Medicare Reverses Denial Of Costly Treatment For Hepatitis C Patient

May 15

Walter Bianco, an Arizona man denied access to new drugs to cure his hepatitis C infection, will get the costly medications after all.

After Kaiser Health News and NPR’s Morning Edition described his plight in a story that aired Monday, federal Medicare officials said they would investigate. 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 two new drugs has not yet been approved by the Food and Drug Administration.

Late Tuesday, Bianco’s doctor got word that the earlier denials had been reversed – an unusually fast turnaround for the agency.

“I am very pleased that Mr. Bianco received approval for the treatment he needs,” said Dr. Hugo Vargas of Mayo Clinic in Scottsdale, Ariz. “I hope all patients in similar (or more urgent) circumstances can be given a fair hearing.”

Bianco, whose liver has been severely damaged by the hepatitis C virus, said Medicare’s reversal “is great news for me, and hopefully for many others, since a precedent has been set now.”

But it’s not clear what sort of a precedent Bianco’s case may set.

Sean Cavanaugh, deputy Medicare administrator, recently told a gathering of the US Chamber of Commerce that the agency is waiting for experts’ advice on how best to use the drugs, approved for use late last year, and which patients should get them first.

Medicare officials have reportedly been consulting with the Infectious Diseases Society of America and the American Association for the Study of Liver Diseases. Both groups have recommended the use of the new drugs for patients like Bianco whose livers are heavily damaged by the virus but who are not yet at the end-stage of infection – liver failure or liver cancer.

For now, Medicare’s Part D contractors may decide on a case-by-case basis whether to approve payment for the costly new drugs.

One of them, called Sovaldi, costs $84,000 for a typical 12-week course of treatment. The other, Olysio, costs about $66,000.

The issue in the case of Bianco and thousands of others, is whether Medicare will pay for their combined use – something not yet approved by the FDA, although Olysio’s manufacturer, Janssen Therapeutics, has sought approval of the combination.

Older hepatitis C drug regimens have not cured the infection in Bianco and many others. And some people also cannot tolerate their harsh side effects.

The issue of paying for the expensive new drugs – which cure upwards of 90 percent of patients — is being closely watched by patient advocates, federal health and budget officials, state Medicaid directors, the Department of Veterans Affairs, and corrections officials across the country. All face billions of dollars in potential obligations to treat the three to five million Americans infected by the deadly virus.

Cavanaugh says Medicare expects to know the potential cost burden of the new drugs by the end of this year. The agency will have more information after it receives bids in the coming weeks from Part D drug plan contractors, which will take the cost of the new treatments for the coming year into account.

The publication Inside CMS has reported that Gilead Sciences, maker of Sovaldi, gained 90 percent of the $2.1 billion first-quarter sales of the drug – a record for any new drug – from Medicare and private health insurers. Another 7 percent of sales came from Medicaid.

Medicare officials’ fast response in the Bianco case is an indication of the political sensitivity of rejecting potentially life-saving coverage based on drugs’ costs. “We want to try to be as helpful as we can to get beneficiaries the drugs that they need,” a Medicare spokesman said earlier this week.

Or to put it the other way around, no one wants to be the first to say that patients who need the drugs can’t get them– in other words, that hepatitis C has pushed the nation into explicit rationing of life-saving care.

Kaiser Health News (KHN) is a national health policy news service. It is an editorially independent program of the Henry J. Kaiser Family Foundation.

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