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The Most Expensive Healthcare Costs in America

You have a chronic health condition. Every day is a struggle, and most people just don’t understand what it’s like to live with what you have to.

Your doctor prescribes a ‘leading treatment’ for this condition and promises that it is the best solution for keeping your condition manageable.

You go to the pharmacist to pick up your prescription and are given the news: a month’s worth of this drug is going to cost you $800. And that’s just your out-of-pocket costs. Your health insurance plan has to pick up the rest, meaning that the drug is profoundly more expensive than your $800.

Millions of people in the United States need so-called “specialty drugs” to manage their health problems: cancer, multiple sclerosis, Crohn’s disease, asthma, and a growing number of other chronic conditions. And even though these drugs are often covered by health insurance, they are usually kept on a different co-payment tier.

Instead of the $4 you might pay for generics or the $20 for a name-brand prescription, you could be asked to pay a percentage of the medication’s price. With specialty drugs, those prices often climb into the thousands.

Why Are Specialty Drug Prices So High?

First, specialty drugs are often radically different when compared to other prescription medications.

“Ordinary” prescriptions use chemicals to produce their therapeutic benefits.

Specialty drugs may be made using biological processes. That means they can’t be reproduced easily in alternative forms: competition is limited and generic options are rare.

Second, the current market for specialty drugs is small at the moment. Only 1% of all prescriptions in the United States are for specialty drugs. That means the number of users for each drug is small compared to more common medications such as Prozac or Ritalin.

Less users means less purchases overall, so prices have to be higher for a profit.

Take Avonex, for example. Known as an interferon beta-1a, this medication treats multiple sclerosis. Not only has it been shown to reduce the disabling of MS sufferers, but also it can reduce relapses by up to 30%.

This is great news for individuals an incurable MS diagnosis. But, the cost for one month can be as much as $3,000, with the patient paying a large percentage of that out-of-pocket.

Coming Up Next: More Money or Less Safety

Should patients be forced to pay hundreds of dollars a month for a medication just to preserve their quality of life? What about when they need it do stay alive, like people who need HIV or cancer specialty drugs.

Some states have already capped the maximum amount consumers can be asked to spend out-of-pocket. The 2013 Federal health care law also imposes caps. However, insurance companies argue that these caps will simply drive up premiums. Everyone would then shoulder the burden of such expensive medication, not just the critically ill.

Of course, price is not the only concern. Some people worry that the drug market may soon be flooded with more expensive but less safe alternatives to existing medications.

While not a specialty drug, the blood thinner Pradaxa is a good example of this trend. Many patients were switched off the more affordable and proven effective warfarin when Pradaxa hit the market. However, research found many of those patients experienced more complications than they did with warfarin.

As if being chronically ill was not bad enough, sufferers may have to choose between rent and quality of life. Or, they may be prescribed costly newer medications that leave their bank accounts emptier and their health in greater peril.

How Doctors are Fighting Back… Financially

A cancer diagnosis is always frightening to receive. But for many, the enormous treatment costs that go along with fighting the dreaded disease can be just as bad.

In the past, oncologists, doctors who specialize in cancer treatment, didn’t worry about the price of those treatments. Today, that’s starting to change. More cancer doctors are starting to realize their patients are concerned about the costs.

Especially if their patients are US citizens without healthcare coverage.

And while that might seem strange and obvious, most physicians aren’t really aware of drug costs. In a 2007 study, physicians were asked to guess how much their patients pay for certain medications.

The results?

Only 31% of physicians were even remotely close. Overall, doctors tended to say cheap medicine cost more while expensive drugs cost less.

It’s misconceptions like these that can be extremely troublesome for patients who have to carefully consider the price of treatment.

The Price of Life

Cancer drugs have become a huge and profitable market for pharmaceutical companies in the last few years. For example, Avastin helps slow the growth of tumors in patients with breast, lung, and colorectal cancers.

However, Avastin is not a cure; it only helps the patient live longer. And that precious extra time comes at a steep price.

A study published in the New England Journal of Medicine claimed the drug could increase life expectancy by nearly 5 months for patients with colorectal cancer… at a cost of $55,000.

That’s $11,000 per month of life.

Doctors Step Up

Treatments like Avastin are causing oncologists to think twice about how they care for their patients. One big change is to start looking at things more from a cost-benefit perspective.

While many physicians may assume the newest brand-name drug on the market may offer the best results, new studies are showing that cheaper generic versions are able to produce at least equal effects for most cases.

Plus, Johns Hopkins Medicine has found that patient’s health care dollars may be better spent on palliative care: care intended to reduce suffering and discomfort. Combine this with more affordable tests and medications and things start to look up.

At least financially.

On the Horizon

As doctors become more knowledgeable, they can also offer the most affordable treatment choices to patients.

Here’s an example. Oral medications for cancer treatment usually require higher co-payments than the same medications given by injection in the doctor’s office. In the past that was actually the case, but not anymore. Now that more physicians are aware of this change they can offer the more affordable treatment method.

Of course, the issue may get more complicated in the future.

An increasing number of medications targeted to specific types of patients will soon hit the market. The targeted drugs may cost more, but they may also be more effective for more specialized patients.

For example, patients whose cancer results from genetic mutations can be given drugs designed to work at that genetic level and, therefore, they should provide more effective treatment. Those same drugs would not work at all for if a patient’s cancer stems from another cause.

Doctors must be able to find the most effective treatment option in terms of results and in terms of patient cost. And now that they’re starting to take a hard look at treatment pricing, we’re on the right track towards more efficient healthcare spending.



-BS Pharm, PharmD, RPh

Dr. Paul Zickler is a graduate of the University of Wester Ontario in 1972. After graduating from the faculty of medicine, Dr. Zickler practiced as an Emergency Physician for 18 years. He has then operated ambulatory medical and travel clinics for 12 years. Dr. Zickler has become an Associate Professor of Emergency Medicine at the University of British Columbia, a Director of Professional Programs for the Justice Institute of British Columbia (paramedic academy), a principal investigator for Phase 2 and 3 studies researching vaccines, and a founding member of the Canadian International Pharmacy Association. Dr. Zickler is passionate about combining western prescription medicine and natural medicines.

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