State Medicaid Reimbursement for Medications for Chronic Hepatitis C Infection from 2012 through 2015

Background: New direct-acting antivirals (DAAs) can cure chronic hepatitis C virus (HCV) infection. High DAA prices combined with a large number of patients needing treatment may pose substantial economic burden on health systems. Objectives: To examine Medicaid reimbursement for medications for HCV infection before and after the availability of new DAAs overall and by state and to also assess the impact of Medicaid expansion on reimbursement for DAAs. Methods: We calculated Medicaid reimbursements for medications for HCV infection between 2012 and 2015 in all 50 states and the District of Columbia. Outcomes included inflation-adjusted Medicaid reimbursement for medications for HCV infection, market share of individual DAAs, percentages of Medicaid outpatient pharmacy reimbursement for DAAs, and Medicaid reimbursement per Medicaid enrollee with HCV infection. Results: Medicaid reimbursement for medications for HCV infection increased from $723 million in 2012 to $2.35 billion in 2015. We found variations in Medicaid reimbursement for DAAs between states in 2014 (up to 7.4 times HCV infection prevalence) that widened in 2015 (0.1-11.4 times HCV infection prevalence). Expansion states had significantly higher increases in reimbursement for DAAs per enrollee with HCV infection compared with non- or late-expansion states ($2178.60; 95% confidence interval $1558.90-$2798.40), controlling for pre-expansion reimbursement. Conclusions: Medicaid reimbursement for DAAs differs across states after controlling for HCV infection prevalence. A third of states contributed more than 5% to 15% of pharmacy reimbursements to DAAs. Medications for HCV infection are only one class of highly priced specialty drugs. Innovative policy strategies are needed for health systems to manage coverage for an increasing number of expensive specialty medications indicated for an increasing number of patients.