California taxpayers could be on the hook for聽billions of dollars to treat hepatitis C patients in various state-funded programs, according to a聽report released聽Tuesday聽by an insurers鈥 trade group.
罢丑别听聽estimates that paying for the patients鈥 high-priced hepatitis C medications in prisons and state hospitals,聽or through Medi-Cal and other state programs,聽could range from聽$512聽million to聽$5.1聽billion. The wide-ranging聽estimates depend on how many patients are treated and聽how much聽the drugs are discounted聽by manufacturers.
Charles Bacchi, president and CEO of the association, said聽the report underscores聽what is to come聽in the聽near future聽when more costly prescription drugs are approved. The high costs聽aren鈥檛 sustainable for health plans, consumers or taxpayers, Bacchi聽said.
鈥淲ith a slew of new high-priced drugs set to hit the market this year 鈥 this report really shows how that number can be multiplied,鈥 Bacchi said. 鈥淚t could be a huge hit to the taxpayers.鈥
罢丑别听new聽hepatitis C medications聽are聽a vast improvement over previous treatments聽and聽can聽cure patients.聽But their staggering cost聽has prompted a national debate about聽their聽outsized bite into health聽care budgets.聽The estimated costs have聽led to policy changes, hearings, lawsuits and ethical debates about who should receive the treatments.
An聽estimated 3.2 million people聽nationwide聽have聽, a virus that is the leading cause of cirrhosis and liver cancer.
Gilead Sciences Inc., which聽won approval for聽the drug Sovaldi聽in 2013, has been criticized for charging about $1,000 for each pill 鈥 or about $84,000 for the 12-week treatment. Another of its drugs, Harvoni, costs聽more.
Gilead has said the prices are聽fair because the drugs are聽highly effective and can prevent future medical costs to treat liver disease or聽provide聽transplants.
One聽study聽last year聽by the nonprofit Institute for Clinical & Economic Review found that if half of聽hepatitis C-infected Californians received聽the new medications,聽annual聽drug costs could rise by聽$22 billion.
鈥淭hese cures聽are not free, 鈥 said聽Steven Pearson, president of the Boston-based institute.
Health officials聽in most Medicaid programs around the country聽are聽prioritizing who receives the hepatitis C medication, according to a 聽in the Annals of Internal Medicine. The high costs are 鈥渇orcing many payers to ration this lifesaving treatment,鈥 the study said.
California鈥檚 Department of Health Care Services issued a new policy, effective Wednesday, which sets聽new聽guidelines on which patients can receive state-funded hepatitis C treatment.聽The department聽estimates聽that聽between 3,000 to 4,000 Medi-Cal members will seek treatment next year聽and says that decisions about who gets the new聽medications聽will be based upon medical necessity rather than cost.
California鈥檚 budget, which was signed last week,聽allotted $228 million in additional funds聽for specialty drugs聽to treat hepatitis C聽patients in the state hospitals and prisons聽and on聽state programs such as聽Medi-Cal.聽Covered聽California, the state鈥檚 health care marketplace, recently approved a cap on specialty drugs that would limit most consumers to paying $250 per month per prescription.
The state聽has convened a working聽group to review the state鈥檚 policies and expenditures on high-cost drugs,聽including those used to treat聽hepatitis C.
Hepatitis C medications have聽triggered more discussion about drug development, pricing and use than any drugs聽in recent history,聽and聽the debate is far from over, Pearson said.
鈥淎 lot of new expensive drugs are on the horizon,鈥 Pearson said, referring to treatments for various聽conditions.聽鈥淒rug costs could go up significantly and have a major impact on the budgets.鈥
Two聽costly聽medications聽— one聽for high聽cholesterol聽and one for heart disease —聽are expected to get FDA approval later this summer.聽Cancer聽drugs聽in the pipeline聽could have similarly high price tags.
罢丑别听hepatitis C聽research was聽done by The Taylor Feldman Group聽for聽the聽health plan聽association, which seeks聽to raise awareness聽of the cost to聽taxpayers,聽health plans and consumers, Bacchi said. He noted聽that聽private聽health plans handle the vast majority of Medi-Cal patients through managed care.
Emalie Huriaux, director of federal and state programs for Project Inform, a patient advocacy group based in San Francisco,聽was skeptical of the findings.
罢丑别听report聽is 鈥渂ased on a lot of assumptions that can鈥檛 be verified,鈥澛爏he聽said.
She said聽insurers聽and pharmaceutical companies are 鈥渢hrowing rocks at each other鈥 rather than coming up with solutions to the high prices.聽 罢丑别听report, she said, is聽another example of that.
Huriaux said聽something has to be done to聽lower costs, reduce restrictions and聽improve access for consumers, many of whom聽have lived with the聽hepatitis C聽virus for decades聽yet聽have been聽told they aren鈥檛 sick enough to get the medications.
鈥淚t comes down to how much should you pay for a cure?鈥 she said. 鈥淕iving people access shouldn鈥檛 bankrupt the public systems and it shouldn鈥檛 break individual鈥檚 bank accounts.鈥
helps fund KHN coverage in California.