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Examining the Impact of HIV Drug Costs on Medicare Patients

MAY 08, 2020 | LAURIE SALOMAN
While Medicare shoulders a large share of the cost of drugs for Americans aged 65 or older as well as those who have disabilities, the enormous expense of HIV drugs—including antiretroviral therapy (ART) and preexposure prophylaxis (PrEP)—means that Medicare recipients living with HIV may still have a tough time affording these medications.

A team of investigators from the University of Hawaii in Honolulu, Massachusetts General Hospital in Boston, and other institutions published an analysis in JAMA Network Open of formulary and pricing files for 3326 individual first-quarter 2019 Medicare Part D plans from across the country. They found that the median annual retail cost of ART was $35,780, with patients expected to pay out of pocket as much as $4350. For PrEP, the median annual retail cost was $20,570, with patients responsible for $2990. Taxpayer-financed Medicare paid the greatest percentage of drug costs, anywhere from half to two thirds; if patients were eligible for low-income subsidies, Medicare might cover about 76% of ART expenses and 65% of PrEP expenses.

HIV drug prices rose 34% between 2012 and 2018 and continue to climb, which experts say is a huge issue.

“These drugs are life saving and should be just as affordable as medications to treat blood pressure or prevent heart disease,” study co-author Chien-Wen Tseng, MD, MS, MPH, a professor in the Department of Family Medicine and Community Health at John A. Burns School of Medicine, University of Hawaii, told Contagion®. “The problem is that these drugs have extraordinarily high prices—$20,000 to $40,000 per year—and patients pay a percentage of the drug price instead of a fixed-dollar copayment. So people get hit with a $500 copayment instead of $25 to fill a prescription.”

The stratospheric price tag of HIV drugs means people simply may not fill their prescriptions if they don’t have money left after paying for essentials such as food and housing, Tseng said. “It’s safe to say that if taxpayers were not subsidizing most of the cost of high-priced ART and PrEP, many people couldn’t afford life-saving treatment.”
 
According to co-author Rochelle Walensky, MD, MPH, an infectious disease physician at Massachusetts General Hospital and professor of medicine at Harvard Medical School, pharmaceutical companies need to find a way to lower HIV drug costs. “[T]he key issue is very high drug prices that keep going up without a clear or substantial improvement in the quality of the drugs,” Walensky said.

“Insurance plans should carry more of the cost, but this will likely lead plans to raise premiums. The real need is for lower drug prices or, at the very least, [to] prevent the inflation in drug prices year after year; these increases are simply for industry profit at the expense of the patients and the public.” 

Similar ART and PrEP regimens in countries that have generic options and negotiated pricing cost less than $100 per year, Walensky noted. Federal law prohibits Medicare from engaging in price negotiations. 

The problem is likely to get worse as more HIV patients age into Medicare. Right now 25% of HIV patients are covered by Medicare, a number that is expected to rise as ART allows people with HIV to live normal or near-normal lifespans. According to Tseng, almost half of people currently living with HIV are 50 or older. Unless laws are changed to give Medicare the ability to deal directly with manufacturers and to encourage competition among multiple players, excessive costs are likely to hamper our quest to end HIV in the U.S. 
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