The JAMA has a good article on how Hep-C should be treated from a cost effectiveness and quality of life point of view. *
We simulated 1000 individuals, but present the results normalized to a single HCV-infected person. In the base-case analysis, among patients receiving 8 or 12 weeks of sofosbuvir-ledipasvir treatment, treating all fibrosis stages compared with treating stages F3 and F4 adds 0.73 QALYs and $28 899, for an ICER of $39 475 per QALY gained. Treating at stage F2 (portal fibrosis with rare septa) costs $19 833 per QALY gained vs waiting until stage F3; treating at stage F1 (portal fibrosis without septa), $81 165 per QALY gained compared with waiting until stage F2; and treating at stage F0, $187 065 per QALY gained compared with waiting until stage F1. Results for other regimens show a similar pattern. At base-case drug prices, treating 50% of all eligible US patients with HCV genotype 1 would cost $53 billion. In sensitivity analyses, the ICER for treating all stages vs treating stages F3 and F4 was most sensitive to cohort age, drug costs, utility values in stages F1 and F2, and percentage of patients eligible for 8-week therapy. Except for patients aged 70 years, the ICER remains less than $100 000 per QALY gained. A 46% reduction in cost of sofosbuvir-ledipasvir therapy decreases the ICER for treating at all fibrosis stages by 48%.
Conclusions and Relevance In this simulated model, treating HCV infection at early stages of fibrosis appeared to improve health outcomes and to be cost-effective but incurred substantial aggregate costs. The findings may have implications for health care coverage policies and clinical decision making.
There are a couple of take-aways from this. The first is that the new Hep-C drugs should be made readily available to individuals who don’t have current significant damage to their liver. The second is that we need to find ways to push pricing down hard on these drugs and treatment regimes. The third is that the early intervention prevents a lot of suffering at an efficient price. The fourth is that early intervention to avoid long term costs is a massive risk adjustment problem.
I want to focus on the fourth.
Paying for Hep-C cures for people who are not in crisis and are not crashing is a prime example of a payer paying a lot of money and seeing very little of the gain being captured. It is not cost effective for most insurers to pay $80,000 for gains that will occur when the patient is no longer covered by that insurer.
For Medicare, this is not that big of a deal. Once someone ages into Medicare, they stick in Medicare. Medicare can internalize the costs of treatment of sickly 65 year olds over the next 15 years. Their risk adjustment process for Medicare Advantage will claw back money that would have followed an untreated Hep-C beneficiary while fee for service Medicare will see the claims never hitting the system.
For CHIP, the incidence of Hep-C is so low, it is a rounding error.
Medicaid is a bit messier as people who are Medicaid eligible especially in expansion states will see people go on and off Medicaid and to other insurers multiple times over the recapture time period. However, again risk adjustment payments are made in the background.
People who are on Exchange policies will see risk adjustment payments follow them for the year of the cure but the payment is insufficient to cover the full incremental cost of treatment even if the person stays with the same insurer for several more years. As we discussed earlier this week, the Exchanges are still very churny.
The biggest issue is private market employer sponsored coverage. An individual who gets an $80,000 treatment where the pay-offs aren’t accumulating for several more years is highly likely to be at a different company when those benefits start to accumulate. From a payer point of view, an ESI covered individual is all cost with very low gains. And since ESI is a special snowflake, there is no risk transfer payments to get insurers to maximize F2 treatment rates; instead the basic incentive is to treat the very ill, and minimize the number of doses that are given to the minimally visually ill in the hope that a large number of people from the F-2 cohort leave and are not replaced by other people switching out from other insurers who are doing the same thing. In this case, pushing people with F-2 scores from ESI into Exchange or any other risk adjusted program starts to make sense even if they are still to be covered by the same insurer. The tail cost is far less.
Ideally, there would be a $50 billion bill working its way through Congress which would be sufficient to treat everyone with Hep-C at severely discounted prices, full funding for needle exchange, and several other public health measures so that Hep-C could be effectively minimized to an annoyance problem in the United States with a very small potential infection carrier pool instead of an expensive and recurring problem as the carrier pool is not shrinking all that fast. But that would require spending money to utilize the federal government’s very long shadow to the future and risk bearing capacity to capture long term social benefits.
We can’t have that…..
*Chahal HS, Marseille EA, Tice JA, et al. Cost-effectiveness of Early Treatment of Hepatitis C Virus Genotype 1 by Stage of Liver Fibrosis in a US Treatment-Naive Population.JAMA Intern Med. 2016;176(1):65-73. doi:10.1001/jamainternmed.2015.6011.