New Laws Reduce Costs of Oral Cancer Drugs, but Not for All

A Conversation With Stacie B. Dusetzina, PhD

Get Permission

Stacie B. Dusetzina, PhD

Stacie B. Dusetzina, PhD

The rising cost of anticancer drugs not only adds fiscal pressure to our overburdened health-care system, but also increases the stress on patients with cancer and their families. High out-of-pocket spending may cause significant financial toxicity, even for patients with good health insurance coverage. In an effort to lower the costs of certain cancer drugs, states have enacted so-called parity laws. The ASCO Post recently discussed this important issue and related topics with policy expert Stacie B. Dusetzina, PhD, Associate Professor of Health Policy and Ingram Associate Professor of Cancer Research, Vanderbilt University Medical Center, Nashville. 

Drug Parity Laws 

In brief, please define drug parity laws. 

They are state laws designed to ensure that orally administered cancer drugs are not more costly for patients than anticancer drugs given by infusion at a clinic or hospital. Oregon was the first state to enact legislation for oral anticancer therapy parity about a decade ago. At this point, 43 states and Washington, DC, have enacted parity laws that require patients to pay no more for an oral cancer treatment than they would for an infusion. 

Please discuss drug parity laws in the context of access to chemotherapy. 

The overriding goal of oral anticancer parity laws is to ensure that patients who need orally administered drugs for treating their cancers will pay no more than patients receiving infused drugs. We’re trying to equate the out-of-pocket costs between oral drugs and infused drugs that are offered on pharmacy and medical benefits, respectively. 

When doctors prescribe an orally administered cancer drug, patients have at least two different charges—the amount they paid when they went to the oncologist’s office and the amount they will pay when they obtain the prescription drug from the pharmacy. However, for patients receiving infusion chemotherapy, these drugs are typically given at an office visit and not charged separately. In addition, advocates for parity have been concerned that differences in the coverage for medical and pharmacy benefits will mean that patients needing orally administered drugs will pay a larger share of the drug costs. 

ACS-Funded Research 

Please tell the readers about your collaboration with the American Cancer Society (ACS) on the issue of costs of cancer drugs. 

We were grateful to receive a grant from the ACS to study the impact of oral anticancer therapy parity laws on the use of oral cancer drugs, out-of-pocket spending by patients, and total health-plan spending. 

Impact on Costs 

How have parity laws worked to their projected ends? 

“Physicians are also becoming more aware of issues such as financial toxicity. ASCO in particular has done a commendable job integrating some elements of value and pricing into their guidelines, and I believe will continue to move the field forward in these efforts.”
— Stacie B. Dusetzina, PhD

Tweet this quote

In our research, we analyzed health claims data for 63,780 adults from 3 large, nationwide insurance companies before and after parity laws were enacted, from 2008 to 2012.1 We then compared the cost of filling a prescription for cancer drugs for patients in health insurance plans covered by state laws, compared to the cost of prescriptions for patients whose insurance plans were not. We included patients who lived in 1 of 16 states that had passed parity laws during our study period. 

We found that most cancer patients had reasonable out-of-pocket costs in relation to the price of the cancer drug. The median price per fill for an orally administered anticancer drug dropped from about $30 to nothing when comparing out-of-pocket spending before and after parity. Unfortunately, we also found that people paying the most for their drugs before the parity laws were passed saw their out-of-pocket costs potentially increase. For those whose costs were more expensive than 95% of other patients, their out-of-pocket costs increased an estimated $143.25 per month. Those paying more than 90% of what other patients paid saw their costs increase by $37.19 per month. 

Another important finding from our study was related to health-plan spending. One of the key arguments against passing parity laws—both for states that haven’t passed them and for legislation at the federal level—has been that it may increase costs to health plans, but we didn’t find evidence of that. In short, patients in plans that were subject to parity laws had similar spending patterns as those in plans that did not have to comply with parity. 

What caused this pricing issue? 

We couldn’t tell exactly what caused out-of-pocket spending to go up for some patients from the data we were using. We wondered if what was happening was caused by, for instance, paying more deductibles, because we know that the number of people facing deductibles has increased over time. 

Why is federal parity important? 

Something that people don’t often recognize is that parity laws are not only limited to people on private insurance, but also to people on fully insured health plans (and exempt from state insurance mandates), who don’t benefit from state parity laws. In our study, we found about half of the people in states that have passed parity laws don’t actually benefit. A federal solution to parity would actually help individuals in self-funded plans achieve those same benefits and could be designed in a way that helps to address gaps in current state parity laws. 

Affordable Care Act 

Was any provision for parity law included in the Affordable Care Act? 

No, parity was not mentioned in the Affordable Care Act (ACA). However, one important benefit from the ACA for privately-insured patients was the requirement for plans to have an out-of-pocket maximum that included prescription drugs. Before that legislation, most people’s pharmacy benefits didn’t have an out-of-pocket maximum, whereas medical benefits often would. For patients using orally administered anticancer drugs, the inclusion of prescription drugs in the out-of-pocket maximum can at least limit financial exposure.

Other Research 

Please talk a bit about your institutional grant (K award) from the National Institutes of Health and what it focused on. 

Using Surveillance, Epidemiology, and End Results (SEER)-Medicare data, we looked at the use of supportive therapies for women with breast cancer or people with colorectal cancer. We wanted to understand, in particular, the use of pain management, antidepressants, and antianxiety medications. 

We published nearly a dozen studies related to medication use among older adults with cancer, stemming from this work. One of the standout papers was led by an advisee of mine, Devon Check, PhD (now Assistant Professor at Duke University), whose work showed significant disparities in the receipt of supportive medications among black women with breast cancer.2 Dr. Check and additional members of the research team are continuing work in this important area today. 

Comparative Effectiveness 

Comparative effectiveness research dovetails with the issue of value-based care in oncology. Has comparative effectiveness had an impact on health-care coverage? 

Comparative effectiveness is still evolving, and I think there is still concern among some people that when we talk about value as it pertains to cancer therapies, insurance companies might limit choice to consumers. That said, I think the field is really starting to consider the role of value for the products we deliver to patients in a bigger way—not only the comparative effectiveness of a treatment, but also the financial impact of certain therapies. 

Physicians are also becoming more aware of issues such as financial toxicity. ASCO in particular has done a commendable job integrating some elements of value and pricing into their guidelines, and I believe will continue to move the field forward in these efforts. As more new cancer therapies become available, measuring cost and clinical value is all the more important. ■

DISCLOSURE: Dr. Dusetzina reported no conflicts of interest. 


1. Dusetzina SB, Huskamp HA, Winn AN, et al: Out-of-pocket and health care spending changes for patients using orally administered anticancer therapy after adoption of state parity laws. JAMA Oncol. November 9, 2017 (early release online)

2. Check DK, Samuel CA, Rosenstein DL, et al: Investigation of racial disparities in early supportive medication use and end-of-life care among Medicare beneficiaries with stage IV breast cancer. J Clin Oncol 34:2265-2270, 2016