STATEMENT OF FRANCES M. MURPHY, M. D., M.P.H.
DEPUTY UNDER SECRETARY FOR HEALTH
DEPARTMENT OF VETERANS AFFAIRS
BEFORE THE
SUBCOMMITTEE ON NATIONAL SECURITY, VETERANS AFFAIRS AND INTERNATIONAL RELATIONS
COMMITTEE ON GOVERNMENT REFORM
HOUSE OF REPRESENTATIVES

June 14, 2001

Mr. Chairman and Members of the Subcommittee:

Thank you for the opportunity to discuss the Department of Veterans Affairs' (VHA) programs for hepatitis C screening, treatment, and prevention. Hepatitis C is a major public health problem in the United States and no less so for VA.

VA has recognized the importance of hepatitis C by establishing an impressive array of initiatives, programs, and activities that have created the largest hepatitis C screening, testing, and treatment program in the world. In recognition of the important and long-term aspects of VHA commitment to hepatitis C, last October the Under Secretary for Health established a new National Hepatitis C Program in VHA Office of Public Health and Environmental Hazards. The mission of this program is to address the needs of veterans with, or at risk for, hepatitis C from a public health perspective. The program includes the following elements:

• wide-spread education for veterans about the risk factors and the disease itself, and scientific and medical education for providers;
• a proactive hepatitis C screening and testing program;
• a treatment program to deliver the highest quality care to veterans with hepatitis C;
• a prevention program to identify veterans at risk and work to intervene; and
• a research program to find ways to improve hepatitis C treatment among veterans.

The Under Secretary also directed this office to create a new National Hepatitis C Registry in order to (1) more accurately track veterans with hepatitis C and their clinical course and outcomes and (2) to manage the resources VA devotes to helping veterans with hepatitis C.

Beginning in FY 2000, reimbursement for the care of veterans on drug therapy for hepatitis C has been at the complex level under the VERA model, equaling approximately $43,000 per year per patient. This level of funding will ensure that facilities receive sufficient resources for these hepatitis C initiatives.

I would now like to address briefly each element of our new National Hepatitis C Program, our accomplishments to date, where we are going in the near future, and the status of our program to screen all veterans for risk of hepatitis C.

Veterans Hepatitis C Education Program

Informing all veterans about known risk factors for hepatitis C is the first step in our overall public health approach for hepatitis C. Through VHA newly established Hepatitis C Field-Based Resource Centers Program (formerly the Hepatitis C Centers of Excellence Program), education material specifically targeted to veterans and their families has been developed and disseminated. VA medical centers (VAMCs), community-based outpatient clinics, substance abuse programs, and Vet Centers distribute information about hepatitis C. In addition, VA recognizes that veterans who do not access the Department's services also must be educated about hepatitis C. We have worked with several veterans service organizations (VSOs), such as the American Legion, Vietnam Veterans of America, and a Veterans-specific hepatitis C interest group, Veterans Armed Toward Awareness (VATA), to assist in education of their members. The American Legion and VATA have recently distributed education posters about hepatitis C to over 14,000 American Legion chapters. The American Legion is also making available an additional 2000 of these posters for distribution to VAMCs and Vet Centers.

In order to inform veterans about the latest scientific advances in hepatitis C, we often update patient education materials on hepatitis C posted on the VHA hepatitis C information web site (www.va.gov/hepatitisc). We have patient-oriented information on 26 separate topics already available or in development on this web site. Currently, we are developing a hepatitis C video education series targeted at veterans and their families to be distributed throughout VA, VSOs, and other community and health organizations. These videos will feature as narrators internationally recognizable United States military, veteran, and government leaders. This video education series will allow the viewer to learn about hepatitis C, possible risk factors, how and why to get tested, and treatment options.

