D espite Medicare’s mandate that Part D insurance plans cover antiretroviral therapies (ART) and preexposure prophylaxis (PrEP), high drug prices mean that patients face out-of-pocket costs of $3,000 to $4,000 annually under a standard benefit, according to Chien-Wen Tseng, MD, MPH, a physician-researcher with the University of Hawaii School of Medicine and first author of a national analysis published in JAMA Network Open. “Such cost-sharing indicates that for beneficiaries, affordable access to ART or PrEP may depend on them receiving taxpayer subsidies to lower out-of-pocket costs,” she says.
Assessing How Costs Are Divided
Dr. Tseng and colleagues assessed how costs for the drugs are divided among patients, payers, the government, and drug makers for 1 year of ART or PrEP. Those calculations can be notoriously complex, which means cost sharing for these drugs and in these populations has historically been difficult to discern.
Medicare Part D, which covers 70% of Medicare beneficiaries, imposes cost-sharing among patients, insurers, manufacturers, and Medicare. Previous studies found that Part D beneficiaries can face big out-of-pocket costs for expensive cancer and rheumatoid arthritis drugs. Low-income subsidies are available —77% of Medicare beneficiaries with HIV received them in 2014, according to Dr. Tseng and colleagues—but the cost-sharing structure still obscures who’s actually paying for what, particularly when beneficiaries are not eligible for subsidization.
Dr. Tseng and colleagues evaluated 18 ART and two PrEP regimens for 1 year for treatment or prevention under a 2019 standard Medicare Part D insurance plan.
For each regimen, the researchers projected annual costs assumed by patients, insurance plans, manufacturers, and Medicare based on four phases. The first was the patient deductible, which is fixed at $415. The second was the covered phase, in which patients pay part of the cost, with insurance plans paying the remainder. The third was the notorious “donut hole” coverage gap, which kicks in after costs reach $3,820—for brand-name drugs, patients cover 25% of the cost with the manufacturer and insurance plan covering 70% and 5%, respectively, with generic drug costs divided by the patient (37%) and manufacturer (63%). The fourth was catastrophic coverage, which sees costs shared among patients (5%), insurance plans (15%), and Medicare (80%) until the end of a calendar year after out-of-pocket costs reach $5,100.
Breaking Down the Cost Contributors
The price of PrEP was a median of $20,570 annually, with patients contributing 15% ($2,990), insurance plans covering 22% ($4,570), manufacturers covering 13% ($2,750), and Medicare covering 50% ($10,260). When including low-income subsidies, Medicare paid 67% to 76% of ART and approximately 65% of PrEP costs.
According to results from the analysis, people who have or are at risk of acquiring HIV pay $3,270-$4,350 each year for antiretroviral therapies if they do not have a low-income subsidy. Without taxpayer subsidies to lower out-of-pocket costs, antiretroviral drug therapies and PrEP are out of reach for many.
“The concern with such a high-cost burden on the individual is that adherence and, ultimately, health outcomes are likely to deteriorate,” wrote Julie Myers, MD, MPH, an infectious diseases specialist with Columbia University School of Medicine, in an editorial accompanying the study. “Although success in ending HIV/AIDS in the US will obviously come at a price, we need to find a way to avoid burdening the people who are underserved and draining public coffers—a way to pay these costs fully without paying dearly.”