Sovaldi: Blowing up State Medicaid Budgets, Cont.

It’s common knowledge that drugmakers don’t like talking about their prices, or the crises created by such astronomically high prices. But when it comes down to “blow[ing] a hole in states’ Medicaid budgets,” it’s a problem we have to talk about.

A recent article by Capital New York highlights the very real issue these high prices will have on the states. According to the report, “More than half the estimated 3.2 million people infected with Hepatitis C nationwide—including prisoners, veterans, the uninsured or Medicaid recipients—have their health coverage at least partially subsidized by taxpayers.”

The article goes on to say that the high prices charged by Sovaldi’s maker, Gilead, creates an enormous problem “for New York, which not only has the most expensive Medicaid program in the country ($54 billion a year) but also one of the largest Hepatitis C populations. State officials estimate as many as 200,000 people are infected statewide, 75 percent of whom don’t know they have the disease.”

The article notes, “New York spends about $2,700 per Medicaid patient per year but health and insurance industry officials say adding in the cost of Sovaldi could overwhelm the state’s Medicaid budget, creating a hole in the state’s annual Medicaid spending cap.”

And the problem isn’t unique to New York. A recent analysis highlighted in Vox found that, because Sovaldi is so expensive, California could potentially spend more on administering the drug for people on Medicaid than it does for K-12 and secondary education combined.

For more on the devastating effects caused by pricing these drugs so high, check out the AHIP Coverage blog.

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