In addition, we will very shortly be distributing 3.4 million educational brochures on hepatitis C to VA users through a joint project of VA and the American Liver Foundation. We also will soon be testing the availability of hepatitis C information through VA Information Kiosks placed in public areas of VAMCs. One of four Hepatitis C Field-Based Resource Centers will specifically focus on Patient Education and Self-Management and will provide patient and family information on hepatitis C, its treatment, prevention, and other important topics.

VA Clinician Hepatitis C Education Program

Hepatitis C is a complex chronic disease for which epidemiology and treatment knowledge is changing rapidly. We have provided resources and opportunities to VA clinicians to learn about hepatitis C and to update their knowledge and skills in order to provide the highest quality hepatitis C care in the Nation. In FY 2000 alone, VA conducted three national hepatitis C update conferences on topics such as guidelines for screening, testing, counseling, and diagnosis and clinical treatment updates. Over 800 front-line VA providers have attended these conferences. Clinical education materials on 18 separate topics are available or in development on the VA Hepatitis C web site mentioned earlier. An additional VA national videoconference on hepatitis C screening, testing, and counseling is scheduled for August 2001. Another national hepatitis C clinical update conference focusing on treatment and transplantation issues will be held in September 2001. In addition, one of the four Hepatitis C Field-Based Resource Centers will focus specifically on Clinician Education.

VA maintains the single largest training program for health care providers, such as medical students, interns, residents, and students in nursing, pharmacy, social work, and psychology In order to educate these clinicians-in-training about hepatitis C, VA will make available 150,000 "Trainee Pocket Cards" that will include information on hepatitis C risk and screening criteria for veterans and will be a resource for these trainees for additional medical information on hepatitis C.

Hepatitis C Screening and Testing Program We define hepatitis C screening as the process of assessing whether a veteran has known risk factors for exposure to hepatitis C in order to determine if testing for the presence of the virus is warranted. We believe all veterans should be screened for risk factors for exposure to hepatitis C. Those found to have known risk factors should be referred for blood testing for evidence of hepatitis C infection. We do not believe that all veterans should have their blood tested for hepatitis C for three reasons. First, data from CDC and the National Health and Nutrition Evaluation Survey demonstrate that the prevalence of hepatitis C among those who identify as veterans in a sample of the U.S. population is the same as that of the public at large. Second, the false positive rate for the standard hepatitis C screening blood test is unacceptably high (up to 50 percent) when used in a low prevalence population. Third, widespread blood testing would lead to unnecessary additional testing, anxiety, and potential harm to the many veterans with false positive tests.

However, there is anecdotal evidence that the prevalence of hepatitis C among certain groups of veterans or certain groups of VA users may be higher than the national rate. Thus, we believe a two-step approach to identification of persons with hepatitis C is the best approach for VA. Those two steps are (1) screening (assessment of known risk factors to determine if blood tests are warranted); and (2) blood testing for evidence of hepatitis C infection, if risk is identified. Using this approach, VA has mounted the largest single hepatitis C screening and testing program in the world. VA screened nearly 540,000 veterans for risk factors of hepatitis C and conducted over 650,000 blood tests in FY 1999 and FY 2000. An estimated 150,000 additional tests have been conducted in the first two quarters of FY 2001. This screening and testing has identified approximately 77,000 unique veterans with hepatitis C and referred all for medical evaluation. Because the electronic clinical reminder system from which these data have been derived has been in place only since July 2000 and continues to be implemented, it is important to recognize that VA has probably screened an even greater number of veterans for hepatitis C risk. In order to continue to improve VHA hepatitis C screening and testing, we recently revised and reissued guidelines on hepatitis C screening, testing, and test counseling. Screening, testing, and counseling will also be the focus of a VA nationwide videoconference to be held in August. In addition, a significant component of VHA hepatitis C videotape series currently being produced will focus on screening and testing for hepatitis C.

