HIV, Hepatitis C Drugs Continue to Be Most Costly Group of Outpatient Drugs for Medicaid

Between 2014 and 2017, antiviral medications that treat HIV and hepatitis C cost the Medicaid program more than did any other group of outpatient prescription drugs, according to an analysis from the Kaiser Family Foundation.

During the 4-year period, spending on outpatient prescription drugs increased from $45.9 billion to $63.6 billion, as drug utilization increased from 621.7 million prescriptions to 752.9 million. In 2017 alone, antivirals accounted for more than 13% of the $63.6 billion spent on Medicaid outpatient drugs, which the authors of the report said is due to their high list price and not due to utilization.

“Because states must balance their budgets, ongoing increased spending on Medicaid prescription drugs is a policy concern, prompting states to consider ways to reduce drug spending,” wrote the researchers. “Understanding patterns and trends in drug spending is crucial to effectively managing the benefit and developing strategies to address high drug costs.”

While the Medicaid pharmacy benefit includes more than 90 classes of drugs, the 10 most costly and utilized classes consistently account for a disproportionate percentage, accounting for nearly half of all prescriptions and about two-thirds of spending. During the period, both utilization and spending increased more rapidly between 2014 and 2015, reflecting implementation of Medicaid expansion and a jump in the number of beneficiaries. Spending on Medicaid outpatient drugs is expected to continue to grow as a faster pace than other Medicaid services in the next 10 years, due in large part to the launch of high-cost drugs, as well as the increase in Medicaid beneficiaries.

Throughout the study period, antivirals were consistently the number 1 most costly drug group, and HIV antiretrovirals and hepatitis C drugs accounted for more than 90% of spending on these antivirals. The researchers note that Medicaid is the largest source of coverage for individuals with HIV, providing coverage for more than 40% of those with the virus. However, despite being among the top 10 costliest drugs, antivirals were not among the top 10 most utilized drugs during any of the years analyzed.

The drugs most utilized included narcotic and nonnarcotic painkillers, antidepressants, anticonvulsants, ulcer drugs, antidiabetic drugs, and antihypertensives. During the 4-year period, the same groups made up the top 10 most prescribed drugs each year. However, in recent years, antidepressants have become the most prescribed drug class, accounting for approximately 7% of total prescriptions in 2017.

“Medicaid expansion at least in part explains the increased use of antidepressants, as behavioral health needs, with depression and anxiety in particular, were common amongst the expansion population, and the Affordable Care Act requires that Medicaid provide behavioral health treatment,” explained the researchers.

Notably, the spending on antidiabetics increased by 42% during the study period, with spending nearly doubling. In 2014, antidiabetics were the fifth most costly class of drugs, and by 2017, they were the second most costly class.