The state’s Medicaid program announced Thursday it is lifting restrictions that prevented many patients from getting powerful drugs that can cure hepatitis C, after negotiating new discounts from two manufacturers.
The changes at MassHealth, as the program is known, take effect Aug. 1.
The agreement lowers the cost of three brands of a new class of drugs that are highly effective against the liver-destroying virus — but are also very expensive.
Medicaid programs around the nation have struggled to pay for the drugs, and most states have refused to cover them unless patients already suffered severe liver damage. But court challenges and pressure from advocates and the federal government are starting to turn the tide. Massachusetts is among 10 states, including Connecticut, Maine, and New York, that have lifted restrictions on access to the drugs or are in the process of doing so.
With the restrictions gone, more MassHealth enrollees will get treatment — more than 3,400 expected in the fiscal year that starts Friday. But because of the lower prices they negotiated, state officials said that expenditures on hepatitis C would not increase, holding steady at $200 million for the year.
The move prompted words of praise from Andy Slavitt, acting administrator for the Centers for Medicare & Medicaid Services, which notified Medicaid directors in November that the law required Medicaid to cover the drugs.
“We appreciate the leadership that Governor [Charlie] Baker and the Commonwealth of Massachusetts have demonstrated in taking these actions,” Slavitt’s statement said. “We are pleased by these steps and are eager to work with a number of other states to follow a similar path.”
The decision was also greeted with jubilation among advocates.
“That is fantastic news,” said Dr. Camilla S. Graham, an infectious disease specialist who treats many hepatitis C patients at Beth Israel Deaconess Medical Center, when a reporter told her of the state’s action.
“This is a very big deal for patients in Massachusetts.”
The current system has required her often to tell patients they could not get treatment until their livers were badly damaged.
By that point, even after being cured of the virus, such patients faced a lifelong risk of liver cancer and would need twice-yearly screening tests.
“It was such a terrible thing to have to say to somebody,” Graham said.
Robert Greenwald, director of Harvard Law School’s Center for Health Law and Policy Innovation, said, “This is a great day for low-income people living with” hepatitis C. A suit by Greenwald’s organization against Washington state led to a federal district court decision in May ordering that state to start covering the drugs regardless of the condition of the patient’s liver.
The list prices for the new generation of hepatitis C drugs, known as direct-acting antivirals, range from $54,600 to $94,500 for a 12-week course of treatment, but Medicaid programs and insurers negotiate discounts that are not disclosed. MassHealth recently launched negotiations to wrest even lower prices, which come in the form of rebates.
As a result, MassHealth will cover Harvoni, a drug from Gilead Sciences, for 80 percent of its members who are infected with hepatitis C. About 20 percent of MassHealth members will have access to another Gilead drug, Sovaldi, or to Bristol-Myers Squibb’s drug Daklinza.
Several other drugs in the same class are available, including a new one approved Tuesday. But Graham said that the three drugs covered by MassHealth will cure the vast majority of people with hepatitis C, a virus transmitted through the blood, most often when intravenous drug users share needles.
Marylou Sudders, secretary of the Executive Office of Health and Human Services, said in a statement the goal “is to ensure a sustainable, cost-effective approach to covering MassHealth members who need treatment for hepatitis C infection. . . . We will continue to push drug companies to give us the very best prices on new treatments as they come on the market.”
Currently, about one-third of MassHealth enrollees are eligible for the hepatitis C drugs without restrictions. But the two-thirds who obtain their MassHealth coverage through a private insurer are often denied.
These insurers will pay for the drugs only for patients whose livers are severely damaged, and some also require visits to specialists and evidence of sobriety.
Effective Aug. 1, MassHealth will require the insurers to eliminate those restrictions.
Eric Linzer, spokesman for the Massachusetts Association of Health Plans, said insurers have few details but praised MassHealth’s action as “an important step to rein in the high cost of these drugs.”
MassHealth, which pays for health care for more than 1.85 million low- and moderate-income people and people with disabilities, negotiated the rebates with Gilead after state Attorney General Maura Healey warned the company in January that it faced possible legal action unless it lowered the price of Harvoni and Sovaldi.
The attorney general is trying to get discounts for other sectors of state government that serve thousands of residents but aren’t eligible for the MassHealth rebates.
Her office is negotiating for better prices for the state Office of Pharmacy Services, which purchases medicines for the Department of Corrections, the Department of Public Health, the Department of Mental Health, and state hospitals.
Massachusetts has become a focal point in the growing backlash against soaring prescription drug prices, which can run tens of thousand of dollars a year for mass market medicines and hundreds of thousands a year for rare disease therapies.
In addition to Healey’s efforts with Gilead, state Senator Mark C. Montigny, a New Bedford Democrat, has proposed sweeping provisions to rein in drug prices. And a Boston watchdog group, the Institute for Clinical and Economic Review, is working on frameworks for pricing medicines based on their value to patients.