[REMOVE HEP letterhead, INSERT agency letterhead]
DATE
[REGULATOR title]
[Regulator Address]
Re: Removing Illegal Restrictions to Access to Hepatitis C Treatment
Dear [Insurance Commissioner]:
On behalf of the Hepatitis Education Project (HEP), which advocates for individuals
living with hepatitis, we are writing your office out of concern about the practices of
commercial health benefits carriers in [INSERT STATE] restricting access to HCV curative
treatment.
We have attached a white paper that discusses this chronic, lifelong, life-threatening
viral disease and the remarkable new drug therapies now available to cure it. We are in the
midst of a national epidemic as it is estimated that anywhere from 3-5 million people in the
United States are living with HCV. [Insert State Statistics about prevalence of patients with
HEP C in relevant State]. Previous therapies came with potentially debilitating side effects and
were ineffective in more than half the HCV patients who endured the treatment. Many patients
suffered greatly as their disease progressed. Many HCV patients required liver transplants or
died while waiting for a matching liver donor; others progressed to serious complications from
the disease.
Now there is hope. In the past two years, the FDA has approved revolutionary new
drug therapies that cure almost all HCV patients with very few side effects. Rather than
celebrate this historical breakthrough, HCV patients, providers and advocates are forced to
spend an inordinate amount of time and resources attempting to overcome unjust barriers to
access treatment.
As we have outlined in more detail in the attached white paper, these restrictive barriers
to treatment, put in place by both public and private payors, contradict national medical
practice guidelines that unequivocally support treating all HCV patients. These restrictions on
treatment also contradict public policy, are discriminatory, violate medical necessity provisions
in private insurance contracts and violate state laws.
On November 5, 2015, the Centers for Medicare and Medicaid Services (CMS) also
recognized that restrictions on HCV treatment in place among State Medicaid programs around
the country were illegal. They issued guidance to the individual states urging them to review
their practices and cover treatment consistent with established medical practice guidelines.
Hepatitis Education Project  911 Western Ave Ste 302  Seattle, WA 98104  206-732-0311
HepInfo@hepeducation.org  http://www.hepeducation.org
That guidance can be found here:
http://www.medicaid.gov/medicaid-chip-programinformation/by-topics/benefits/prescription-drugs/hcv-communication.html.
We provide this detail hoping your Office will promptly act to eliminate these improper
barriers to HCV treatment access in [INSERT STATE]. We welcome the opportunity to
engage with your Office to discuss this issue. Thank you for your attention to this matter on
behalf of patients living with HCV.
Sincerely,
Name
Title
Organization
cc:
[Insert other Key Insurance Department Officials and/or Local Stakeholders]
Hepatitis Education Project  911 Western Ave Ste 302  Seattle, WA 98104  206-732-0311
HepInfo@hepeducation.org  http://www.hepeducation.org
White Paper
A Call to Eliminate Commercial Carriers’ Improper Denials of Coverage for
Revolutionary Drugs that Cure HCV-Infected Patients
It is estimated that anywhere from 3-5 million people in the U.S. are afflicted with
chronic Hepatitis C (HCV), many of whom do not know they have HCV because they have little
outward symptoms of disease.1 Previously available therapies were only moderately effective in
treating many patients and were difficult to endure as they had serious side effects. Fortunately,
new revolutionary drugs are available that cure HCV in most patients. However, many barriers
to these new drugs needlessly remain. This white paper addresses the restrictions being placed
by insurance carriers to block patient access to these revolutionary drugs and demonstrates these
practices contradict public policy, are discriminatory, violate medical necessity provisions in
private insurance contracts and are illegal.
A. Background on Hepatitis C
Before documenting the practices of insurance carriers in [insert STATE] that improperly
deny coverage for HCV medication, a brief discussion of Hepatitis C (HCV) is necessary to put
them in context. This description and common questions and answers about HCV come from the
Centers for Disease Control and Prevention (CDC) website:2
“Hepatitis C is a contagious liver disease that ranges in severity from a mild
illness lasting a few weeks to a serious, lifelong illness that attacks the liver. It
results from infection with the Hepatitis C virus (HCV), which is spread
primarily through contact with the blood of an infected person. Hepatitis C can
be either “acute” or “chronic.”
Definitions

Acute HCV infection is a short-term illness that occurs within the first 6
months after someone is exposed to the HCV. For most people, acute infection
leads to chronic infection.

Chronic HCV infection is a long-term illness that occurs when the
HCV remains in a person’s body. HCV infection can last a lifetime and lead to
serious liver problems, including cirrhosis (scarring of the liver) or liver cancer.
See e.g., “The prevalence of hepatitis C virus infection in the United States, 1999 through 2002” Armstrong GL1,
Wasley A, Simard EP, McQuillan GM, Kuhnert WL, Alter MJ, Ann Intern Med. 2006 May 16;144(10):705-14.
2
Center for Disease Control and Prevention website, page last updated May 31, 2015,
http://www.cdc.gov/hepatitis/hcv/cfaq.htm#transmission.
