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UNITED STATES DISTRICT COURT WESTERN DISTRICT OF MISSOURI CENTRAL DIVISION J.E.M., J.L.M. ) Plaintiffs, ) ) v. ) Case No. 2:16-cv ) ) BRIAN KINKADE, in his official capacity ) as Director of the
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UNITED STATES DISTRICT COURT WESTERN DISTRICT OF MISSOURI CENTRAL DIVISION J.E.M., J.L.M. ) Plaintiffs, ) ) v. ) Case No. 2:16-cv ) ) BRIAN KINKADE, in his official capacity ) as Director of the Missouri Department of ) Social Services; and ) JOE PARKS, M.D., in his official ) capacity as Director of the MO HealthNet ) Division, ) ) Defendants. ) COMPLAINT I. PRELIMINARY STATEMENT 1. This case challenges the policies of the Missouri Department of Social Services which result in the denial of medically necessary treatment for Plaintiffs J.E.M., J.L.M., and numerous other Medicaid beneficiaries infected with the Hepatitis C virus (HCV), a serious and communicable disease that can cause severe liver scarring, liver damage, cancer, and death. 2. This case is filed on behalf of enrollees in the Missouri Medicaid program, also known as MO HealthNet, who are infected with HCV, who meet the FDA s standards for coverage of curative Hepatitis C medication, but who are denied coverage for medically necessary treatment because of the Defendants arbitrary and improper policies that restrict treatment only to the sickest beneficiaries. Without this treatment, damage to enrollees livers grows more severe and the risk of complications from the disease increases. Case 2:16-cv NKL Document 1 Filed 10/18/16 Page 1 of 19 II. JURISDICTION AND VENUE 3. This action arises under Title XIX of the Social Security Act. The Court has jurisdiction pursuant to 28 U.S.C. 1331, which gives district courts original jurisdiction over all civil actions arising under the Constitution, laws, or treaties of the United States, and 28 U.S.C. 1343(a)(3) and (4), which give district courts original jurisdiction over suits to redress the deprivation under color of state law of any rights, privileges, or immunities guaranteed by the Constitution or acts of Congress. 4. This Court has jurisdiction over this action for declaratory relief pursuant to 28 U.S.C and Rule 57 of the Federal Rules of Civil Procedure. Injunctive relief is authorized by 28 U.S.C. 2202, 42 U.S.C. 1983, and Rule 65 of the Federal Rules of Civil Procedure. 5. Venue is proper under 28 U.S.C. 1391(b). III. PARTIES Plaintiffs 6. Plaintiff J.E.M. is a 45-year-old Medicaid recipient living alone in Imperial, Missouri. He suffers from a variety of medical conditions, including Hepatitis C, pancreatitis, spinal osteoarthritis, and high blood pressure. Because of his Hepatitis C, J.E.M. has experienced a significant decrease in energy and motivation. He also experiences anxiety regarding his disease s progress and the potential fatal effect of the infection, which recently took the life of his father. His doctor has prescribed Harvoni, ledipasvir-sofosbuvir ( Harvoni ), a drug that will likely cure his Hepatitis C. MO HealthNet denied his prior authorization request for Harvoni. 2 Case 2:16-cv NKL Document 1 Filed 10/18/16 Page 2 of 19 7. Plaintiff J.L.M. is a 36-year-old Medicaid recipient living with her two teenage daughters in Foley, Missouri. She has Hepatitis C and also fibromyalgia. Because of her Hepatitis C, J.L.M. s underlying fibromyalgia pain and fatigue has worsened. She also experiences continual anxiety and fear that she may inadvertently infect her children. Her doctor has prescribed Epclusa, sofosbuvir-velpatasvir ( Epclusa ), a drug which will likely cure her Hepatitis C. MO HealthNet denied her prior authorization request for Epclusa. Defendants 8. Defendant Brian Kinkade is the Director of the Missouri Department of Social Services ( DSS ) and, as such, is responsible for the administration and implementation of laws concerning the social welfare of the people of the State of Missouri, including the Medicaid program. Defendant Kinkade is the chief administrative officer of DSS and is responsible for administration of the single state agency for the Missouri Medicaid program. Defendant Kinkade is charged with the ultimate control and administration of DSS, including the duty to administer the Missouri Medicaid program in compliance with the Medicaid Act. He is sued in his official capacity. His principal office is located in Jefferson City, Missouri. 