Hepatitis C Treatment

VA has identified and treated more persons with hepatitis C than any health care organization in the world. Approximately 77,000 veterans are currently under care in VA facilities for hepatitis C. As you know from the information you recently requested, our Hepatitis C Lead Clinicians are extraordinarily capable and experienced in the treatment of this chronic liver disease. Overall, the providers who serve as lead clinicians for hepatitis C have an average of 14 years experience in the care of hepatitis C and chronic liver diseases and an average of 11 years serving in VA health care. Of the physicians, 94 percent have specialty or subspecialty board certifications, 62 percent of which are in gastroenterology, 23 percent in internal medicine/family practice, and 15 percent in infectious diseases. Sixty-two percent of those with academic affiliations are ranked as full professors or associate professors of medicine. Collectively, our Hepatitis C Lead Clinicians have extraordinary clinical experience as well. Forty-four percent have treated over 500 patients with hepatitis C/chronic liver disease, and 84 percent have treated over 100 patients.

VA makes available all licensed drugs to treat hepatitis C and recently added to the national formulary a new form of alpha interferon as soon as it became licensed by the Food and Drug Administration (FDA). Our National Hepatitis C Program office informed all clinicians and pharmacists treating veterans with hepatitis C of the availability of this new treatment upon its licensure by the FDA. Treatment for hepatitis C changes rapidly. Thus, the VA National Hepatitis C Program office is now updating VHA hepatitis C treatment guidelines and shortly will disseminate the revised materials to all hepatitis C treating clinicians and pharmacists.

VA strongly believes that the best medical management of hepatitis C is far more comprehensive than the administration of drug therapy for persons infected with hepatitis C. Our experience is similar to that of many clinicians caring for persons with hepatitis C. In fact, drug therapy for hepatitis C represents a minority of the care and services needed for those with hepatitis C infection. VA defines hepatitis C treatment as the appropriate medical evaluation of all persons with documented hepatitis C infection, determination if and when drug treatment is warranted, all direct and associated care and services needed during drug treatment, watchful waiting and treatment of related conditions if treatment is deferred, and long-term follow-up care for all. Related conditions frequently include mental health problems, alcohol and substance abuse, liver transplantation, and complications of long-standing hepatitis C or the frequent toxicities of the drugs currently used to treat hepatitis C infection. Thus, the resources needed to care appropriately for veterans with hepatitis C goes well beyond drug therapy. As mentioned earlier, to ensure adequate funding for hepatitis C care, starting in September 2000, VHA Veterans Integrated Service Networks (VISNs) began to receive annual reimbursement at the complex level under VERA for each patient who receives drug therapy for hepatitis C. I feel this is an appropriate reimbursement and a strong incentive to provide comprehensive medical and supportive care to veterans with hepatitis C.

Hepatitis C Prevention

The Centers for Disease Control and Prevention estimates that there are 40,000 new hepatitis C infections each year in the United States. Undoubtedly, many of these new infections occur in veterans. Our comprehensive public health approach to VHA hepatitis C program includes development of proactive programs both in primary and secondary prevention. Primary prevention will identify veterans at risk of hepatitis C infection who receive care and services throughout VA and implement interventions to reduce their risk. Secondary prevention will address veterans already infected with hepatitis C to keep them healthier and free of hepatitis C-related medical complications. Secondary prevention involves decreasing alcohol intake and other lifestyle or medical interventions to protect liver health, such as vaccination for hepatitis A and B. One of the four Hepatitis C Field-Based Resource Centers will focus specifically on hepatitis C prevention.

Research on Hepatitis C

Excellence in clinical care goes hand in hand with excellence in research. Thus, VA endorses a proactive hepatitis C research program. VA researchers are conducting 134 research projects on hepatitis C. This represents an investment of nearly $7.3M in FY 2001. In addition, VA currently supports two Medical Research Hepatitis C Program Projects located at the Portland and Palo Alto VAMCs. The total funding for these projects is approximately $2.6M over five years.