1
Hepatitis Education Project  911 Western Ave Ste 302  Seattle, WA 98104  206-732-0311
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Statistics

How common is acute Hepatitis C in the United States?
In 2013, there were an estimated 29,718 cases of acute HCV infections reported
in the United States.

How common is chronic Hepatitis C in the United States?
An estimated 2.7 million persons in the United States have chronic HCV
infection.3 Most people do not know they are infected because they don’t look or
feel sick.

How often does acute Hepatitis C become chronic?
Approximately 75%–85% of people who become infected with HCV develop
chronic infection.”
CDC estimates that between 2.7 million and 3.2 million people in the U.S. are living with
chronic HCV. CDC’s estimates, however, substantially understate the extent of the epidemic.
Many patients remain undiagnosed and are not reflected in reported CDC numbers; this includes
people who are homeless or institutionalized, many of whom belong to groups with high rates of
HCV (e.g., veterans and people who inject drugs). This also includes prisoners incarcerated in
local, state and federal correctional institutions.
Regardless of the true numbers of affected individuals, HCV is a transmissible disease
which, if untreated, has a high likelihood of resulting in very serious complications, including the
development of cirrhosis, liver cancer, the need for liver transplantation, and ultimately death.
This disease is one of the leading causes of liver cancer and death in the U.S.,4 particularly
among baby boomers, and can remain asymptomatic for decades, making it difficult to convince
people to get tested and treated. CDC estimates that deaths caused by HCV range from 17,000
to 80,000 patients nationally each year; and since 2007, HCV has accounted for more annual
deaths in the U.S. than HIV.5 HCV patients are twelve (12) times more likely to die compared to
those without HCV and have a life expectancy 23 years less than those who are not afflicted with
the disease.6
HCV’s burden on [INSERT STATE] is also significant and growing. [INSERT STATE
SPECIFIC STATISTICS RE number of infections and death caused by HCV]
3
Many experts who work with HCV patients have informed the CDC they believe their prevalence rates
significantly understate the true impact of this epidemic. See e.g., “Data supporting updating estimates of the
prevalence of chronic hepatitis B and C in the United States, ” HEPATOLOGY, Robert G. Gish, Chari A. Cohen,
Joan M. Block, Carol L. Brosgart, Timothy M. Block, Ryan Clary, Loc T. Le, Michael H. Ninburg, Lorren Sandt,
Kris V. Kowdley, doi:10: 1002/hep 28026.
4
Ly KN, XING J, Klevens RM, Jiles RB, Ward JW, Holmberg SD. The increasing burden of mortality from viral
hepatitis in the United States between 1999 and 2007. Ann Intern Med 2012;156:271-278.
5
Ly KN, Xing J, Liu SJ, Moorman AC, Rupp L, Xu F, Holmberg SD. Causes of death and characteristics of
decedents with viral hepatitis, United States, 2010. Clin Infect Dis2014;58:40-49.
6
Mahajan R, Xing J, Liu SJ, Moorman AC, Rupp L, Xu F. Holmberg SD. Mortality among persons in care with
hepatitis C virus infection: the chronic hepatitis cohort study (CHeCS), 2006-2010. Clin Infect Dis 2014;58:10551061.
Hepatitis Education Project  911 Western Ave Ste 302  Seattle, WA 98104  206-732-0311
HepInfo@hepeducation.org  http://www.hepeducation.org
B. Established Medical Guidelines Support Treatment for All HCV-infected
Patients
The American Association for the Study of Liver Diseases (AASLD) is the leading
organization of scientists and healthcare professionals committed to preventing and curing liver
disease. The Infectious Diseases Society of America (IDSA) is the leading organization of
scientists and practitioners who study and treat infectious diseases. These two organizations
have jointly issued and maintain the leading medical guidelines on the screening and treatment of
HCV (HCV Guidelines). The HCV Guidelines review the scientific literature and provide
specific recommendations and criteria for the screening and treatment of patients with chronic
HCV infection. The AASLD and IDSA also continually update the Guidelines as additional
scientific and medical evidence emerges.7 These Guidelines are the gold standard in HCV care.
The AASLD and IDSA have updated the HCV Guidelines to specifically address some of
the restrictive barriers most commonly used by insurance carriers to prevent patient access to
new breakthrough therapies. These medically unnecessary barriers include restricting treatment
only to patients with evidence of significant liver damage nearing cirrhosis and denying
treatment to patients with evidence of chronic alcohol or drug use. Each of these restrictions will
be discussed.
C. Restricting New Breakthrough Therapies Only to Patients with Severely
Damaged Livers Is Inconsistent with Medical Guidance
We know from working with HCV patients, their physicians, and other providers and
publicly available medical policies that insurers commonly restrict coverage to new
breakthrough HCV treatments to only those patients with evidence of liver damage that reaches a
“Metavir” score of F3 fibrosis or F4 cirrhosis (on an F0 to F4 scale). This is akin to reserving
chemotherapy for patients with late stage (stage 3 or 4) metastatic cancers. Such rationing
should not be tolerated.