9. Defendant Joe Parks, M.D., is the Director of MO HealthNet, a division of DSS, and, as such, is responsible for the administration of the Missouri Medicaid program with the exception of determining eligibility. Defendant Parks holds ultimate administrative power within the MO HealthNet Division, subject to the supervision of Defendant Kinkade. He is sued in his official capacity. His principal office is located in Jefferson City, Missouri. IV. TREATMENT STANDARDS OF CARE FOR HEPATITIS C 10. HCV is a chronic, life-threatening, communicable, blood-borne viral disease. The Missouri Department of Social Services estimates that 13,000 Missouri Medicaid beneficiaries 3 Case 2:16-cv NKL Document 1 Filed 10/18/16 Page 3 of 19 are infected with HCV. 11. In addition to the baseline manifestation of chronic inflammation throughout the body, HCV can lead to severe liver damage, infections, liver cancer, and death. Nearly 20,000 people in the United States die each year due to liver disease caused by HCV. See (last visited 1/25/16). Even before the advanced stages of the disease, individuals with HCV can suffer from heart attacks, fatigue, joint pain, depression, sore muscles, and arthritis. Up to 70% of those with HCV will develop chronic liver disease, 20% will develop cirrhosis, and 5% will develop liver cancer. HCV is the leading indication for liver transplants in the United States. See (last visited 2/3/16). 12. The severity of HCV is measured by a fibrosis score, which assesses the health of the liver according to the level of liver scarring. The scoring ranges from a score of F0 (mild scarring or scarring absent) to F4 (significant liver damage; cirrhosis). 13. Until recently, the standard of care for the treatment of HCV was a three-drug treatment containing boceprevir, interferon and ribavirin. The treatment only provided at most a 70% cure rate, and was accompanied by significant adverse side effects such as anemia, insomnia, anxiety, depression, nausea, bone pain, muscle pain, joint pain, memory loss and death. 14. On November 22, 2013, the U.S. Food and Drug Administration ( FDA ) approved a new direct acting antiviral (DAA) treatment for HCV: a single-pill treatment containing simeprevir sold by Janssen Pharmaceutical under the trade name Olysio. The FDA designated Olysio a breakthrough treatment because it showed potential to provide a substantial improvement over existing therapies. Since approving Olysio, the FDA has 4 Case 2:16-cv NKL Document 1 Filed 10/18/16 Page 4 of 19 approved seven other DAA treatments for HCV: Solvaldi, Harvoni, Viekira Pak, Daklinza, Technivie, Zepatier, and Epclusa. All of the approved DAA treatments for HCV have been granted breakthrough status by the FDA. Clinical studies of each DAA treatment find that the treatment cures HCV in upwards of 90% of cases. 15. DAAs are the standard of medical care for the treatment of nearly all those with HCV, regardless of fibrosis score. Treatment guidelines approved by the American Association for the Study of Liver Diseases and the Infectious Diseases Society of America ( AASLD/IDSA ) provide that DAAs should not be reserved for only individuals with fibrosis scores of F3 and F4. See (last visited 10/14/16). Rather, the standard of care is treating all patients with chronic HCV infection, except those with short life expectancies that cannot be remediated by treating HCV, by transplantation, or by other directed therapy. See (last visited 10/14/16). Treating nearly all HCV patients is the standard of care in the community. 16. There are no equally effective alternative medications or medical interventions to the use of DAAs. DAAs are the only medication or medical intervention for HCV that produce a sustained virologic response ( SVR ) in more than 90% of patients. Without treatment with DAAs, individuals infected with chronic HCV will never rid themselves of the inflammatory disease, thus placing them at significantly higher risk for extrahepatic symptoms, liver disease, liver cancer, and even death. 17. HCV is a communicable disease. The CDC lists groups of people known to be at increased risk for HCV infection, including health care workers after needle-sticks involving HCV-positive blood and infants born to HCV-positive mothers. See (last visited 2/3/16). 5 Case 2:16-cv NKL Document 1 Filed 10/18/16 Page 5 of 19 V. STATUTORY AND REGULATORY FRAMEWORK Medicaid 18. Title XIX of the Social Security Act, codified at 42 U.S.C w-2 ( Medicaid Act ), establishes the Medicaid program. The objective of the Medicaid Act is to enable each State to furnish medical assistance to families with children and to aged, blind, or disabled individuals whose incomes and resources are insufficient to meet the costs of necessary medical services and to furnish rehabilitation and other services to help such families and individuals attain or retain capability for independence or self-care. 42 U.S.C Medicaid is a cooperative federal-state program. Participation in the Medicaid program is not mandatory for the states, but once they choose to participate, they must operate their programs in conformity with federal statutory and regulatory requirements. 42 U.S.C. 1396a. 20. Each state choosing to participate in the Medicaid program must designate a single state agency which is responsible for administering the program. 42 U.S.C. 1396a(a)(5). 21. The Medicaid Act requires participating states to provide for making medical assistance available... to [all eligible individuals]. 42 U.S.C. 1396a(a)(10)(A). Medical assistance is defined as payment of part or all of the cost of... care and services included in an enumerated list of twenty-nine general categories of assistance. 