Published Jan 30, 2014

Baltimore, MD, USA – In the United States, cancer is more prevalent in the elderly population, with more than 1.5 million new cases expected each year. It is the second leading cause of death in the US after heart disease, and is associated with high treatment costs. Unfortunately, Medicare does not cover all of these costs.  Regardless of the level of generosity of their supplemental insurance plans, Medicare beneficiaries newly diagnosed with cancer must still try to finance their cancer treatment, possibly liquidating assets or borrowing from family members. Using Medicare administrative data, researchers from the University of Maryland School of Pharmacy and the University of Vermont College of Medicine compared the total health care spending of Medicare beneficiaries newly diagnosed with cancer to the general Medicare population without cancer to examine the effect of having supplemental insurance coverage such as Medigap. The researchers discovered that, over a time period of two years, expenditures for Medicare beneficiaries with cancer was $15,605 more than the general Medicare population (after taking into account differences in demographics, socio-economic and health status). Despite the presence of different types of supplemental coverage, total expenditures did not widely vary and were essentially flat across the types of supplemental insurance studied. Mujde Z. Erten, PhD, Assistant Professor in the Department of Surgery at the University of Vermont College of Medicine, and the lead author of the study says, “Our results suggest that beneficiaries with cancer would be unlikely to reduce their total spending substantially in response to restrictions on access to Medicare supplemental coverage, and could end up with a much greater burden in out-of-pocket spending.”  The full study, “The Effect of Supplemental Medical and Prescription Drug Coverage on Health Care Spending for Medicare Beneficiaries with Cancer,” is published in Value in Health.

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