Restricting access to treatment only to those suffering from advanced liver disease and
who face imminent harm contradicts best scientific and medical evidence. The HCV Guidelines
recommend treating all HCV-infected patients regardless of current liver fibrosis level with the
new medical therapies, including patients with F0 to F2 fibrosis.8 While previous iterations of
the HCV Guidelines had discussed prioritizing treatment urgently for patients with more severe
liver damage, the Committee removed all mention of prioritization in their most recent update of
October 22, 2015.9 However, insurers and payors continue to use the previous prioritization
7
For more detail on the AASLD and ISDA, the HCV Guidelines and the methodologies they use to develop them,
visit http://www.hcvguidelines.org/.
8
“Recommendations for Testing, Managing, and Treating Hepatitis C,” American Association for the Study of
Liver Diseases, Infectious Diseases Society of America, last updated August 7, 2015, page 31 (PDF version). The
HCV Guidelines’ recommendation for treatment exclude a small subset of patients: “Patients with a limited life
expectancy, for whom HCV therapy would not improve symptoms or prognosis, do not require treatment.” Id. at
40.
9
Press release for HCV Guideline, October 22, 2015, accessed November 2, 2015;
http://hcvguidelines.org/sites/default/files/when-and-in-whom-to-treat-press-release-october-2015.pdf
Hepatitis Education Project  911 Western Ave Ste 302  Seattle, WA 98104  206-732-0311
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discussion in the guidelines as support to deny coverage for patients not currently suffering from
severe liver disease or exhibiting severe liver damage.
Such selective citation of the HCV Guidelines is inappropriate. Even before the most
recent update, the IDSA and AASLD already had felt compelled to address this practice in an
update, dated June 28, 2015, by emphasizing the HCV Guidelines’ recommendation to treat all
HCV patients regardless of their fibrosis score.10 The HCV Guidelines cite numerous research
studies demonstrating early treatment improves HCV patients’ long term health outcomes,
reduces the mortality risk of the disease and reduces the risk of further transmission of HCV.11
The IDSA and AASLD assigned its highest degree of confidence based on the research
supporting its recommendation for early treatment (“Class IA”).12
Postponing treatment increases the risk of serious disease and also generates additional
costs of follow-up tests and medical office visits that could be avoided with early treatment. For
example, treatment delay significantly increases the risk of HCV patients ultimately developing
liver cancer. The HCV Guidelines recommend that even in patients whose virus is eliminated
after treatment, if they had progressed to advanced fibrosis (F3/F4) before treatment, they should
undergo surveillance and ongoing ultrasound testing for liver cancer twice a year for an
indeterminate time due to this elevated risk.
In sum, insurance carriers’ categorical denials of HCV medication for people with early
stage or no fibrosis are not supported by best practice guidelines or by the underlying medical
evidence that informs the Guidelines. They have no basis for reversing the considered medical
opinion of physicians and substituting their judgment for that of treating physicians, who are
acting consistent with evidence-based best practice guidelines. Insurance carriers’ practices to
delay HCV treatment until patients exhibit serious liver damage or exhibit other symptoms of
severe disease will also cause serious harm and generate increased costs over time. Patients
initially denied treatment will invariably need treatment eventually, and will incur additional
monitoring costs and for some, substantial costs for treating other liver complications that could
10
The HCV Guidelines as of August 20, 2015, page 31, stated in pertinent part:
Because of the myriad benefits associated with successful HCV treatment, clinicians should treat HCVinfected patients with antiviral therapy with the goal of achieving an SVR, preferably early in the course of
their chronic HCV infection before the development of severe liver disease and other complications. Recent
reports suggest that initiating therapy in patients with lower stage fibrosis may extend the benefits of SVR.
In a long-term follow-up study, 820 patients with Metavir stage F0 or F1 fibrosis confirmed by biopsy were
followed for up to 20 years. The 15-year survival rate was statistically significantly better for those who
experienced an SVR than for those whose treatment had failed or for those who remained untreated (93%,
82%, and 88%, respectively; P =.003). The study argues for consideration of earlier initiation of treatment
(Jezequel, 2015). Several other modeling studies suggest a greater mortality benefit if treatment is initiated
at stages prior to F3. (Øvrehus, 2015); (Zahnd, 2015); (McCombs, 2015).
See HCV Guidelines at http://www.hcvguidelines.org/full-report/when-and-whom-initiate-hcv-therapy,
page 31 (PDF version).
11
12
Id. at 32, 38.
Id.
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have been avoided. For these reasons, insurance carriers’ restrictions on access to early HCV
treatment must cease.
D. Insurers’ Denial of Coverage Violates Insurance Contracts Requiring Coverage
for Medically Necessary Care.
