SIDEBAR: How Other Countries Are Controlling Oncology Costs

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The refrain is familiar: The United States spends more on health care than any other industrialized country, but the investment does not correspond to superior care. A recent study by The Commonwealth Fund, a health-care policy research foundation, shows just how stark the contrast is.

Instructive Data

According to the report, “Explaining High Health Care Spending in the United States: An International Comparison of Supply, Utilization, Prices, and Quality,”1 of the 13 industrialized countries examined (the United States, Australia, New Zealand, Canada, Denmark, France, Germany, Japan, the Netherlands, Norway, Sweden, Switzerland, and United Kingdom), the U.S. spends $8,000 per person on health-care services, while the other countries spend between one-third (Japan and New Zealand) and two-thirds (Norway and Switzerland) as much. And while the U.S. had the highest survival rates in breast cancer, as well as the best survival rates, along with Norway, in colorectal cancer, survival rates for cervical cancer were worse than average and far below that of Norway. Rather than greater utilization of physician and hospital services, the biggest drivers of higher costs in the U.S. are prescription drug prices and greater use of expensive technology such as MRI and CT scanners, according to the study.

Universal Health Care

The reason other industrialized countries are able to restrain health-care spending more effectively than the U.S.—although all are struggling with rising health-care costs—is that they provide universal health care and use cost-effectiveness analysis to form policy around their national health-care plans. As a result, expensive drugs or medical technologies that are not proven to be clinically beneficial and cost-effective are not covered under government health plans, even if they are approved for use.

“In Canada, where $5,800 per person is spent on health care, there are two levels of drug approval; one is for use, and one is for funding,” said Mary K. Gospodarowicz, MD, Medical Director of Princess Margaret Cancer Center in Toronto, and President of the Union for International Cancer Control. “Health Canada approves drugs for use. We have evidence-based cancer care, and if the evidence is inadequate or the drug is found not to be cost-effective, the Pan-Canadian Oncology Drug Review will turn down a drug for funding.”

If a drug is approved for use but not for funding, hospitals and clinics will not receive additional funding for the drug, although Canadians with private drug insurance can receive the drug in privately funded infusion clinics, explained Dr. Gospodarowicz. The main issue for Canadians, she continued, is the delay between the emergence of new evidence on a drug’s benefit and its approval for funding.

Although the Canadian system is not perfect, said Dr. Gospodarowicz, Canadians want the government to control health insurance. “Canadians may not like the execution—they would like care to be provided right away—but, in general, they accept some form of regulation to enjoy universal coverage. Although some people travel abroad to get health care, it’s a minority because of the high cost,” she said.

“I’m very fortunate to work in an environment in which the decision about cost vs benefit regarding treatment is made with the input of oncologists in the drug approval bodies,” Dr. Gospodarowicz added. “Generally speaking, we uphold our standards and use the agreed-upon guidelines to follow evidence-based recommendations when prescribing treatment.” ■

Disclosure: Dr. Gospodarowicz reported no potential conflicts of interest.


1. Squires DA: Explaining high health care spending in the United States: An international comparison of supply, utilization, prices, and quality. Issues in International Health Policy, May 2012. Available at Accessed November 12, 2012.

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