A cure, but at what price?

Medicare struggling with hepatitis-C cure costs

Walter Bianco has had hepatitis-C for 40 years, and his time is running out.
“The liver is at the stage next to becoming cirrhotic,” the 65-year-old Arizona contractor said.
Cirrhosis is severe scarring, whether from alcoholism or a chronic viral infection. It’s a fateful step closer to liver failure or liver cancer.
If he develops one of these complications, the only possible solution would be a hard-to-get liver transplant. “The alternative,” Bianco said, “is death.”
Previous drug treatments didn’t clear the virus from Bianco’s system. But it’s almost certain potent new drugs for hep-C could cure him.
However, the private insurer that handles his medication coverage for the federal Medicare program has twice refused to pay for the drugs his doctor has prescribed.

Boomers and hep-C
Doctors are seeing more and more patients approaching the end-stage of hep-C infection.
“There isn’t a day that goes by when I don’t have a story very similar to Mr. Bianco’s,” said Dr. Hugo Vargas of Mayo Clinic in Scottsdale, Ariz., his liver specialist.
Researchers estimate 3 million to 5 million Americans carry the insidious hep-C virus. The biggest concentration is among those born between 1945 and 1965. Many, like Bianco, got hep-C from injecting street drugs in their youth. He said he’s been drug- and alcohol-free for 32 years, but the infection was permanent.
Other baby boomers got the virus from transfusions before 1992, a period when blood wasn’t screened. Some got it from sharing razors or toothbrushes, or from contaminated tattoo needles or hospital equipment. For some, transmission was sexual, although fortunately this isn’t the highest-risk route.
The timing of these infections spells trouble for Medicare, which insures Americans older than 65.
Hepatitis-C is a slow-acting virus. Over a period of 20 to 40 years, it causes liver damage in about 70 percent of people it infects.
A growing number of people who got infected in the 1960s through the 1990s have now “used up” the infection’s latency period, said Dr. Camilla Graham of Beth Israel Deaconess Hospital in Boston, “which is why we’re now seeing this dramatic increase in the number of people developing complications and dying of hepatitis. And we expect this to continue to increase for the next 10 years.”

Cure need could rise
Another part of Medicare’s problem is new hep-C medications are among the priciest of any drugs. One called Sovaldi, federally approved last December, costs $1,000 a pill – or $84,000 for a typical 12-week treatment course. The other recently approved drug, Olysio, costs around $66,000. Others in the pipeline are expected to be similarly expensive.
But Graham noted in the early days of successful antiviral drug treatment for HIV, payers allowed doctors to “mix and match” medications in “off-label” or unapproved combinations as they thought best.
“Medicare has been slower to adopt off-label combinations than most of the other insurance plans,” Graham said.
Medicare officials wouldn’t comment on coverage of new hep-C drugs. A spokesman wrote in an email the federal program turns such decisions over to private insurers that administer its drug plan, called Medicare Part D.
However, advocates say Medicare officials are well aware of the program’s looming exposure to the enormous costs of treating hep-C. Some say it could run in the tens or hundreds of billions of dollars, though it’s not clear over what period of time.
One thing likely to accelerate demand for treatment: Medicare is expected to approve payment for routine blood tests for hep-C infection soon. That will reveal many people who don’t yet know they’re infected – and spark difficult conversations between patients and doctors on when to use the expensive new medications to clear the virus from their blood.


Walter Bianco will get the costly medications after all. After Kaiser Health News and NPR described his plight in a story that aired May 12, federal Medicare officials said they would look into the case. Bianco’s appeal of an earlier denial had been rejected by WellCare, a private insurer that contracts with the federal program to provide drug coverage. The insurer rejected coverage saying the combined use of the costly new drugs has not yet been approved by the Food and Drug Administration – even though two doctors’ groups had recommended the protocol in cases like Bianco’s.
On May 13, Bianco’s doctor got word the earlier denials had been reversed – an unusually fast turnaround for the agency.
In a statement, Medicare officials indicate the new policy will apply broadly to hepatitis-C patients whose doctors prescribe the combined use of the two drugs because they meet certain criteria laid out in January by the Infectious Diseases Society of America and the American Association for the Study of Liver Diseases. Those guidelines recommend the combined use of the two drugs in patients with advanced liver disease who have failed to be cured by earlier drug regimens – even though the FDA has not yet approved the combination.
Medicare officials say beneficiaries “are required to have access to needed therapies” if they have demonstrated “medical necessity” and have “medically accepted indications” for the treatment.

• This article was produced by Kaiser Health News with support of the SCAN Foundation.

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