Not only are commercial carriers’ restrictions inconsistent with scientific evidence and
medical practice guidelines, but they violate their insurance contracts. Commercial insurance
contracts cover “medically necessary” healthcare services except for certain identified and
defined exclusions. In some states, the term “medically necessary” is defined by statute or
regulation.13 [INSERT STATE SPECIFIC CITATION IF APPLICABLE] The respective
definitions of “medically necessary” among carriers are substantially similar and well established
in the industry. A typical example of the definition is quoted below:
“Medically Necessary or Medical Necessity means health care services or supplies that
a Physician or other health care Provider, exercising prudent clinical judgment, would
provide to a patient for the purpose of preventing, evaluating, diagnosing or treating an
illness, injury, disease or its symptoms, and that are:



In accordance with generally accepted standards of medical practice;
Clinically appropriate, in terms of type, frequency, extent, site and duration, and
considered effective for the patient’s illness, injury or disease; and
Not primarily for the convenience of the patient, Physician or other health care
Provider, and not more costly than an alternative service or sequence of services or
supply at least as likely to produce equivalent therapeutic or diagnostic results as to
the diagnosis or treatment of the patient’s illness, injury or disease.
For these purposes, “generally accepted standards of medical practice” means
standards that are based on credible Scientific Evidence published in Peer-Reviewed
Medical Literature generally recognized by the relevant medical community, Physician
Specialty Society recommendations and the views of Physicians and other health care
Providers practicing in relevant clinical areas and any other relevant factors . . .
[emphasis added].”14
In the above definition — as in virtually all definitions of medically necessary —
established medical practice guidelines play a prominent role in defining what is medically
necessary and what is therefore contractually required to be covered. For treating HCV, the
HCV Guidelines are the foremost authority for ascribing when HCV treatment is medically
necessary. The HCV Guidelines recommend treatment of virtually all HCV patients regardless
of level of liver fibrosis, with very few exceptions.15 Because “established medical standards” –
i.e., the HCV Guidelines – are the primary basis for determining “medically necessity”, then
providing treatment to all individuals living with HCV, regardless of fibrosis score is per se
13
See e.g., Ark, Code ⨐23-99-507(2001), Cal. Wesl. & Inst. Code ⨐(2001), Fla. Stat. ⨐627.732 (2001), 215 ILCS
105\2 (2001).
14
Regence Direct Policy, Group No [ ], Medical Benefits, Regence Blue Shield, page 56.
15
HCV Guidelines, supra at 31.
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“medically necessary”. Insurance carriers are violating the terms of their insurance contracts by
denying coverage for early treatment of HCV.
Notwithstanding this clear imperative to cover “medically necessary” services consistent
with established medical standards, insurance carriers have falsely cited the HCV Guidelines to
support their denials and withhold treatment to HCV patients with lower fibrosis scores.16
Insurers typically cited the HCV Guidelines to support their policies, which establishes that
insurers also recognize them as the established standard of care for HCV treatment. The HCV
Guidelines prioritization discussion guided the implementation of its recommendation to treat all
HCV patients, and was not intended to abrogate its primary recommendation to treat all
patients.17 Instead, insurers used the HCV Guidelines’ stratification of patients into categories of
risk to deny coverage for treatment of patients not identified in the “highest priority”.18 Use of
the HCV Guidelines to deny treatment to individuals not categorized in urgent need is
unacceptable; early treatment is the only reliable way to prevent a person living with HCV from
developing irreversible liver damage. We are not aware of any other disease or condition where
carriers are permitted to deny coverage for treatment demonstrated to be effective simply
because the patient does not face imminent life-threatening complications or death.
This practice is analogous to providing coverage only in emergency or urgent care
situations. That is not the purpose of insurance; insurance contracts must provide coverage for
all “medically necessary” services, not just “urgent” or “emergency” services. With the
Affordable Care Act (the ACA), insurance contracts require coverage for preventive care—i.e.,
services where by definition there is no current indication of disease. In these HCV cases,
patients have tested positive for a virus not only known to attack and damage the liver, but also,
in a significant percentage of cases, lead to severe complications and death if left untreated or
expensive and difficult interventions, such as liver transplants, if treated at a later stage. Denying
16
In the past, the HCV Guidelines devoted significant discussion to the prioritization for treatment for HCV
treatment based on many factors including the patient’s level of liver fibrosis damage, whether they have been
treated before and specific recommended treatment regimens based on the specific genotype of the patient. While
the HCV Guidelines discussed initiating treatment for those with significant fibrosis as the “Highest Priority” (F3
and F4), and also cited initiating treatment for those with F2 fibrosis as “High Priority,” they now advocate treating
virually all HCV patients, irrespective of degree of liver disease. It is our understanding from speaking with
physicians that insurers have routinely denied coverage for patients not only with F0 or F1 fibrosis of the liver, but
all F2 fibrosis, which the HCV Guidelines previously identified as a group of patients that merited a “High Priority”
for treatment.
17
We believe the HCV Guidelines devoted considerable discussion to which patients should be prioritized for
immediate treatment in part because many liver specialists and large multi-specialty clinics had seen scores of HCVinfected patients over the years who previously chose to forgo prior generation treatments because of their serious
side effects and their relative ineffectiveness, and were waiting for newer, more effective therapies. Those therapies
have now been approved and been proven in thousands of patients who were fortunate enough to get access to these
remarkably effective drugs. With the backlog of patients who can benefit from these new therapies, the HCV
Guidelines provided guidance to those practitioners and liver disease centers about whom to expeditiously prioritize
through testing, screening, counseling about treatment options and treatment . In addition, the HCV Guidelines offer
considerable support for practitioners to educate their patients who urgently need treatment to undergo such
treatment soon.
