Determining & Managing Hepatitis C Healthcare Costs
Jul 17, 2019
July 28th is World Hepatitis Day and in observance we want to spread awareness to our readership about this debilitating and costly health condition, as well as some newer areas of cost containment.
Hepatitis, or inflammation of the liver, can be caused by a variety of viruses, conditions and behaviors. One of the most common and expensive forms of Hepatitis is HCV or Hepatitis C. HCV is a liver infection negatively impacting both patients and self-funded health plans in part due to its highly expensive treatment options and prescription costs. Furthermore, HCV is difficult to diagnose early enough for successful intervention, and symptoms often go undetected up to the development of more serious complications or comorbidities – leaving self-funded health plan employers in an uphill battle against Hepatitis C with a strong need to do something to control the associated costs.
Health and cost outcomes for HCV are inherently dependent on individualized diagnosis, treatment, prevention, and the healthcare providers’ ability to facilitate all three factors. According to Centers for Disease Control and Prevention, “an estimated 2.4 million people in the United States are living with hepatitis C virus infection.” Hepatitis C is preventable and curable, however. The challenge lies in maximizing the value of treatment costs relative to the individual HCV case while effectively managing the infection from progressing into more serious complications.
Currently, the CDC website states that an “HCV infection becomes chronic in approximately 75%–85% of cases.” This contrasts with Acute Hepatitis C, which is a short-term version of Hepatitis C that lasts 6 months and is typically cured naturally by the body. It’s important to note that Acute Hepatitis C is not the same as Chronic Hepatitis C and that improper diagnosis / HCV management can lead to catastrophic conditions – such as Cirrhosis, Liver Cancer and Liver Failure.
Oftentimes, self-funded employers lack the necessary clinical staff and or case management resources to properly communicate educational treatment information that best addresses the risks unique to the patients attempting to manage this condition. Fortunately, self-funded employers are not alone. Innovations in prescription and treatments for HCV have developed significantly. Treatment previously consisted of months of injections that left patients feeling ill – many of whom could not continue due to health complications. According to Jeffrey S. Murray, M.D., internist at the FDA specializing in infectious diseases, “now, patients can treat their hepatitis C with only pills—drug combinations that are faster and have a higher cure rate.”
A couple of the most successful drugs developed to treat HCV were approved in December of 2013 in pill form. Namely, Sovaldi and Olysio. While Sovaldi and Olysio are prescribed separately, both drugs are part of an antiretroviral treatment plan that combines each with a host of other drugs. According to the US National Library of Medicine National Institutes of Health one pill of Sovaldi costs about $1,000 ($84,000 for the standard twelve-week plan), and Olysio is estimated to cost $23,600 for a month of treatment. The high prices, lengthy treatment and the large numbers of HCV patients make Hepatitis C one of the more debilitating conditions for a health plan and its members to endure. With a demonstrated “cure rate of over ninety percent in some populations” treated with Sovaldi, the drug’s widespread popularity comes as no surprise. In 2014, the total healthcare spend for Sovaldi was “$6.5 billion, making it the drug with most overall expenditures in the United States in 2014. Of this figure, Medicare’s share of this spending was reportedly $4.5 billion dollars.”
Mavyret is $26,400 for an 8-week course and $39,600 for a 12-week course
Vosevi is $74,760 for a 12-week course
Zepatier is $54,000 for a 12-week course
Daklinza is $25,200 for a 12-week course
Harvoni is $94,500 for a 12-week course
Unfortunately, these incredibly high drug prices have compelled states to restrict access to certain HCV drugs and in some cases have prompted private insurance payers to require rigorous prior authorization for treatments that include specified drugs.
While these drugs may be expensive, they help cure HCV infection with greater success and eliminate the potential risks of HCV-induced complications such as liver failure, cancer or cirrhosis.
In addition to being safer and having a greater rate of success these medications also have a shorter length of treatment. A shorter treatment means that the individual suffers less and avoids potential costs relative to length-of-treatment and mismanagement of the infection. An argument, therefore, can be made that even with steep initial costs these new drugs might provide greater value than cheaper alternatives over time.
The Importance of Prevention
Prevention is and always will be the most valuable healthcare cost containment approach available. An early HCV diagnosis can lead to the prevention of more serious and life-threatening conditions and their respective costs. Identifying the individuals who are at an elevated risk is a critical and a necessary initial step towards implementing preventive Hepatitis C initiatives. Education that supports early diagnosis is crucial but difficult since most patients fail to realize they are at-risk for lack of knowledge of their symptoms, or if the symptoms fail to show up until later stages. Whatever the case, many patients are unaware of their condition until HCV has done significant damage to their liver – often leading to a need for liver transplant. According to the FDA website, the CDC says: “Once infected with the hepatitis C virus, nearly 8 in 10 untreated people remain infected for life.” This statistic paints a concerning image of a population in dire need of support to manage a volatile condition.
