The ongoing outrage over the cost of hepatitis C treatments is, once again, prompting consumers to fight back against insurers that deny them access to the medicines. In the latest instance, a pair of lawsuits was filed that accuse two large insurers in the state of Washington of rationing.
The lawsuits, which were filed late last month in state court and seek class action status, charge that Group Health Cooperative and BridgeSpan restricted access to the medicines except to the “most severely ill” people, but not for a “clinical purpose.” Instead, the consumers charge the insurers do so due to “financial concerns.” And they want the insurers to provide coverage.
BridgeSpan requires “infected individuals wait for treatment — potentially for years — until they demonstrate serious scarring or cirrhosis of the liver from hepatitis C infection,” one lawsuit charges. Meanwhile, patients are “forced to live with … an increased risk of cancer or death.” The lawsuit pointed to criteria for the coverage decision made by Regence.
A spokesman for Group Health Cooperative declined to comment and we will pass along any reply that BridgeSpan sends us. [UPDATE: A spokeswoman for BridgeSpan similarly declined to comment, citing pending litigation.]
The newest crop of hepatitis C medicines — Gilead Sciences sells Harvoni and Sovaldi, while AbbVie (ABBV) markets Viekira Pak — boast cure rates exceeding 90 percent. Their arrival over the past two years marked a turning point because older treatments were less effective and caused difficult side effects.
However, the treatments cost between $63,000 and $94,500, depending upon the drug and the regimen, before any rebates offered to payers. And the price tags helped trigger a national outcry over the cost of pharmaceuticals.
For its part, Gilead, which is not named as a defendant in the lawsuits, has consistently maintained that its medicines offer good value because they lower the potential for long-term costs of treating liver disease, liver cancer, and transplantations.
Nonetheless, payers continue to complain the drugs have been budget busters, and many have taken steps to restrict coverage. For instance, shortly after Sovaldi became available in early 2014, Illinois officials instituted two dozen stringent criteria for usage.
This is the not the first time that consumers have fought back like this, though. Last year, consumers in California filed similar lawsuits against Anthem (ANTM) Blue Cross, claiming they suffered physical injuries, emotional stress, and economic damages, among other things, because access was restricted.
Health care experts had predicted still more lawsuits would be filed while prices remain high. What remains to be seen is whether the arrival of a new Merck hepatitis C drug, which is priced at $54,600, will generate sufficient discounting so that insurers loosen restrictions.
One health care expert thinks this is unlikely, though. “The fundamental issue is that it costs $54,000-plus. So it’s still a problem,” said Randy Vogenberg, a partner at Access Market Intelligence, a consulting firm that specializes in managed care.
Meanwhile, some state officials are trying their own strategies to lower the cost of hepatitis C drugs. Last week, the Massachusetts Attorney General threatened to sue Gilead for violating consumer protection laws if the drug refuses to lower its prices.