18
HCV Guidelines, supra at 31.
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services to patients with such a serious disease is unprecedented, and inconsistent with ACA’s
mandate to expand access to preventive medical care.19
In other disease contexts where there is an active and organized patient community, we
believe such denials for curative treatment would never be tolerated (e.g., cancer, heart disease,
HIV/AIDS). We believe such rationing of care to HCV patients is a blatant form of
discrimination and should cease. Given that the HCV Guidelines were updated to provide an
unambiguous recommendation that all HCV patients receive treatment, this is an opportune time
for your Office to act and remind insurers in [INSERT STATE] about their contractual and legal
obligations; insurers must provide coverage to all HCV patients regardless of the extent of their
liver damage, consistent with their insurance contracts, current medical guidance and emphasis
on preventive care found in the ACA.
Insurers continued denial of coverage of medically necessary services in the face of
overwhelming evidence that their actions contradict established medical practice guidelines and
their insurance contracts violates several provisions of section G of the NAIC Model Unfair
Claims Settlement Practice Act, which prohibit:
A) “Knowingly misrepresenting to claimants and insured relevant facts or policy
provisions related to coverages at issue;” . . .
D) “Not attempting in good faith to effectuate prompt, fair and equitable settlement of
claims submitted in which liability has become reasonably clear”;
F) “Refusing to pay claims without conducting a reasonable investigation”; and
L) “Failing in the case of claims denials or offers of compromise settlement to promptly
provide a reasonable and accurate explanation of the basis for such actions”.
E. Commercial Carriers’ Screening Criteria Based on Alcohol Dependence and
Drug Abuse Are Discriminatory, Improper, and Inconsistent with Medical
Practice Guidelines.
Based on our work advocating on behalf of HCV patients, besides restricting access to
these drugs for advanced liver fibrosis cases, we know it is also a common practice for
commercial insurers to require patients document abstinence from alcohol abuse and marijuana
or illicit drug use to establish medical necessity. Skipping over the fallacy of requiring a patient
to prove a negative, this restriction is simply discrimination, unsupported by any medical
evidence. The widespread adoption of this practice recently led the AASLD and IDSA to update
the HCV Guidelines in August 2015 to clarify that:
“Data are lacking to support exclusion of HCV persons from considerations for hepatitis C
therapy based on the amount of alcohol intake or the use of illicit drugs. Based on data
19
Insurance contracts have other exclusions for denying otherwise covered services, such as exclusions for
experimental treatment or exclusions where another insurance coverage is primary. We are not addressing denials
for those other valid contractual reasons but addressing the practice of denying these FDA approved therapies that
have been proven effective for all HCV patient populations on incorrect medical necessity grounds.
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from IFN-based treatment, SVR rates among people who inject drugs are comparable to
those among people who do not inject drugs.”20
The HCV Guidelines were also updated in October to add a section devoted to HCV patients
who use drugs. Among the studies cited, the Guidelines discussed studies that demonstrated
“strong evidence from various setting in which person who inject drugs have demonstrated
adherence to treatment and low rates of reinfection, countering argument that have commonly
been used to limit access to this patient population.”21 The Guidelines state, “Indeed, combining
HCV treatment with needle exchange and opioid replacement programs in this population with a
high prevalence of HCV infection has shown great value in decreasing the burden of HCV
disease.”22 The guidelines also forcefully conclude these restrictions are counterproductive:
“Conversely, there are no data to support the utility of pretreatment screening for illicit
drug or alcohol use in identifying a population more likely to successfully complete HCV
therapy. These requirements should be abandoned, because they create barriers to
treatment, add unnecessary cost and effort, and potentially exclude populations that are
likely to obtain substantial benefit from therapy. Scale up of HCV treatment in persons
who inject drugs is necessary to positively impact the HCV epidemic in the United States
and globally.”
The practice of denying HCV treatment on medical necessity grounds due to lack of documented
sobriety not only has no medical support, but the converse is true; these restrictions harm patients
and will lead to greater spread of HCV in high risk populations.
Alcohol and drug use restrictions is also discriminatory. We are not aware of any other
disease categories where insurers may deny treatment on the basis of alcohol or drug use or
require patients to certify that they abstain from abusing these substances without a strong
medically supported rationale. It is particularly inappropriate with commercially insured
enrollees living with HCV as these patients are purchasing individual coverage, or are
contributing to the costs of their employer-provided coverage through premium contributions.
As a matter of contract law and laws supporting anti-discrimination policies, these patients are
entitled to coverage according to their contracts in the same manner as other patients who abstain
from alcohol and drug use.23
Denying or restricting treatment coverage on the grounds of whether a patient uses
alcohol or drugs with no medical support also violates principles of fundamental fairness and
ethics; HCV patients who are denied treatment continue to live with a damaging virus that can
cause serious harm (including premature death) despite having paid substantial sums for their
20
HCV Guidelines at 18.