42 U.S.C. 1396d(a). Some of the categories of assistance are mandatory and must be included within a state s Medicaid plan, whiles others are optional. See 42 U.S.C. 1396a(a)(10)(A). 22. States have the option to cover prescription drugs. 42 U.S.C. 1396d(a)(12). Missouri has chosen to provide prescription drug coverage as part of its State Medicaid Plan. 23. Among other things, the Medicaid Act requires states coverage of prescription 6 Case 2:16-cv NKL Document 1 Filed 10/18/16 Page 6 of 19 drugs to comply with the requirements of 42 U.S.C. 1396r-8. With limited exceptions not relevant here, Missouri must cover the drugs that are manufactured by companies that have entered into rebate agreements with the Secretary of the U.S. Department of Health and Human Services for their medically accepted indications. A medically accepted indication means any use for a covered outpatient drug which is approved under the Federal Food, Drug, and Cosmetic Act or a use that is supported by one of three congressionally-approved drug compendia. 42 U.S.C. 1396a(a)(54), 1396d(a)(12), 1396r-8(d), 1396r-8(k)(6). 24. All of the manufacturers of the drugs at issue here have entered into rebate agreements, and the U.S. Food and Drug Administration (FDA) has approved use of the drugs for treatment of Hepatitis C. 25. Under the federal Medicaid Act, the state can impose utilization review techniques on drugs, as long as the state ensures access to drugs for their medically accepted indications. 42 U.S.C. 1396r-8(d)(5). 26. In November 2015, the Centers for Medicare & Medicaid Services ( CMS ), the federal Medicaid agency, issued policy guidance for states on the outpatient drug coverage requirements for direct-acting antiviral ( DAA ) treatment for HCV treatments, such as Harvoni and Epclusa. CMS, Assuring Medicaid Beneficiaries Access to Hepatitis C (HCV) Medications (2015), Topics/Benefits/Prescription-Drugs/Downloads/Rx-Releases/State-Releases/state-rel-172.pdf. After specifying the limited circumstances in which states may exclude or restrict coverage of an FDA-covered drug, CMS advised states that they are required to provide coverage for FDAapproved drugs once the manufacturer enters into the rebate agreements described in the Act when such drugs are prescribed for medically accepted indications, including the new DAA 7 Case 2:16-cv NKL Document 1 Filed 10/18/16 Page 7 of 19 drugs. Id. at 2-3 (emphasis added). While noting that states have the discretion to establish utilization controls on the coverage of these drugs, such as preferred drug lists and use of prior authorization processes, CMS underscored that the practices must be consistent with the Act, and that states limitations should not result in the denial of access to effective, clinically appropriate, and medically necessary treatments using DAA drugs for beneficiaries with chronic HCV infections. Id. at Defendants cover DAAs, including Harvoni and Epclusa, under the Missouri State Medicaid Plan, but only for the most severely ill individuals. Defendants refuse to cover the medication for Medicaid enrollees with less severe liver damage or other symptoms of HCV, even though the coverage is for a medically accepted indication as recognized by the FDA and the medications will likely cure them. Since DAAs meet the standard for coverage under the Medicaid program, the Medicaid Act requires coverage of the medicine when it is for a medically accepted indication. 42 U.S.C. 1396a(a)(10)(A), 1396r Covered prescription drugs, including DAAs, must be made available to Medicaid beneficiaries when medically necessary, with reasonable promptness, for all comparable Medicaid enrollees. 42 U.S.C. 1396a(a)(8). 29. The prescription drug coverage, including access to Harvoni, Epclusa, and other DAAs, that is made available to an individual eligible under the State Medicaid Plan cannot be less in amount, duration or scope than the coverage made available to any other such individual. 42 U.S.C. 1396a(a)(10)(B), 42 C.F.R , 42 C.F.R (b) (requiring states to ensure that the amount, duration, and scope of coverage are reasonably sufficient to achieve the purpose of the service). This is known as Medicaid s comparability requirement. 8 Case 2:16-cv NKL Document 1 Filed 10/18/16 Page 8 of 19 30. Controlling Eighth Circuit precedent requires the State to cover all nonexperimental, medically necessary services, within a covered Medicaid category. Lankford v. Sherman, 451 F.3d 496 (8th Cir. 2006); Weaver v. Reagen, 886 F.2d 194, 198 (8th Cir. 1989). [A] state s failure to cover non-experimental, medically necessary services within a covered Medicaid category is both per se unreasonable and inconsistent with the stated goals of Medicaid. 451 F.3d at The Eighth Circuit has previously rejected restrictions on prescription drugs that, reflect... inadequate solicitude for the applicant s diagnosed condition, the treatment prescribed by the applicant s physicians and the accumulated knowledge of the medical community. Weaver, 886 F.2d at 200 (quoting Pinneke v. Preisser, 623 F.2d 546 (8 th Cir. 1980) (emphasis added)). VI. MISSOURI S COVERAGE CRITERIA FOR HEPATITIS C 32. The State of Missouri has elected to participate in the Medicaid program and has designated DSS as the single state Medicaid agency. DSS is a department of state government. 