Three-dimensional radiation costs roughly $10,000. A somewhat newer treatment, I.M.R.T., initially cost $42,000. And an even more recent treatment, proton radiation therapy, costs $50,000. The newer treatments do not seem to be more effective at keeping patients alive than three-dimensional radiation, so under the proposal all three treatments would be reimbursed (after the three-year trial period for the new ones) at $10,000.
Despite some of its downsides, this is a good idea — and precisely the type of shift in our reimbursement system than needs to happen if we are to reduce cost growth over time.
Orszag’s plan makes sense but the health care industry is going to fight anything that will reduce the use of expensive therapy and medications.