pLOG

2026-04-07

Industry Insight Disparities in Out-of-Pocket Costs for Cancer Drugs: Institutional Reflections on Hospital Pricing Variations and Patient Accessibility

In Taiwan’s cancer treatment system, although many high-priced anticancer drugs are covered by National Health Insurance (NHI), patients who do not meet the specific criteria for reimbursement must still pay out-of-pocket. Significant disparities in self-pay pricing between different hospitals have long existed; the marked variations in how Taiwanese hospitals price targeted cancer therapies hold substantial research value.

Author: Evie Wang, Chief Operating Officer, PatientsForce

 

Using 90 hospitals across Taiwan as a sample, this study analyzes two oral targeted therapies already covered by National Health Insurance (NHI) using their NHI-reimbursed prices as a baseline.

The results show that hospital pricing for lung cancer targeted drugs exceeds the NHI price by 0% to 30%, with a median of approximately 20%. For breast cancer targeted drugs, the markup ranges from 0% to 37%, with a median of approximately 15%. Further analysis reveals that the magnitude of these markups is statistically and significantly correlated with hospital systems, religious affiliations, and regional market structures. For instance, public university-affiliated hospitals and certain hospitals with religious backgrounds show a relatively higher proportion of high markups, while distinct differences are also observed across various NHI regional administrative divisions.

The research indicates that disparities in hospital self-pay pricing reflect, to some extent, the gaps in regional medical resources and market competition environments in Taiwan. In areas where medical resources are highly concentrated, the relationship between market competition and pricing strategies varies. Furthermore, in the breast cancer drug market where competing products exist, there remains a statistically significant correlation between market concentration (HHI) at the county and city levels and the pricing markups.

For pharmaceutical practitioners, this study highlights a frequently overlooked phenomenon: while the industry widely discusses the drug price black hole, price discrepancies persist at the hospital level when patients ultimately obtain their medication—even after the drugs have undergone National Health Insurance (NHI) negotiations and supply chain price adjustments.

In other words, drug accessibility depends not only on whether a drug is included in the reimbursement list but is also closely linked to the pricing strategies of individual hospitals.

Against this background, the study raises another issue worthy of industry and policy discussion: when patients must pay out-of-pocket, it would be more aligned with their interests if hospitals released prescriptions, allowing community pharmacies or market channels to supply these self-pay medications. Internationally, some healthcare systems adopt a division of labor between hospitals and community pharmacies, enabling patients to obtain drugs through various channels based on their prescriptions, which also allows for greater market price flexibility.

For Taiwan, such a systemic discussion involves not only drug price governance but also hospital management models, pharmaceutical distribution management, and equity in patient access to treatment. As new cancer drugs continue to emerge and treatment costs rise annually, striking a balance between medical quality and market mechanisms is likely to become a critical issue of mutual concern for future healthcare policy and the industry.

On the other hand, in recent years, pharmaceutical companies have assisted patients to a certain extent in alleviating their medication burden through Patient Assistance Programs (PAP), such as providing medication education, treatment support, or partial financial assistance. However, given that the prices of new cancer drugs often reach tens or even over a hundred thousand dollars per month, self-pay treatment remains a heavy burden if patients do not meet the criteria for National Health Insurance (NHI) reimbursement. When price disparities between hospitals can reach as high as 30%, based on a one-year treatment course for certain oral targeted therapies, patients may end up incurring nearly $300,000 in additional expenses.

In this context, even if PAPs provide a degree of support, it remains difficult to fully offset the impact caused by these price disparities. If future institutional designs could appropriately introduce more transparent free-market mechanisms—such as hospitals releasing prescriptions under compliance-based premises to allow patients to obtain medications through various pharmaceutical channels—it may be possible to bring prices closer to competitive market levels while maintaining medical quality and medication safety, thereby further enhancing the accessibility of cancer treatments.

 

References
Wang, Y. W. (2025). Exploration of Factors Related to Self-Pay Markups for Cancer Drugs in Taiwanese Hospitals [Master's thesis, Institute of Hospital and Health Care Administration, National Yang Ming Chiao Tung University].