HCV Guidelines, supra, October 22, 2015, “When And In Whom to Initiate HCV Therapy, (PDF version) page 7
of 15, located at http://www.hcvguidelines.org/printpdf/91.
22
Id.
23
The NAIC Model Unfair Trade Practices Act, which is largely codified in nearly all states, specifically, prohibits
insurers from “making or permitting any unfair discrimination between individuals of the same class and of
essentially the same hazard in . . . the benefits payable . . . or an in any other manner.” NAIC Model Unfair Trade
Practices Act, Section 3.G(2) (January 2004).
21
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commercial insurance coverage. These individuals deserve—and are contractually entitled to—
the medical benefits they purchased with their hard-earned dollars.
F. Denying Coverage Is a Short-term Attempt at Avoiding Costs that, in the Long
Run, Will Increase Overall Healthcare Expenditures.
While insurance carrier denials do not always cite cost as the reason for denying
otherwise medically necessary services, it has been widely reported that insurers are using these
restrictions principally to combat the perceived high cost of these revolutionary drugs.24
America’s Health Insurance Plans AHIP—the largest industry association representing insurance
carriers in lobbying and public policy debate—led a high profile media campaign citing the high
cost of these new Hepatitis C drugs.25 AHIP has influenced the media to habitually cite the initial
list price for one of these drugs (Sovaldi) in almost all media articles discussing the new
Hepatitis C breakthrough therapies (i.e., $1,000 per pill or $84,000 for a 12-week course of
treatment for Sovaldi). 26 However, as your Office is no doubt aware, insurance carriers never
pay the list price for medications; the actual cost is heavily negotiated by pharmacy benefit
managers, who are typically sophisticated national players with billions in revenues and profits.
While the actual negotiated price paid by an insurance carrier or PBM is confidential and is a
closely guarded secret, we know from public sources that the actual price for the new HCV
treatments is heavily discounted. Early in 2015, one of the manufacturers for the leading HCV
drugs—Gilead— publicly reported its average discount on HCV drugs as approximately 46%.27
Notwithstanding that drug affordability is a major public policy concern, insurance
carriers may not deny coverage for otherwise medically necessary drugs that are effective simply
based on cost. Denying care to HCV patients is not the solution to escalating drug prices for
innovative new therapies, and employing such a strategy to ration care for HCV patients illegally
discriminates against these individuals.28 Insurers routinely cover very expensive treatment with
marginal medical benefit for other disease categories; numerous articles discuss industry
complaints about expensive chemotherapy agents that show little or no additional benefit over
existing therapies or new drugs that simply extend the life of cancer patients on average a few
weeks or months.29 Here, the benefit of HCV treatment is very clear—it results in a cure for
See e.g., “Hepatitis C: Weighing the Price of a Cure,” by John Watson, MEDSCAPE GASTROENTEROLOGY,
May 21, 2015; “Examining Hepatitis C Virus Treatment Access: A Review Of Select State Medicaid Fee for
Service and Managed Care Programs,” Center for Health Law and Policy Innovation at Harvard Law School,
available at http://www.chlpi.org/wp-content/uploads/2013/12/Examining_HCV_Treatment_Access_Report.pdf.
25
See e.g., “The Unanswered Question of High Cost Drugs,” posted on April 21, 2015 by Alicia Caramenico,
located on AHIP’s website at: http://www.ahipcoverage.com/?p=15637.
26
See e.g., “$1,000 Pill For Hepatitis C Spurs Debate Over Drug Prices,” NPR, by Richard Knox, December 30,
2013; “Critical Reports Mount On Hepatitis C Pill Costs”, FORBES, by Bruce Jaspan, March 17, 2015; “Insurers
Worry That $84,000 Hepatitis C Drug Sovaldi Could Break the Bank,” By Jose Luis-Gonzalez (Reuters), FORBES
May 28, 2014.
27
See e.g., “Gilead to Discount its Pricey Sovaldi Drug,” by Russ Britt, MARKETWATCH, February 4, 2015.
28
See NAIC Model Unfair Trade Practices Act, Section 3.G(2) (January 2004).
29
See, e.g., “Expensive Cancer Drugs With Modest Benefit Ignite Debate Over Solutions”, Gunjan Sinha, JNCI J
Natl Cancer Inst., Volume 100, Issue 19, pp. 1347-1349, Sept. 23, 2008; “Dealing with High-Priced Cancer Drugs –
A Disruptive Perspective,” Spencer Nam, Clayton Christiansen Institute For Disruptive Innovation, Nov. 24, 2014
(at http://www.christenseninstitute.org/dealing-with-high-priced-cancer-drugs-a-disruptive-perspective).
24
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anywhere from 95-100% of patients who take the medication, with little in side effects, plus the
added benefit of preventing further liver damage and complications from living with chronic
liver disease – and preventing further transmission.
