Increased hepatitis C coverage offers limited relief to plan sponsors

by Leo Almazora17 Apr 2017
A recent report from human resource consulting firm Morneau Shepell notes that while public coverage for hepatitis C drugs has been expanded, it is limited relief to plan sponsors being squeezed by cost pressures.

The report noted that the pan-Canadian Pharmaceutical Alliance (pCPA) recently reached a pricing agreement with several companies for six high-cost prescription drug treatments for hepatitis C. The drugs, according to the report, are approved through each province’s special-access program, since they aren’t included in the provinces’ regular formularies. Currently, only individuals with certain genotypes or severities of hepatitis C are eligible for coverage.

Following the pCPA deal, Ontario and BC have expanded their coverage for the six drugs. In Ontario, the six drugs were added to the Ontario Drug Benefit (ODB) plan on February 28, making them available for ODB recipients as limited-use benefits. BC’s PharmaCare program was expanded in March to cover more hepatitis C patients; in 2018, the province will expand coverage further to include any resident with chronic hepatitis C, regardless of the genotype or severity.

Following the two provinces’ lead, Saskatchewan announced its own coverage expansion effective April 1. Whether other provinces or territories will do the same remains unclear.

The limited provincial coverage for hepatitis C medication means that much of the cost remains with private entities, including private group insurers. In Quebec, private group insurance plans have had to cover hepatitis drugs under particular eligibility criteria since 2015. Private group insurance costs and pooling charges have been impacted, prompting the Quebec government to say that it intends to progressively relax the eligibility criteria to lessen their impact on private group plans.

Various estimates suggest that as many as 250,000 Canadians have hepatitis C, the report said. While new hepatitis C therapies boast success rates of 95% with fewer side effects than previous options, they typically cost $45,000 to $100,000 per person. This has affected many plan sponsors in the form of increased drug plan costs and rising premiums required by insurers for pooling and stop-loss protection.

“The expansion of coverage for these drugs under several provincial health care programs is favourable news for plan sponsors, though it does not eliminate the risk or impact of claims hitting group plans up to the stop-loss limit,” the report said.