it extremely unlikely that you have enough health insurance to cover all the costs of treating cancer. A new study in JAMA Oncology found that one-third of insured cancer patients paid more than they expected out-of-pocket. Sixteen percent reported high levels of financial distress due to treatment costs. On average, cancer patients were paying 11 percent of treatment costs out of their own pockets.
In 2014, the cost of cancer surgeries ranged from $14,100 to $56,600, while chemotherapy could cost from $14,000 for one month of treatment up to $102,000 for twelve months. The average cost of one course of radiation therapy ranged from $23,700 to $25,100.
Additionally, there are many hidden costs associated with cancer treatment including:
- lost wages
- food and lodging
- child care
- nutritional supplements
- special equipment and clothing
How to Avoid the Cost of Cancer Treatment
It should be obvious that getting treatment for cancer in America is a costly proposition, but you can do your part to avoid it. First of all, you can lower your risk of getting cancer in the first place. If you smoke or drink alcohol, stop immediately; your physician may be able to recommend some programs to help you quit. If you are overweight, lose weight since obesity is a major risk factor for cancer.
One of the best ways to prepare for cancer is to take out a supplemental health insurance policy. You can take out a policy specifically for cancer costs that will fill in the coverage gaps your primary policy might ignore. In many cases, a supplemental policy will disburse the coverage amount in a lump sum, so you can use the money for medical expenses or other costs associated with treatment.
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