Cost-effectiveness of Total State Coverage for Hepatitis C Medications


Objectives: Most Medicaid recipients with hepatitis C virus (HCV) are not treated with direct-acting agents due to budget constraints, but experience costly complications after becoming eligible to medicate. maryland’s “full coverage” proposal could receive a medicare credit to offset medicaid investments in treatment that could lead to medicare savings. This study examines the cost-effectiveness and budget impact of full coverage of HCV treatments sponsored by state Medicare and Medicaid.

Reading: What is hepatitis c treatment medication price disclosure off insurance

Study Design: A Markov model simulated patients moving through the HCV continuum of care. The model simulated 3 pathways: standard coverage with a 50% chance of HCV detection and a 20% chance of treatment; total coverage stratified by risk with an assumed probability of detection of 80% and a treatment rate of 60%; and full coverage with an assumed probability of detection of 80% and a treatment rate of 100%.

Methods: The model calculated US dollars and quality-adjusted life years (qalys) to generate an incremental cost-effectiveness ratio evaluated at a willingness-to-pay threshold of $100,000/qaly . the budget impact for the state of maryland was calculated in terms of per member per year.

Results: Full coverage and risk-stratified coverage saved $158 per patient and $178 per patient, respectively, compared to standard care with 0.05 and 0.02 higher effectiveness qalys for 25 years. full coverage and risk-stratified full coverage would save $1 billion and $1.1 billion, respectively, after 25 years.

Conclusions: Medicare-Medicaid partnerships to pay for all HCV treatments represent good value for money and low budget impact. States with problems in covering HCV treatments should consider using this model to plan coverage decisions.

I am j I manage care. 2021;27(5):e171-e177. https://doi.org/10.37765/ajmc.2021.88640

points to take away

Expanded coverage under a joint Medicare/Medicaid partnership to treat all prevalent cases of hepatitis C virus (HCV) appears to be cost effective by saving money and improving patient outcomes.

  • This coverage policy could save $1.4 billion over 25 years.
  • This is the first economic evaluation to consider the effects of a joint Medicare-Medicaid partnership for HCV drug coverage.
  • In states where Medicaid does not have enough funds to cover all HCV treatments separately, Medicare is justified in supplementing funding for treatment coverage to avoid dealing with symptoms of the disease as the population grows. get old.
  • Direct-acting antivirals (DAAs) are associated with greater than 95% cure rates for hepatitis C virus (HCV).1 However, historically, the exorbitant costs of DAAs have made access difficult. prohibitive for many patients. patients were rarely able to afford the full costs of these treatments when they entered the market at a price of more than $80,000, let alone the out-of-pocket copays associated with these drugs, which could exceed thousands of dollars per course of treatment.2 changes in the market and range of daa offerings in recent years have potentially made hcv treatment more affordable, with prices ranging from $20,000 to $30,000 in addition to copays, but this issue is not resolved, especially for Medicaid eligible or uninsured populations.3,4

    Today, many state Medicaid programs cover DAAS for less than 30% of HCV patients due to prohibitive prices.5 The challenge for Medicaid with DAA coverage is primarily a budget issue.6 if all eligible hcv medicaid recipients were simultaneously covered for a daa, it would represent billions of dollars in excess of the total annual budgets of most state medicaid programs.7,8 as a result, medicaid programs are reluctant to spend money when the costly consequences of hcv often occur years later when patients are enrolled in medicare. 9

    Therefore, Medicare has significant financial incentives to partner with Medicaid today to treat the majority of HCV cases, thereby minimizing the impact of future HCV symptoms on the Medicare budget. maryland’s total cost of care (tcoc) model represents a proposed policy designed to do just that, with the possibility of receiving a medicare credit to offset medicaid investments in daas that could lead to medicare savings. this financial model would address the mismatch between who spends money on health care and who benefits.

    the profitability of daas has been increasingly explored in a number of value-based purchase scenarios.10-12 however, the value of the maryland tcoc proposal (i.e. “full ) remains unknown. We examine the cost-effectiveness and budgetary impact of full coverage sponsored by the state of Maryland for AADs for all HCV patients from a health care sector perspective and from the perspective of the state’s Medicare budget. both perspectives incorporated patient, payer, and provider costs for hcv treatment. The goal of this economic evaluation was to determine whether a policy such as TCOC is a good value and would support the Medicaid program budget in Maryland, as well as potentially in other states facing an emerging concern of high rates of HCV in those eligible for Medicaid. , uninsured, and elderly populations.


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    we developed a markov-structured semi-infectious disease model to assess the cost-effectiveness of daa coverage plans for hcv patients enrolled in the maryland medicaid program. we refer to this as “semi-infectious” because the model does not identify full secondary transmission effects. the model had 3 comparison arms. the standard care option represented current state policies on daa coverage and screening decisions for hcv patients. The first alternative represented full DAA coverage for all HCV patients in Maryland. the second alternative represented full coverage with priority for access to daa first for hcv patients who are at high risk of increasing chronic symptoms.