G. New HCV Therapies Are, in Fact, Cost-Effective for All HCV Patients
Even considering the cost of these therapies, recent independent studies30 that are based
on conservative assumptions have concluded these new treatments are cost-effective compared
to older, less effective therapies and more effective than delaying treatment until patients
experience greater liver damage. 31 The California Technology Assessment Forum concluded,
based on information from the Institute for Clinical and Economic Review (ICER), regarding
one of these treatments (marketed with the trade name Harvoni):
[ICER’s] cost-effectiveness analysis found that, at a 12-week cost of $94,500, LDV/SOF
regimens for treatment-naïve and treatment-experienced patients met commonly accepted
thresholds of $50,000-$100,000 per additional quality-adjusted life year gained. A strategy
of treating patients at all fibrosis stages rather than waiting to treat patients until they
reached fibrosis levels F3 or F4 also met commonly accepted cost-effectiveness thresholds
[emphasis added].32
Even at published list prices (which are not what insurers are paying for these treatments)
the new HCV treatments are cost-effective. The IDSA and AASLD also recently added a section
in the HCV Guidelines discussing the general cost effectiveness of treating HCV patients who do
not have advanced fibrosis; they cite numerous studies, including those referenced in this
whitepaper, demonstrating such treatment is cost-effective.33
These study results are not surprising given that the price of these breakthrough therapies
pales compared to these patients’ reduced mortality, significant decline in quality of life, and the
exorbitant costs for treatment of HCV patients who develop cirrhosis and need liver transplants
and patients who develop liver cancer and need expensive cancer therapies. While not all HCV
See, e.g., “Hepatitis C Treatments are Cost Effective, but Affordability is Another Matter,” Ed Silverman, WSJ,
March
17,
2015
(at
http://blogs.wsj.com/pharmalot/2015/03/17/hepatitis-c-drugs-are-cost-effective-butaffordability-is-another-matter/).
31
See, e.g., “Cost-effectiveness of hepatitis C treatment for patients in early stages of liver disease”, Leidner AJ,
Chesson HW, Xu F, Ward JW, Spradling PR, Holmberg SD, HEPATOLOGY, 2015 Jun;61(6):1860- (The authors
concluded that “Immediate treatment of HCV-infected patients with moderate and advanced fibrosis appears to be
cost-effective, and immediate treatment of patients with minimal or no fibrosis can be cost-effective as well,
particularly when lower treatment costs are assumed.”); see also “Cost-Effectiveness and Budget Impact of
Hepatitis C Virus Treatment with Sofosbuvir and Ledipasvir in the United States,” Jagpreet Chhatwal, PhD; Fasiha
Kanwal, MD, MSHS; Mark S. Roberts, MD, MPP; and Michael A. Dunn, MD, March 17, 2015, ANNALS
INTERN MEDICINE (concluding that new therapies were cost-effective compared to older less effective therapies
for over 80% of patients even assuming full list prices for the new drugs).
32
“The Comparative Clinical Effectiveness and Value of Novel Combination Therapies for the Treatment of
Patients with Genotype 1 Chronic Hepatitis C Infection: A Technology Assessment Final Report,” January 30,
2015, completed by Institute for Clinical and Economic Review, page 6.
33
HCV Guidelines, supra at 48-53.
30
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patients will face these dire consequences due to continued progression of their HCV infection, a
significant percentage do. This does not even consider the cost to society and the impact on
these patients’ loved ones. When you factor in the benefit of preventing further transmission of
HCV by eliminating the virus in all people living with HCV, the need to provide access to early
treatment to halt this epidemic becomes obvious.
H. Restricting Access to Effective Treatment for HCV is Discriminatory
So why are these denials of medically beneficial and cost-effective treatments tolerated?
Many in the patient advocacy community believe that insurers have been able to get away with it
because of the widespread bias and discrimination against the population of patients most at risk
of HCV infection. Absent an organized constituency that garners public sympathy, insurance
carriers have been permitted to restrict access to treatment to HCV patients who face imminent
harm.
Can you imagine if after billions of dollars in cancer research, a new treatment was
discovered that would cure nearly 100% of patients diagnosed with breast cancer? What would
the public outcry be if insurance carriers sought to restrict treatment based on cost concerns only
to stage 3 or 4 breast cancer patients who face imminent threat of serious harm or death? One
would expect the public outcry to be deafening, with numerous federal and state investigations,
congressional hearings and scathing news stories and documentaries. Advocates who work in
the HCV patient community routinely discuss the lack of an organized and publicly sympathetic
patient population demanding treatment that allows such discriminatory policies and practices to
persist. We believe such practices are unjust and while they may not have entered the public
consciousness, they should not be permitted as a matter public policy.
As a matter of law, withholding of effective treatment scientifically proven for one class
of patients because of their status, but providing similar benefits to other similarly situated
patients constitutes illegal discrimination.34 Carriers do not routinely deny medically beneficial
drugs to patients in other disease categories because their condition is not urgent or that the harm
is not yet serious. HCV patients deserve better treatment – they deserve equal access to benefits.