Without proper guidance and support for their unique HCV infection patients might become overly eager to find a quick fix solution. This eagerness leads many patients to make healthcare cost containment pitfalls. For example, without guidance, patients will opt to take the latest most current and expensive HCV drugs, like Sovaldi, “despite the fact that an older drug may be just as likely to cure their infection, and at a fraction of the cost,” according to ncbi.nlm.nih.gov.
In an effort to reduce costs some HCV patients have resorted to importing otherwise expensive HCV treatment drugs from various countries via online pharmacies where they can purchase the drugs at a lower price. Some employers are exploring this option as well. Proceeding with caution in this area is important as this can be a dangerous practice. As noted by the US National Library of Medicine National Institutes of Health’s website, “over the internet pharmacies could misrepresent their location and where they obtained the medications. Additionally, many countries do not meet the same rigorous standards of drug production and screening as the United States.” Once an overseas source of medication is deemed safe, this can be a viable option for cost-savings.
Seeking Cost Relief – Applying Value-Based Payment Models to HCV
HCV management is complex, ever-changing and incredibly difficult to carry out successfully. The American Association for Study of Liver Disease developed the “HCV Guidance: Recommendations for Testing, Managing, and Treating Hepatitis C,” to help entities manage HCV and Hepatitis. Despite these efforts the current approach, tools and even payment model employed to manage Hepatitis C and the associated costs are limited. Traditional Fee-For-Services models have failed to properly address the painpoints of dealing with HCV – like patient access and adherence – and payers are now looking toward value-based bundle payments as a potential solution.
An example of new payment model innovation was recently covered in the news when a health plan announced a value-based payment model program to address HCV prevalence and the shortcomings of traditional payment models. As Satya Sarma, MD, their chief medical officer explains, “our current fee-for-service models simply don’t incentivize [social determinants of health] activities, do not drive innovation or efficiency, and do not reward providers for quality care, instead encouraging volume over value.” Unlike fee-for-service models, value-based models place the responsibility for managing medication adherence and virus elimination on the providers’ shoulders. The new payment model in theory will improve compliance and encourage innovative care protocols “to break down barriers that prevent hepatitis C patients from receiving and complying with the treatment.” Dr. Sarma believes the healthcare system is a fragmented industry and that new technologies are slow to make a difference in part due to the current payment methodologies. She further explains that in order to help offset this disjointed system, the outcomes-based bundled payment structure will work in “conjunction with the holistic treatment model our providers are developing.” A holistic approach involves patient data sharing, open collaboration and case discussions between providers, care management teams and physicians to identify the optimal HCV treatment path for an individual through care management and data analytics.
Identifying Those at Risk
Every HCV case is as unique to the health plan as it is to the individual. The total costs for HCV are more dependent on the treatment value and less dependent on the treatment price. As mentioned previously, one could argue that investing in expensive HCV drugs with shorter treatment lengths provides a greater long-term value than a less expensive drug with a longer treatment and greater risk of developing co-morbidity would. Conversely, and as stated on ncbi.nlm.nih.gov, “for some genotypes, new expensive treatments may not be as cost effective as standard of care. Therefore, limiting newer more expensive treatments to the populations for which they have the most value is a reasonable approach to managing the Hepatitis C burden with the limited resources available.”
The challenge here would be to identify the individuals within a population carrying the specified genotype to then provide them the education and resources they’ll need to make the decision with the greatest value for themselves and the health plan. Additionally, the FDA shared that the CDC recommends a blood test for “hepatitis C as part of routine medical care for everyone born between 1945 and 1965 and those with other risk factors, including people who got a blood transfusion before 1992, have a history of injecting illegal drugs at any time, or are on hemodialysis (kidney dialysis).”
Health analytics technology is making great strides in identifying individuals who have HCV, are at risk for kidney disease, liver disease, and more. It can also identify those who are at risk for further complications.
Thanks to significant advances in predictive analytics technology those at-risk individuals can be identified earlier and provided the support they need more proactively. Analytics have proven particularly adept at helping to identify those who are slipping through the cracks of an existing case, disease and chronic condition management programs. A self-funded health plan’s success is dependent on whether the employees take accountability for their health - or not. Therefore, self-funded employers would be wise to assume the accountability of providing quality care resources patients need to manage their HCV from spiraling into a catastrophic event(s).
Advanced Plan for Health’s Poindexter’s predictive analytics can help increase quality and targeting for early diagnosis, and more effective care management and treatment adherence. Contact us here if you’d like to learn more about how Poindexter can deliver the macro to micro-level visibility you need to identify and support those in need of HCV support, as well as other predictors of diseases, chronic conditions and co-morbidities within your population.