    The model was designed to provide an incremental cost-effectiveness ratio (ICER) and budget impact for Maryland taxpayers, at a 3% discount. The Markov model examined common transitions between health states adjusted to current standards of care in Maryland, such as HCV diagnosis and treatment with coverage in 1-year cycles over a 25-year time horizon. This time was necessary to measure the costs associated with health complications due to HCV. The main outcome measures used in the ICER calculation were 2018 us$ and effectiveness in terms of quality-adjusted life years (qalys). ICER was calculated from the perspective of the health care industry in accordance with methodological specifications established by the US Panel on Profitability in Health and Medicine.13 Final ICER results were interpreted at a willingness-to-pay threshold of $100 000/qaly.14

    model design

    the semi-infectious disease model evaluated the cost-effectiveness of HCV outcomes based on higher odds of treatment in the full coverage scenario, compared to 2 scenarios reflecting the current payer model with standard coverage for all beneficiaries or priority coverage for all high-risk beneficiaries (figure 1). in this latter alternative, 60% of patients with chronic hvc who had a liver fibrosis score of 2 or more, versus a fibrosis score of 0 or 1, received daas first, before lower-risk patients, to better manage budget impact.15

    The standard coverage arm measured 50% current detection probability for chronic HCV and 20% probability of subsequent acceptance of daa treatment. Patients begin in the states of “vulnerable population” (ie, susceptible to contracting HCV), “Acute HCV,” or “Chronic HCV,” depending on their health status, level of behavioral risk, and symptoms. patients who started or progressed to chronic HCV were modeled to have higher rates of increasing outcomes, although they were less likely to accrue costs of DAA treatment.

    then the model included coverage for hcv detection. patients who were screened and found to have hcv would be treated with a course of daas. once treated, most patients would go into a “healed” state or proceed to a cured state with the additional presentation of acute liver disease (ald).

    Some patients who received treatment would likely fail one form of DAA and switch to another type of DAA to eventually enter a state of healing. the presence of ald during treatment could also be an effect modifier on treatment failure, noted as “ald treatment failure” in the model.

    As consistent with a semi-infectious disease model, some patients would enter a “post-cure reinfection” state because their behavioral risk factors leading to initial HCV infection could influence reinfection with non-trivial probability . those in the “acute HCV” state could also influence the infection rates of the vulnerable population, as untreated HCV cases lead to the spread of infection.

    Patients diagnosed with chronic HCV but not receiving treatment, as well as patients with HCV who were not screened (and therefore not treated), may show symptoms of HCV progression. hvc, such as decompensated cirrhosis16 and hepatocellular carcinoma (hc). a small fraction of hcc patients would ultimately face the prospect of a high-cost liver transplant. patients in any of these chronic symptomatic states, in addition to treatment failure, also faced the prospect of death.

    model parameters

    Costs for HCV and ALD patients were extracted from studies using private insurance and Medicare claims. Based on reports by McAdam-Marx and colleagues, as well as the sources used in Van Nuys and colleagues’ estimates of the incremental costs of chronic HCV, we subtracted the reported costs of antiviral drugs and then calculated a weighted mean of $5,435 per patient. 7 ,17-19 The costs of post-cured advanced liver disease were extracted from the research by Cheung et al.20, we did not attribute costs to being in the vulnerable population or to death. daa treatment costs were based on the wholesale price of glecaprevir/pibrentasvir (mavyret; abbvie): $26,400 to $39,600 for an 8- to 12-week treatment cycle (table 1 [part a and part b]1,4,7,12,15,18-32). this cost represents the newest daa treatment available on the market at the lowest cost available that would likely approve medicaid.

    We measured the current detection probability of 50% for chronic HCV and the subsequent acceptance probability of DAA treatment at 20% in the standard care arm.21 one cycle later. patients with full coverage had an 80% probability of detection to reflect the increased awareness and coverage that would result from such an initiative. For those who are screened for chronic HCV, there was 100% acceptance of DAA treatment; these values ​​adjusted the assumptions of the state. In the high-risk model, only 60% of chronic HCV patients screened received DAA treatment per year, based on DAA coverage findings in the Medicaid population by Karmarkar.15

    Public health services measured in units of qalys were drawn from existing economic models that used public services in the past.12,22 These qalys are typically drawn from eq-5d index scores of preference weights based on us.33