I. Delaying Treatment Inappropriately Shifts Costs to Medicare
The inevitable result of private insurers delaying coverage for treatment is that many
patients will only qualify for coverage of their HCV treatments, whether it be these newer
medications or liver transplants, once they are covered by Medicare. Milliman—a widely
respected national professional actuarial firm—recently concluded a study of the question of the
impact on the Medicare program because of commercial insurers’ denying coverage for HCV
patients with early-stage fibrosis. Their study concluded that if commercial insurers covered
early treatment, Medicare would save billions of dollars in avoided medical costs and an
additional 50,000 patients’ lives would be saved as compared to denying treatment until patients
suffer additional liver scarring and are covered under Medicare.35 This conclusion held true even
34
35
NAIC Model Unfair Trade Practices Act, Section 3.G(2) (January 2004).
“Aging Will Affect Medicare’s Hepatitis C Mortality and Cost”, July 2015, Milliman.
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when considering that HCV patients would live longer lives after early treatment and would
incur additional healthcare costs unrelated to their cured HCV infection.
This cost shifting to taxpayer-supported public programs is not an appropriate public
policy, especially because of the expanded consumer market available to insurers delivered by
the ACA. It is not fair (and we think illegal) to deny coverage for HCV patients who paid
thousands in annual premiums for the peace of mind of obtaining coverage for their needed
medical care.
J. Restricting Access to HCV Treatment Undermines the Public Health
Imperative to Identify, Treat, and Cure HCV Patients
HCV infection is a serious and growing epidemic. Millions of US and thousands of
[INSERT STATE] residents are living with HCV, which is a leading cause of liver cancer and
the leading cause of liver transplants. Increased transmission of HCV among young adults has
been reported in at least 30 states.36 The CDC reports that recently the death rate due to HCV
has overcome the death rate of HIV/AIDS in the United States.37
We now have a way to combat this serious epidemic via widespread screening and
treatment with these remarkably effective new curative therapies. The CDC and USPSTF
recommend that all baby boomers born between 1945 and 1965 and certain people within certain
high-risk categories be screened for HCV.3839 There are numerous efforts around the country to
promote the screening and treatment of HCV treatment to stem the tide of this serious viral
disease.
The CDC recently funded three community organized initiatives to identify patients
infected living with HCV.40 These initiatives share a common goal to increase outreach efforts
to promote awareness of the disease, to screen individuals considered at high-risk of harboring
the virus and to link these patients to providers for treatment and cure. 41 By testing and treating
patients with HCV, the hope is to halt the continued spread of the disease and eventually
eliminate HCV in the population.42
36
Suryaprasad AG, White JZ, Xu F, Eichler BA, Hamilton J, Patel A, Hamdounia SB, Church DR, Barton K, Fisher
C, Macomber K, Stanley M, Guilfoyle SM, Sweet K, Liu S, Iqbal K, Tohme R, Sharapov U, Kupronis BA, Ward
JW, Holmberg SD. Emerging Epidemic of Hepatitis C Virus Infections Among Young Nonurban Persons Who
Inject Drugs in the United States, 2006-2012. Clin Infect Dis 2014. PMID: 25114031.
37
“Hepatitis C Linked to More Deaths than HIV,” Yael Waknine, MEDSCAPE MEDICAL NEWS, February 21,
2012.
38
See the CDC’s Testing Recommendations for Chronic Hepatitis C Virus Infection at
http://www.cdc.gov/hepatitis/hcv/guidelinesc.htm.
39
See USPSTF Screening for Hepatitis C Virus Infection in Adults at
http://www.uspreventiveservicestaskforce.org/Page/Document/RecommendationStatementFinal/hepatitis-cscreening
40
See Center for Disease Control and Prevention website, last updated May 31, 2015,
http://www.cdc.gov/hepatitis/partners/communitybasedhepcprogs.htm.
41
Id.
42
See e.g., 2014 Washington State Hepatitis C Strategic Plan, August 2014, Washington State Department of
Health, page 5.
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For example, the Washington State Department of Health (WA DOH) was commissioned
by the Washington State Legislature in 2014 to update their strategic plan to address this serious
chronic disease. They issued a report in August 2014 to address three primary areas: 1)
“Identify people with hepatitis C, link them to care, and get them to a cure”; (2) “Prevent new
infections” and 3) Strengthen data systems and increase data use.”43 The WA DOH plan
concludes with a call to action to implement their recommendations:
“The sooner we act:
 the more people with long-standing infection we will save from life-threatening
disease and death;
 the sooner we see returns on our investments in public health
 the more new infections we will avert so another generation is not impacted by
disease; and
 the sooner we can eliminate hepatitis C in Washington.”
That we are spending millions of dollars to identify patients with chronic HCV, only to
discover insurers are routinely denying coverage for their curative treatment is ironic and callous.
The barriers to care for HCV patients posed by commercial carriers contradict established
medical practice guidelines, violate their contracts and contravene public policy.
Now is the time to act. We would welcome the opportunity to partner with your Office
and educate the insurance community about why we need to halt the continued transmission of
HCV, which eventually saves lives, improves the quality of life for patients and their loved ones,
and prevents further healthcare expenditures eventually by eliminating this disease as a public
health threat.
Thank you in advance for your attention to this critical matter on behalf of [INSERT
STATE] residents living with hepatitis C.
43
2014 Washington State Hepatitis C Strategic Plan, Washington State Department of Health, page 5.
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