How should we think about the cost of cancer screening?

August 20, 2024

You might have seen press coverage of a study from Annals of Internal Medicine that found that the US spends $44 billion annually on cancer screening. I’ll present some of the findings here and put them in context.

The researchers evaluated screening tests for breast, cervical, colon, lung and prostate cancers. Prostate cancer screening is currently only recommended after a discussion with a clinician, and lung cancer screening is recommended for those who have smoked more than 20 pack years (the equivalent of smoking one pack a day for 20 years) and who quit less than 15 years ago.

The researchers found that private insurance plans (which includes employer sponsored health insurance and marketplace plans) spend about $38 billion annually on screening for these five types of cancer.

Source: Halpern, et al Ann Int Med August 6, 2024 LINK

Here is the distribution of cancer screening tests each year across the private insurance population:

Source: Halpern, et al Ann Int Med August 6, 2024 LINK

There might be some overuse of cancer screening. For instance, cervical cancer screening is only recommended every 3-5 years, so I was surprised that more women each year get cervical cancer screening (pap smear or HPV test) than mammography. Unfortunately, the standard HEDIS quality measurement for overuse of this test only measures overuse in adolescents.

You might be surprised that private insurance represents such a large portion of total screening costs. Private insurance paid for about 72% of the screenings, and about 88% of the costs. That’s because the Medicare fee schedule is substantially lower than what private insurance pays. Here is the difference in allowable charges:

Source: Halpern, et al Ann Int Med August 6, 2024 LINK

Colorectal cancer screening represented most of the costs (55%) in private insurance. Colonoscopy and Cologuard were more commonly used than FIT testing, which is much less expensive. Colonoscopy is recommended every 10 years, sigmoidoscopy or CT colonography every 5 years, Cologuard every 3 years, and FIT tests annually. See this summary of colon cancer screening recommendations.

Implications for employers:

-        Total costs for cancer screening are about 1% of total medical costs - and there is excellent evidence that the cancer screening recommended by the US Preventive Services Task Force (USPSTF) saves lives.

-        However, some screening tests are overused, and in some instances, employers could encourage less costly and still highly effective cancer screening.

-        Cancer screening is cost effective but not cost saving. Doing more cancer screening will not lower total medical expenses.

-        Unit costs for cancer screening are high for private insurance, and efforts to better control unit costs could help constrain spending on all medical services including cancer screening.

Thanks for reading.  You can find previous posts in the Employer Coverage archive

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Tomorrow: Cancer rates are going up in younger people