U.S. Oncology Survey: Employers Expect Cancer Costs to Spike by Up To 30% in Three Years, Hungry for Value-Based Models

San Francisco – Feb 26, 2024 – A new report finds a majority of employers expect annual cancer spend to rise by up to 9% each year over the next three years, adding up to a nearly 30% jump, while some think it could increase by up to three times that amount annually. Cancer already represents 16% of their total healthcare spend, so these findings speak to why employers are seriously worried about the increased incidence of cancer and soaring cancer costs, and why it’s become their top benefit priority.

To better understand the challenges they face, the specific drivers of spend, types of solutions they seek and barriers to adopting them, Carrum Health commissioned PwC to survey benefits managers across the U.S. at randomly selected self-insured employers with 5,000+ employees. The survey, conducted over several months in fall 2023, uncovered revealing data insights.

Anonymized results found a majority of their spend has been via the traditional fee-for-service model, and 83% stated they could not assess the return on investment (ROI) with their current oncology point solutions.

The survey revealed high interest and growing adoption of COE programs – 91% favor the bundled rate COE model that aligns incentives for providers to offer appropriate, high-quality care and assume risk. However, they are struggling to navigate the marketplace and find solutions that match all of their needs. So employers are settling on familiar but ineffective, disconnected point solutions, despite a preference for one-stop shop solutions that offer cost-effective treatment, mental health support, care navigation and early detection screening.

Reflective of the types of cancer incidences occurring in their employee population, 91% named breast cancer as a top three driver of cancer costs, followed by lung, colorectal and prostate cancers. Outpatient treatment for chemotherapy and radiation and the cost of drugs were the top areas of spend, findings that align with trends in the Medicare population. Nine out of ten employers stated they will seek an oncology benefit solution in the next two years.

“This report delves deep into the specific cancer challenges employers face, and why they continue to fall back on standalone or legacy solutions that fall short on delivering the member experience, improved health outcomes and cost savings they seek,” said Sach Jain, Carrum Health founder and CEO. “Their preference for a solution that offers bundled payments which align provider incentives with cost-effective care and addresses suboptimal employee experiences is loud and clear.”

The U.S. Oncology Employer Benefits and Center of Excellence Solutions: State of the Market 2024 report has comprehensive insights and data on employers’ current status quo, their priorities for employee population cancer care and the specific characteristics of the solutions they seek.

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About Carrum Health 

Carrum Health is changing how we pay for and deliver care. We offer self-insured employers a value-based Centers of Excellence (COE) solution that connects their members with a rigorously vetted network of surgical and cancer care providers. Carrum’s upfront all-inclusive bundled pricing, award-winning technology, and dedicated care navigation team help lower costs for both members and employers while delivering a superior member experience. Carrum reduces unnecessary procedures by as much as 30% and aligns cost and care incentives to save employers up to 45% per episode of care. Learn more at carrumhealth.com.

Media Contact:

Padma Nagappan

Press@Carrumhealth.com