    Upon completion of the model, the consistency of our results with the results determined by van nuys and colleagues was checked.7

    impact on the budget

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    After the ICER calculation was completed, a budget impact calculation was also performed to estimate the annual per member costs of allocating Maryland taxpayer contributions to the Medicaid and Medicare budgets to implement full coverage. we assumed that 50% of chronic hcv patients were enrolled in medicare and 100% of patients in stages ald were medicare eligible. This assumption was based on the fact that the 1945-1965 birth year cohort will be eligible for Medicare within the next 10 years.

    model assumptions

    The model started from a population of 6,050,000 individuals, of whom 50,000 currently had HCV, and half of whom were born between 1945 and 1965. Those without HCV remain in the “vulnerable population” stage. . We also assume a constant probability of infection of 0.13% of the vulnerable population in Maryland, which is based on the infection rate in 2017 according to hepvu, and a probability of reinfection of 0.95% among HCV patients during the HCV phase. of post-cure.23 We also assumed that patients diagnosed as treatment-naïve patients would undergo additional screening before they were finally started on DAA.

    Under full coverage, we assume an 80% detection and 100% chance of treatment. this assumption was made so that the state would have an upper bound estimate of the cost of this program. we assumed that untreated patients would experience a continuous progression of outcomes in increasing stages, including specific odds of mortality.24 We also assumed that patients with undiagnosed HCV who were experiencing these outcomes would become aware of their HCV status during these stages. . the model assumed reinfection of some treated patients and newly infected patients from the existing cohort.

    Under the full coverage alternative that prioritizes high-risk patients, we assume an 80% detection and 60% chance of treatment. 60% treatment rate is based on Maryland Medicaid coverage rates in high-risk cohorts: chronic HCV patients with a fibrosis score of 2 (F2) and fibrosis scores of 3 and 4 (F3 and F4 ) have treatment rates of 85.4%. and 97.5%, respectively.15 For all HCV patients in Maryland, f2 patients make up 40% of the population, and f3 and f4 patients make up 27% of the population.15 under the assumption of The Medicaid program would first cover all high-risk chronic HCV patients with fibrosis scores of 2 or more, this constitutes a risk group of approximately 60% of patients screened.

    This model did not take into account the indirect medical and social effects of an HCV cure. other assumptions were that the current political environment and trends in health care policy remained the same.

    sensitivity analysis

    Sensitivity analyzes were performed to test the uncertainty in the design of the economic model. we performed 1-way and 2-way univariate sensitivity analyses, as well as Bayesian multivariate probabilistic sensitivity analyzes on all model parameters. 1-way sensitivity analyzes varied the parameters of detection and treatment probabilities. For the probabilistic sensitivity analysis, we tested the uncertainty in all parameters simultaneously using 1,000 Monte Carlo simulations. 34 parameters with no published distributions had assumed a cis of +/- 25% above and below the reported mean or median. beta distributions were applied to probabilities and utilities whose value ranged from 0.0 to 1.0, and gamma distributions to cost parameters ranging from 0.0 to positive values ​​greater than 1.0.


    Full DAA coverage and risk-stratified Full DAA coverage dominated standard coverage as preferred payer models over the 25-year time horizon (Table 2). full coverage saved $158 per patient compared to standard care ($529 vs. $687) with a greater effectiveness of 0.05 qalys (16.33 vs. 16.38 qalys). risk-stratified full DAA coverage saved $178 per patient compared to standard care with a greater effectiveness of 0.02 qalys. both interventions represent clinically significant improvements in qalys for a large patient population.

    In a direct comparison of full DAA coverage versus risk-stratified DAA coverage, full DAA coverage is a cost-effective option at a slightly higher cost to provide greater clinical benefit. The ICER for the additional return on full DAA coverage is $675/qaly, implying that providing access to DAAS for all patients is good value.

    At the health care sector level, full coverage would break even after 10 years and save $1 billion after 25 years, and risk-stratified AAD coverage could save an additional $1.1 billion. This timeline reflects estimates presented by Van Nuys and colleagues.7 However, if you focus on the budget impact of full Medicare coverage, there was an incremental cost increase of $7.55 per taxpayer per year. therefore, if this program were implemented, the additional $635.9 million in public funds spent on AAD treatment would amount to less than $10 per year among state taxpayers.

    Profitability results for full coverage compared to standard coverage did not vary across ranges tested in 1-way or 2-way univariate sensitivity analyzes (Figure 2). From a state budget perspective, the model was most sensitive to the cost of chronic non-cirrhotic HCV and the treatment rate for full coverage. Increases in the cost of chronic non-cirrhotic HCV and decreases in the rate of full coverage treatment from our baseline estimates suggest that Medicare would save costs.

    Probabilistic sensitivity analyzes showed that full DAA coverage alternatives were cost-effective compared to standard coverage in 99.9% of simulations (Figure 3). uncertainty around utility values ​​did not affect the results. In our budget impact calculation, 98% of the simulations resulted in an overall incremental cost to Medicare within 25 years.


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