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10 ADAP client enrollment and client utilization reached their highest levels during FY2010. However, as a result of the national fiscal crisis and implementation of cost-containment measures, including the disenrollment of clients from ADAPs, client enrollment decreased in December 2010 compared to June ADAPs provided medications to 127,998 clients across the country in December Client utilization remained relatively level between June 2009 and December 2010, increasing by 2%. Client utilization decreased by 2% between June 2010 and December Twenty-two states (46%) experienced a decrease in client utilization over this time period; 25 states (52%) reported a stabilization or increase in client utilization. Client utilization reported for December 2010 could show a slight decrease as a result of holiday closings in state government. 10
11 ADAP drug expenditures were $146,457,975 in June 2010, ranging from a low of $19,348 in New Mexico, which heavily relies on insurance purchasing for client coverage, to a high of $37 million in California. Ten states accounted for 76% of all drug spending; five states (California, New York, Texas, Puerto Rico and Florida) accounted for over half (57%) of all drug spending. Drug spending by ADAPs has increased more than nine-fold (898%) since 1996 (among the same 46 states reporting data in both periods), almost three times the rate of client growth over this same period (333% increase between 1996 and 2010). Between June 2009 and June 2010, drug expenditures grew 16%. Reasons for this include increasingly complex drug regimens, clients remaining on ADAPs longer and transitioning to more costly drug regimens and treatment of co-morbidities. 11
12 The average monthly cost per client served by ADAP was $949 in June This represents a 5% decrease in average monthly cost per client since June 2009 ($995). Estimated annual per client expenditures were $11,388. In states that purchase via a pharmacy network (rebate) model, average monthly cost per client does not include rebates on expenditures, which would reduce the cost paid for prescriptions and, therefore, the average cost per client. States must actively file for rebates with manufacturers on past drug purchases. This estimate is based on annualizing June 2010 average monthly cost per client. It is important to note that June 2010 expenditures may not be representative of monthly expenditures overall. 12
13 In June 2010, the average expenditure per prescription was $325, compared to $302 in June 2009, representing an 8% increase. Average expenditures per prescription was significantly higher for antiretrovirals ($491) than non-antiretrovirals ($67 for A1 OIs and $64 for all other drugs). ADAPs filled a total of 451,148 prescriptions in June 2010, representing an increase of 8% compared to June 2009 (416,590 prescriptions filled). 13
14 Most ADAP drug spending is on FDA-approved HIV antiretrovirals (91% in June 2010). The 31 A1 drugs highly recommended for the prevention and treatment of HIV-related opportunistic infections (OIs), accounted for 2% of expenditures and 9% of prescriptions. All other drugs (including medications for depression, hypertension, and diabetes), accounted for 6% of drug expenditures, but 31% of prescriptions filled. 14
15 ADAPs investment in insurance purchasing and continuation and wrap-around of existing public payers increased in June A subset of overall drug expenditures, ADAP payment of co-payments increased to 5% of overall drug purchases (from 1% in June 2009). In June 2010, 21% of all prescriptions filled were co-payment expenditures (from 8% in June 2009). 15
16 The federal 340B Drug Discount Program, authorized under the Veterans Health Care Act of 1992, enables ADAPs to purchase drugs at or below the statutorily defined 340B ceiling price, which all ADAPs do. ADAPs may purchase drugs directly from wholesalers at 340B prices ( direct purchase ADAPs ), through retail pharmacy networks at a higher than 340B price ( rebate ADAPs ), or as a direct purchase state that utilizes an existing entity (e.g., University Hospital) to purchase and distribute ADAP drugs ( hybrid ADAPs ). For rebate states, ADAPs then submit rebate requests to drug manufacturers, maintaining compliance with the 340B price requirement. Direct purchase ADAPs can also choose to participate in the HRSA Prime Vendor Program created by the federal government to negotiate pharmaceutical pricing below the 340B price. Twenty-four ADAPs reported purchasing directly from wholesalers, 16 also participated in the HRSA Prime Vendor Program. Twenty ADAPs reported purchasing through a pharmacy network and then seeking rebates. Five ADAPs reported purchasing through a hybrid model. NASTAD s ADAP Crisis Task Force negotiates directly with manufacturers for pharmaceutical pricing below the 340B price on behalf of both rebate and direct purchase ADAPs. When such agreements are reached, they are provided to all states. There are currently agreements in place with all manufacturers of antiretroviral medications and with several other companies that manufacture other high-cost medications. In May 2010, recognizing the unique status of ADAPs and the need to provide new supplemental discounts to ensure ADAP prices were below the new, lower 340B prices, antiretroviral manufacturers worked with the ADAP Crisis Task Force to reduce ADAPs antiretroviral costs by an additional $160 million annually beginning July Many of the agreements also include price freezes. The cumulative savings of the Task Force agreements, from 2003 to 2010, totals more than $1.2 billion. NASTAD provides logistical support to the Task Force. 16
