Medicare Advantage

Medicare struggling with rising Hepatitis C healthcare costs

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An estimated 3 million Americans are now affected with Hepatitis C, which is more than AIDS. Research shows that the majority of patients are baby boomers. As such, Medicare spending for this condition increased to more than $9 billion in 2015. And while this may be a relief for Hepatitis C patients, all Medicare beneficiaries’ insurance costs have increased.

Research suggests that Medicare Part D (prescription drug coverage) spent $9.2 billion on hepatitis C drugs in 2015, a 96 percent increase from 2014’s $4.7 billion. This represents almost 7 percent of all Part D drug costs. Indeed, recent surveys show that these increasing healthcare costs have emerged as the nation’s leading healthcare concern.

Dormant and dangerous, for decades

Hepatitis C is a serious liver disease that is transmitted from a viral infection. While some people may get rid of the virus, it generally remains within the body, as a chronic (lifelong) infection. And as this condition can lie dormant for decades, with no symptoms, many are unaware that they’re even sick. If left untreated, it can lead to serious concerns, including liver damage, liver cancer, cirrhosis (excess connective tissue and painful swelling), liver cancer and even death. According to the Centers for Disease Control and Prevention (CDC), Hepatitis C is the leading cause of both liver cancer and liver transplants.

Baby boomers, those born between 1946 and 1964, make up 75 percent of all those with Hepatitis C. While the cause isn’t known, it’s believed that most were infected in the 1970s and 1980s, when rates were the highest. The nation’s blood supply wasn’t actively screened until 1992, when universal precautions were adopted. As such, baby boomers may have received contaminated blood and blood products. And as Hepatitis C typically spreads through contact with infected blood, some may have become infected from injecting drugs in the past.

While Hepatitis C can remain dormant for years, it may eventually destroy a patient’s liver, requiring an expensive transplant. Drugs are available that can cure the disease, but they may cost $80,000 to $100,000. According to Medicare’s economic analysts, these drugs are one of the main cost drivers for Part D. In fact, without the drugs, 2015’s costs per beneficiary would have increased by 4.6 percent; instead, they increased by 7.9 percent.

Part D paying the price

For 2016, the Part D deductible will rise to $360, up from 2015’s $320. This is the largest increase in Part D’s decade-long history. The Department of Health and Human Services (HHS) held a public forum last November to find ways to reward drug company research. At the same time, they wanted to ensure that innovative medications were affordable for patients, insurers, employers and government programs.

There may be some good news in 2016, as more Hepatitis C medications are set to enter the market. Previous treatments weren’t as effective and had serious side effects. However, newer drugs may offer effective cures, with minimal side effects. To keep costs low, some private insurers and state Medicaid programs require patients actually show signs of advanced liver disease before trying these new drugs. However, following doctors’ groups’ recommendations, Medicare does not impose these restrictions.