Medicare cuts Parallel Drop in Unnecessary Prostate Cancer Treatment

Kathleen Blanchard's picture

A study shows a reduction in unnecessary treatment of prostate cancer following Medicare cuts, that also points to benefits associated with financial health care reform. The study found when Medicare reimbursement was cut, the use of androgen deprivation therapy for prostate cancer treatment also dropped – but men who would most benefit still received the treatment.

The findings point to the success of financial health care reform that can reduce unnecessary patient care and health care dollars spent. According to lead study author Vahakn B. Shahinian, M.D., M.S., assistant professor of internal medicine at the University of Michigan Medical School and a member of the U-M Comprehensive Cancer Center, physicians "don’t tend to cut out necessary care, but they tend to cut out unnecessary or inappropriate care. This suggests cutting reimbursements in the right context can help reduce unnecessary care."

Lower Medicare Reimbursement no Impact on Quality Patient Care

The research suggests cutting health spending would not impact quality patient care. Physicians continued to prescribe androgen deprivation therapy for men who would clearly benefit. Dr. Shahinian says, “We found that physicians respond to reimbursement, but they respond in a way that appears to be beneficial to the patient.”

The findings come from an analysis, published in the New England Journal of Medicine that looked at profits made from androgen injections. Though there is clear benefit for radiation/hormone therapy for men with aggressive types of prostate cancer, the benefits for low-risk tumors are less clear.

During the 1990’s Medicare reimbursed 95 percent of the cost of androgen injections, and physician practice’s paid 82 percent of the drug cost, leading to wide profit margins. At one point, a half million men were receiving the injection and 1 billion dollars in Medicare expense.


When reimbursement dropped from the Medicare Modernization Act of 2003, reimbursement for injectable medications became less profitable, leading to steady and appropriate use of androgen treatment. Inappropriate use of the prostate cancer treatment decreased from 39 percent at the end of 2003 to 22 percent by the end of 2005. Reimbursement for the injection fell from $356 to $176 per dose during the same timeframe.

The researchers explored the Surveillance, Epidemiology and End Results-Medicare database to find the benefit associated with reigning in health care spending. Study author Yong-Fang Kuo, an associate professor at the University of Texas Medical Branch at Galveston explains, “SEER-Medicare has all the detailed cancer and treatment data we needed to categorize these patients, and it gave us a very good picture of the response to this change in Medicare reimbursement.”

During the same time, more studies were being performed showing side effects associated with androgen therapy that could have some bearing on the study findings.

Dr. Shahinian says, “Androgen deprivation therapy remains a life-saving treatment for a certain subset of patients, and in our study, those patients continued to be prescribed this treatment. Financial incentives are most likely to impact physician behavior when there’s a gray zone in terms of benefit, not when there’s clear evidence of life-saving benefit.”

Medicare cuts that helped reduced health care spending for unnecessary prostate cancer treatment had no negative impact on quality patient care, pointing to benefits of financial health care reform.

University of Michigan Health System