17 The Ryan White Program allows states to use ADAP earmark dollars to purchase health insurance and pay insurance premiums, co-payments, and/or deductibles for individuals eligible for ADAP, provided the insurance has comparable formulary benefits to that of the ADAP., States are increasingly using ADAP funds for this purpose. Forty ADAPs reported using funds for insurance purchasing/continuation in 2010 representing $194 million in estimated expenditures in FY2010. ADAPs reported spending over $15 million on insurance purchasing/continuation in June
18 In June 2010, 110,338 ADAP clients were served by such arrangements. Clients served through insurance coordination more than tripled since June 2009 (31,291 clients served). Spending on insurance purchasing/continuation represented an estimated $139 per capita in June 2010, about 15% of the average monthly cost per client, based on drug expenditures, in that month ($949). 18
19 In March 2010, President Obama signed into law the Patient Protection and Affordable Care Act (PPACA). The passage of health reform will extend health insurance coverage to many uninsured persons living with HIV/AIDS, but a majority of these insurance opportunities will not exist until 2014 when Medicaid expansion and insurance exchange implementation take effect. In an effort to help certain uninsured individuals obtain coverage prior to 2014, the health reform bill included provisions that the Secretary of Health and Human Services (HHS) establish a Pre-existing Condition Insurance Plan (PCIP) by July 1, Individual states were given the option to establish a state administered PCIP or default to the option of having uninsured populations served under the federally administered PCIP. Some ADAPs have experienced barriers to coordinating with PCIPs, including the need to establish the infrastructure necessary to coordinate with the PCIP and that the PCIP in their state prohibits third-party payers. As of December 2010, 12 ADAPs reported having the ability to enroll clients in PCIPs and 11 of those states had 151 clients enrolled with plans to continue enrolling additional clients. The average monthly cost per client served in a PCIP was $529 in December 2010, approximately 56% of the annual average cost per client, based on drug expenditures ($949) in that month. 19
20 In calendar year 2010, approximately 13% of ADAP clients were also Medicare-eligible (representing about 15,000 clients served). A subset of these clients were dually eligible for both Medicare and Medicaid. PPACA also included a provision that allows ADAP expenditures made on behalf of a Medicare Part D beneficiary to count towards the True Out of Pocket Costs (TrOOP) calculation, which allows clients to move through the donut hole and into catastrophic coverage. This provision went into effect on January 1, To meet the federal requirements and maintain appropriate medication coverage for their clients, 53 ADAPs have developed policies to coordinate with the Part D benefit. As of February 2011: 21 ADAPs pay Part D premiums for ADAP clients eligible for Part D; 44 ADAPs pay Part D deductibles for ADAP clients eligible for Part D; 36 ADAPs pay Part D co-payments for ADAP clients eligible for Part D; 36 ADAPs pay for all medications on their ADAP formularies when their Part D clients reach the donut hole. Now that ADAP expenditures count toward TrOOP, this allows clients to reach Part D catastrophic coverage and thus no longer solely rely on ADAP for the remainder of each calendar year. 20
21 In order for ADAP contributions to count toward clients TrOOP calculations, ADAPs must accurately transmit data to the Center s for Medicaid and Medicare (CMS). Twenty-six ADAPs reported signing a data sharing agreement with CMS in December Twenty-three ADAPs, including 9 who do not have a data sharing agreement with CMS, have a data sharing agreement with at least one other entity, including Medicaid, Medicare, private insurance providers, and other entities (e.g. Pharmacy Benefits Managers). 21
22 22
23 Millions of Americans are at risk for hepatitis A virus (HAV), hepatitis B virus (HBV) and hepatitis C virus (HCV) infection and millions more are living with chronic viral hepatitis. In 2008 alone, there were an estimated 22,000 new HAV infections, 38,000 new HBV infections and 18,000 new HCV infections in the United States. It is estimated that there are 1.4 million Americans living with chronic HBV and 3.9 million Americans living with chronic HCV. Due to the absence of a national chronic viral hepatitis surveillance system, it is believed that these estimates are much lower than the actual burden of disease. While both HAV and HBV are vaccine-preventable and there exist longstanding recommendations to vaccinate at-risk adults, coverage rates among adult populations such as gay/bisexual and other men who have sex with men (MSM), persons who inject drugs (IDU) and persons living with HIV remain low. These low vaccination rates are alarming as millions of Americans remain needlessly unvaccinated and susceptible to disease. Also alarming are statistics which indicate that up to one half of Americans infected with HBV are unaware of their status, and three quarters infected with HCV are unaware of their status. 23
