The Costs of Caring: Who Pays? Who Profits? Who Panders?

Avastin, a widely used colon cancer drug manufactured by San Francisco-based biotech company Genentech, has proven a somewhat effective treatment for lung and breast cancer when administered at twice the normal dose. In February, the New York Times carried a story about Avastin's extraordinarily high price when used in this alternative way: $100,000 for one year's treatment--a figure fully twice the price of the normal dose, even though producing the higher dose costs the company little additional money. And the treatment yields only an average gain in life expectancy of five months--very modest relative to the cost. What garnered media attention, however, was Genentech's novel justification for the price: "the inherent value of these life-sustaining technologies." (1) Rather than making the usual appeal to high research costs, the company cited the pricelessness of human life, implying a moral reason for the pricing decision. I will pass in silence over the obviously self-serving disingenuousness of this appeal. The fact is that many in our society--and perhaps a substantial majority--think human life should be thought of as priceless. That assertion can be taken in three very different ways. We can take the pricelessness of human life to mean that the social worth of an individual (their social status or contribution to the national economy) should be completely irrelevant when it comes to determining how much society should spend to save or prolong that individual's life in the face of a life-threatening illness or accident--a worthy moral principle. Likewise, we should affirm the nonutilitarian view that the cost of saving either a life or a life-year should not determine by itself what will count as a just allocation of limited health resources when we cannot afford to save all the life-years medical technology may salvage. But we need to reject the view that we have a moral obligation to spend any amount of money to save all lives and life-years that medical technology permits. The result of adopting this view would be a gross distortion in our society's health care priorities that would not be just, compassionate, or prudent. To see why this is true, let us look at some facts and reasonable projections. Health spending in the United States topped $1.8 trillion in 2004, roughly 16.3 percent of our gross domestic product (GDP), compared to 5.2 percent in 1960. Projections to 2015 show us spending more than $4 trillion on health care then--almost 20 percent of expected GDP. (2) Medicare spending in 2005 was about $330 billion. With deployment of the prescription drug benefit in 2006, spending will be about $424 billion--a price tag expected to rise by 2014 to $747 billion. Over the ten-year period ending in 2015, Medicare spending will exceed $4 trillion. (3) These figures are socially and politically problematic, especially in light of growing federal deficits. Health policy analysts generally agree that emerging medical technologies drive escalating health costs. (4) Yet they and the public feel medical innovation should not be slowed or stopped--a conclusion I endorse as well. However, if we couple this belief with that third sense of the pricelessness of human life, the results are morally and economically disastrous. The problems posed by pricey medical innovation combined with a belief in the pricelessness of human life began with the passage of the 1972 End Stage Renal Disease (ESRD) amendments to the Medicare program. Those amendments created a program that would pay for renal dialysis or transplant for virtually any U.S. citizen in kidney failure. The program was motivated by the fact that thousands of patients died every year in the late 1960s because they could not afford the cost of dialysis (roughly $90,000 a year per patient in 2005 dollars). The rhetoric at the time was that no one should be denied access to effective, life-sustaining medical technology simply because they could not afford it, and society pressured Congress to pass the program quickly. …