Cuts hit cancer patients—foreshadowing broader limits under federal health care law

By Jennifer Popik, JD
Robert Powell Center for Medical Ethics

Jennifer Popik, JD

Jennifer Popik, JD

Starting this month, cancer clinics across the country have begun turning away thousands of Medicare patients, citing the Federal sequester budget cuts.

Oncologists took a 2% funding cut, and they say that it makes it impossible to administer expensive chemotherapy drugs if they are to remain open.  Large numbers of patients at these clinics are being told to seek treatment elsewhere, such as at hospitals.

While 2% might not seem like a major cut, chemotherapy drugs, especially new and effective ones, leave the clinics now bearing 2% more cost on a very expensive drugs.   Moreover, the impact foreshadows what will transpire once the 2010 health care law, commonly known as ObamaCare, takes full effect.

Ted Okon, director of the Community Oncology Alliance, which advocates for hundreds of cancer clinics nationwide, said, “If you get cut on the service side, you can either absorb it or make do with fewer nurses. This is a drug that we’re purchasing. The costs don’t change and you can’t do without it. There isn’t really wiggle room.”

One clinic among many, North Shore Hematology Oncology Associates in New York, decided that it would no longer see one-third of its 16,000 Medicare patients. The third that were cut were receiving medication on the more expensive end.

In a joint statement from the Community Oncology Alliance, the American Society of Clinical Oncology, the International Oncology Network, and US Oncology Network, they reported that 72% of cancer clinics (when surveyed) plan to deny new Medicare patients or send all Medicare patients to the hospital for treatment due to the cuts.  Disrupting cancer treatment for tens of thousands will no doubt put many lives at risk.

But the situation is even worse for those patients currently enrolled in clinical trials.  These kinds of trials are the critical step in advancing cancer treatments and new drugs that will be used to more effectively treat future patients.  Because of the complexity and small size of these trials, their ability to simply go someplace else for treatment is either limited or impossible.

Not only will current patients have their care disrupted and possibly delayed, but future treatments and cures will be impacted.  This one sector, cancer clinics for Medicare patients, is feeling the pain of cuts today.

However, under provisions of the 2010 health care law, the Federal Government will begin imposing similar limits across all health sectors after 2015.

The 2010 federal law creates an Independent Payment Advisory Board (IPAB), an 18-member cost-cutting board. In addition to having authority to limit Medicare reimbursement rates, IPAB also has a key role in suppressing nongovernmental health care spending.

IPAB is instructed to make recommendations to limit what all Americans are legally allowed to spend for their health care so as to hold it below the rate of medical inflation through 2017, and thereafter to the per-person growth in the Gross Domestic Product plus one percent.

If cancer clinics are turning away tens thousands of patients because of a 2% reduction, it will not take very long for  the IPAB limits to have an even more devastating effect on nearly every aspect of medical care.

The health care law authorizes the Department of Health and Human Services (HHS) to implement IPAB’s recommendations by imposing so-called “quality” and “efficiency” measures on health care providers, limiting what treatment doctors are allowed to give their patients. (Documentation can be found at

What happens to doctors who violate a “quality” standard by prescribing more lifesaving medical treatment than it permits? They will be disqualified from contracting with any of the health insurance plans that individual Americans, under the 2010 law, will be mandated to purchase. Few doctors would be able to remain in practice if subjected to that penalty.

This means that treatment a doctor and patient deem advisable to save that patient’s life or preserve or improve the patient’s health — but which exceeds the standard imposed by the government — will be denied even if the patient is willing and able to pay for it.

While Congress contemplates possible action on restoring the cut to oncology clinics, patients are having critical treatment delayed and disrupted.  Americans in all medical settings can expect these kinds of cuts starting after 2015 thanks to the IPAB, which is at the heart of the 2010 health care law.

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