24 It is estimated that up to 15 percent of people living with HIV are co-infected with HBV, and up to 30 percent are co-infected with HCV. Further, viral hepatitis is the leading cause of non-aids-related death in people co-infected with HIV and viral hepatitis. Co-infection increases the progression to liver disease and can occur without symptoms. 24
25 Coverage of viral hepatitis services for persons living with HIV is allowable through the Ryan White Program and ADAP. Some services (e.g., testing) are allowable through Ryan White clinical services and access to HAV/HBV vaccines and HBV/HCV drugs are allowable expenditures through ADAPs for co-infected individuals. Coverage varies across the country as states determine what services, vaccines and drugs are included on the ADAP formulary. While it is important to assess, monitor and treat viral hepatitis in co-infected persons, not all states currently include HAV/HBV vaccine or HBV/HCV drugs on their ADAP formularies. Twenty-two states provide HAV/HBV vaccines, 25 states provide at least one medication for HBV and 22 states provide at least one medication for HCV. Equally important is the coverage of diagnostic testing to diagnose viral hepatitis infection and to monitor disease progression and treatment outcomes. Only seven states cover at least one type of viral hepatitis diagnostic service through ADAP. 25
26 There are several reasons states may not include viral hepatitis vaccines and medications. Given state budget constraints and the current ADAP crisis, some jurisdictions have not provided viral hepatitis services and/or included HBV/HCV drugs on their formularies. In some jurisdictions, as a method of cost containment, viral hepatitis medications have been removed from the ADAP formulary. Finally, some states have not provided viral hepatitis services and medications because the demand from providers and persons living with HIV/AIDS has not warranted it. 26
27 For states with viral hepatitis services covered through the Ryan White Program and ADAPs, there has not been a substantial uptake in utilization of the HAV/HBV vaccine and HBV/HCV drugs. This is due to a number of factors, including a general lack of understanding of viral hepatitis among health care providers and persons at risk of coinfection. However, AIDS Education and Training Centers (AETCs) are working to educate HIV-treating clinicians about the importance of evaluating and treating co-infected patients. Providers have also indicated that accessing the HAV/HBV vaccine through the ADAP pharmacy, as opposed to in the clinic, makes it difficult to deliver this important preventive vaccine. It can be challenging for persons with underlying mental health or substance use issues to undergo HCV treatment, which often exacerbates existing mental health complications. Some clinicians are resistant to treat HCV in co-infected persons due to the need for increased case management and support for these patients. In addition, some clinicians and patients are monitoring HCV progression and waiting for new therapies to become available. New treatments present similar side effects that must be managed and will have to be added into the existing standard of care of HBV/HCV drugs. 27
28 The Centers for Disease Control and Prevention recommend that persons living with HIV should receive the following viral hepatitis services: Testing for hepatitis B Testing for hepatitis C Vaccination against hepatitis A Vaccination against hepatitis B (if susceptible) 28
29 There are many drugs undergoing development that, once approved, will improve current HBV and HCV therapies. The majority of development has focused on improving HCV treatment. Two new direct-acting antivirals (protease inhibitors) are in the immediate pipeline. The two new drugs are telaprevir (Vertex Pharmaceuticals) and boceprevir (Merck). The two new drugs, telaprevir (Vertex Pharmaceuticals) and boceprevir (Merck), are expected to significantly increase HCV cure rates from 40 percent to as high as 80 percent and decrease treatment duration from 48 weeks to 24 weeks. Telaprevir and boceprevir are expected to become available in May 2011 for treatment of HCV mono-infection only. Approval of these treatments in co-infected persons is also expected at a later date. 29
30 Given that the majority of drug development data focuses on mono-infection, data on drug safety, efficacy and tolerability, including drug resistance and drug interactions of new HCV drugs with current HIV drugs, is currently limited. While telaprevir and boceprevir show great promise for persons living with mono- or coinfection of HCV, it is important to note that they must be used in combination with the current standard of care for HCV which includes pegylated interferon and ribavirin. ADAPs that choose to provide these new treatments, therefore, will need to continue to cover these existing therapies. 30
31 Even with the approval of these new medications, successful treatment of HCV will continue to be fairly complex. Drug effectiveness can be limited by a number of factors including the person s genetics, the type of genotype or subtype of HCV, drug contraindications and the potential for drug resistance. As well, new treatments must be closely managed to ensure adherence as they may present new side effects such as anemia, rash and depression that will be in addition to the side effects caused by medications in the current standard of care. While these new treatments hope to change the HCV treatment paradigm, new treatments will also likely pose new challenges. For more information, please see the Treatment Action Group s 2011 Hepatitis C Treatment Pipeline Report. 31