33. The federal government shares the cost of the Missouri Medicaid program by providing funding to the State of Missouri. The federal government pays approximately 63 cents of each dollar spent on Medicaid services in Missouri. 79 Fed. Reg (Dec. 2, 2014). 34. The MO HealthNet Division indicated on June 23, 2016 that it agrees with the AASLD/IDSA recommendation that ALL patients should be treated and that it welcomes the opportunity for every HCV infected patient to have the chance to be cured. 35. However, Defendants have adopted coverage criteria with respect to when and under what conditions it will approve Harvoni and other similar DAAs for coverage under Missouri s Medicaid program that are more restrictive than the national standards of care. 9 Case 2:16-cv NKL Document 1 Filed 10/18/16 Page 9 of 19 Missouri Pharmacy Program Preferred Drug List Hepatitis C Therapy (Effective 8/01/2005, Revised 10/1/2015, Defendants have presented these coverage criteria to the MO HealthNet Oversight Committee, a statutorily-created body that advises Missouri s Medicaid program Defendants do not provide coverage for all Medicaid beneficiaries with HCV. Defendants coverage criteria exclude coverage of DAAs for Medicaid enrollees with HCV genotypes 1, 2, and 4 with fibrosis scores of F0, F1 and F2; and exclude coverage of DAAs for Medicaid enrollees with HCV genotype 3 at fibrosis scores of F0 and F Defendants report that they have approved some participants for coverage of DAAs with fibrosis scores of less than F3 based on other specifics of their condition, but their published prior authorization criteria do not reflect this practice. Defendants criteria do not include specific factors under which individuals with these lower scores can seek to qualify for coverage of DAAs. 39. Fibrosis score is not an acceptable medical reason for denying access to medically necessary DAAs. Plaintiffs were denied DAAs because they did not have fibrosis scores of F3 or F Defendants prioritize treatment for Hepatitis C patients who they believe most urgently need it rather than provide it to patients for whom such treatment is medically necessary. Defendants policy is to defer treatment until a patient reaches a more advanced stage of liver disease, as measured by fibrosis requirements. The deferral policy has resulted in Plaintiff J.L.M. waiting over three months, so far, and Plaintiff J.E.M waiting over seven months, so far, for coverage. 10 Case 2:16-cv NKL Document 1 Filed 10/18/16 Page 10 of 19 41. Defendants coverage criteria are inconsistent with accepted medical practice. Defendants have no clinical or medical basis to deny treatment to Medicaid enrollees who have a fibrosis score of F0, F1 or F2. On the contrary, the HCV Guidelines provide that [b]ecause of the myriad benefits associated with successful HCV treatment, clinicians should treat HCVinfected patients with antiviral therapy with the goal of achieving an SVR, preferably early in the course of their chronic HCV infection before the development of severe liver disease and other complications. See (last visited 10/14/16). Treatment of HCV even in patients with mild or no liver disease decreases complications and death rate due to liver disease and prevents transmission of HCV to others. 42. Medicaid enrollees who meet the standards set forth by the American Association for the Study of Liver Diseases and the Infectious Diseases Society of America, but who are excluded under Defendants coverage criteria, are at risk. They are needlessly exposed to health conditions caused by HCV, including cirrhosis, cancer, fatigue, joint pain, depression, sore muscles, arthritis, avoidable liver transplants, jaundice and even death. In addition, the lack of treatment of infected individuals increases the chance that members of the insured s household and the public will be exposed to and contract HCV. 43. Defendants authorization criteria also deny DAAs to anyone who has tested positive for alcohol or illicit drug use. Patients must undergo three months of abstinence testing (which means they must test negatively for drug and alcohol use three times over three months) before MO HealthNet will consider an authorization request for DAAs. 44. This abstinence requirement is inconsistent with AASLD/IDSA guidelines, which do not require abstinence as precondition for treatment. This requirement further delays 11 Case 2:16-cv NKL Document 1 Filed 10/18/16 Page 11 of 19 medically necessary treatment to infected patients, allowing their liver disease to progress unnecessarily, and placing them at additional risk. Denying access to DAAs for individuals who test positive for drug use means that such individuals are more likely to spread the disease th
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