32 Hepatitis B medications available on ADAP formularies include Adefovir Dipivoxil (Hepsera), Entecavir (Baraclude), Interferon Alfa-2b (Intron A), Lamivudine (Epivir-HBV, Zeffix, Heptodin), Peginterferon alfa-2a (Pegasys) and Telbivudine (Tyzeka, Sebivo). In December 2010, 25 ADAPs covered at least one of these medications for HBV on their formularies. ADAPs filled 461 hepatitis B treatment prescriptions for 209 clients in December In FY2009, ADAPs filled 5,250 prescriptions. 32
33 HCV is classified as an HIV-related opportunistic infection, due to the relatively high coinfection rate of HIV and HCV. Because there is no national funding source specifically for HCV treatment, most of the burden for treating co-infected patients has fallen on ADAPs and other Ryan White programs. Hepatitis C medications available on ADAP formularies include Interferon Alfa-2b (Intron A), Recombinant Interferon Alfa-2a (Roferon), Consensus Interferon (Infergen), Peginterferon Alfa-2a (Pegasys), Peginterferon Alfa-2b (PEG-Intron) and Recombinant Interferon Alfa-2a (Roferon) and Ribavirin. In December 2010, 23 ADAPs covered at least one of these medications for HCV on their formularies, compared to 31 ADAPs in June ADAPs filled 228 hepatitis C treatment prescriptions for 144 clients in December In FY2009, ADAPs filled 2,336 prescriptions. 33
34 The hepatitis A and B vaccines are recommended for those at high risk for and living with HIV. Twenty-two ADAPs covered the hepatitis A and B combination vaccine in December Twenty-seven ADAPs covered this vaccine in June Twenty-one ADAPs covered the hepatitis A vaccine in December Twenty-six ADAPs covered this vaccine in June Twenty-one ADAPs covered the hepatitis B vaccine in December Twenty-six ADAPs covered this vaccine in June
35 35
36 ADAPs continue to experience consistent increases in client enrollment and utilization. During FY2009, ADAP client enrollment increased over the previous fiscal year by an unprecedented average of 2,806 new clients per month. Between June 2009 and June 2010 ADAP client enrollment increased 10,302. In June 2010, ADAPs provided medications to 135,596, an 8% increase in client utilization over June ADAPs typically have more individuals enrolled in a given month than are served; in June 2010, ADAPs provided medications to 76% of the 179,009 enrolled individuals (a two percent increase of utilization vs. enrollment over the previous year). 36
37 In FY2010, the national ADAP budget climbed to $1.79 billion, a 13% increase from FY2009. The federal appropriation in FY2010 to ADAP increased by $20.6 million from FY2009. ADAP earmark funding to states comprised less than half (45%) of the total ADAP budget in FY2010; the earmark has been declining as a share of the total budget since 2000 when it peaked at 68% of the total. In order to fill the gaps resulting from nearly stagnant federal ADAP earmark funding and other constantly shifting funding streams, ADAPs relied more heavily on state general revenue contributions and increased rebates and discounts from pharmaceutical manufacturers to maintain their programs. 37
38 In June 2010, ADAP client utilization (135,607 clients in June 2010) and prescriptions filled (451,148 prescriptions in June 2010) increased by 8% over June ADAP drug expenditures totaled $147.2 million in June 2010, an increase of 16% over June ADAPs dispense approximately 3.3 prescriptions per month to clients, a number that has remained stable since June ADAPs are now experiencing an estimated additional $160 million of annualized supplemental discounts and rebates on drug costs as a result of ADAP Crisis Task Force negotiations held in May
39 ADAPs are investing more heavily in health insurance purchasing and continuation which is cost-effective for the programs and provides comprehensive health benefits to clients, rather than only providing medications to clients. ADAPs generally purchase and/or continue insurance for clients through private insurers, state high-risk insurance pools, and other plans such as Pre-Existing Condition Insurance Plans (PCIPs). The extent to which ADAPs can purchase or maintain insurance coverage for people with HIV/AIDS depends on state and federal insurance law and health reform; ADAPs capacity to develop and manage such programs; and the availability of resources for these purchases. ADAPs anticipate expending $194 million (11% of the national ADAP budget) in FY2010 purchasing and/or continuing individuals health insurance, representing an estimated20% increase over FY2009. Client utilization of health insurance purchasing and continuation in June 2010 grew 254% compared to June
40 Throughout FY2010, ADAPs found themselves in the eye of the perfect storm: minimal increases in federal appropriations and fluctuations in state funding, increased program demand due to unemployment and other economic challenges, heightened national efforts on HIV testing and linkages into care, high drug costs, and new HIV treatment guidelines calling for earlier therapeutic treatments. These collective stressors contributed to a fiscal tipping point for ADAPs from which recovery will continue to be difficult. As more individuals turn to ADAP, programs will need to assess the feasibility of keeping their doors open and providing continuous services to those already enrolled. ADAPs must also continue to focus on establishing program efficiencies to create long-term program sustainability, implementing effective cost-containment measures, and coordinating with other payers to ensure payer of last resort requirements. 40
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