One important research project is being conducted at 24 VA sites in collaboration with the Schering-Plough company and is teaching us much about the treatment of hepatitis C among VA users. Early results from this study show that of the 5,000 patients with hepatitis C who were evaluated for treatment, over 900 (about 18 percent) were enrolled for treatment. The reason for non-enrollment tells us much about how to improve treatment candidacy and why those who elect to be treated or who defer treatment do so. Specifically, we have learned that approximately two-thirds of VA patients with hepatitis C do not meet standard hepatitis C treatment criteria; for example, they have significant non-liver diagnoses, ongoing substance abuse, psychiatric conditions, or a combination of these factors. This study is also confirming what our wider VA treatment data have shown. For those who do meet standard hepatitis C treatment criteria, nearly one-half elect not to be treated because of concern over side effects or the desire to defer treatment to a later date.

I am pleased to announce that VA has begun a national hepatitis C prevalence study that will address several questions important to both veterans and VA. This study will determine the prevalence of hepatitis C among users of the VA system. It will also help determine the risk of hepatitis C associated with several known and putative risk factors, such as era of service, military service in Vietnam, the use of air gun inoculation devices, and alcohol and drug use behaviors. The study will involve 4,000 veterans across the country. The results of this study will greatly improve our understanding of how best to identify veterans at greatest risk of hepatitis C and the magnitude of the care and services that VA will need to supply. In order to ensure that VA hepatitis C scientists and clinicians are at the forefront of research to improve hepatitis C care, VHA Hepatitis C Program office will sponsor a Hepatitis C Research Symposium in October 2001. This symposium will bring together VA hepatitis C researchers, researchers from other government agencies (NIH, CDC, and DOD), and potential collaborators from the pharmaceutical and biotechnology industries. The goal of this symposium will be to catalyze collaborations between VA and other potential partners in hepatitis C research.

Hepatitis C National Registry

The Under Secretary for Health has instructed the National Hepatitis C Program office and the VHA Chief Information Officer to establish a National Hepatitis C Registry. This registry, which will be internal to VA and without public access, will become a pivotal tool for both VA clinicians and managers in assessing and improving our overall hepatitis C effort. The registry will enroll every veteran with hepatitis C and track each veteran's clinical status, use of VA services including pharmaceuticals, laboratory tests, and general health care utilization. Tracking these parameters will allow local clinicians to best manage individual patients through the course of their hepatitis C infection. The registry will also allow our program managers at the local, VISN, and national level to appropriately track and manage the resources needed to care for all veterans with hepatitis C. The computer programming required for this registry is currently being created. Initial testing will start this fall, and the registry will be in place to assist in development of budget projections beginning in FY 2003.

Lessons from the Field - Screening and Communication:

Mr. Chairman, when the Under Secretary established the new National Hepatitis C Program Office in October 2000, he asked the staff to learn immediately from our front-line providers how we were doing in hepatitis C screening, testing, and treatment. In January and February of this year, that office convened a series of four field-based "Think Tanks on Hepatitis C" that involved over 150 front-line providers from all types and sizes of VA facilities. The lessons learned from these meetings have begun to be acted upon.

One of the most important messages we received is that many front-line providers and administrators understood the importance of initiating and increasing screening and testing activities for hepatitis C, but did not understand that resources had been specifically requested to assist them in those efforts. In short, many front-line providers and administrators felt that the increased activities in hepatitis C screening and treatment were an "unfunded mandate." In order to improve communications with front-line hepatitis C care givers and their administrative staff, the National Hepatitis C Program Office initiated the following activities.

• In February 2001, a VA Directive was issued requiring each facility to identify a Hepatitis C Lead Clinician to serve as the principal point of contact between that facility and the National Hepatitis C Program Office.
• In March 2001, the National Hepatitis C Program Office initiated an e-mail list of over 800 VA providers involved in hepatitis C care. The purpose of this e-mail list is to communicate directly to the field about hepatitis C programs, priorities, policies, issues, and clinical and research updates.
• In April 2001, the National Hepatitis C Program Office held the first meeting of the newly formed Hepatitis C Technical Advisory Group (TAG). This group is made up of 25 VA field and administrative staff. The purpose of this TAG is to advise the National Office about programs, priorities, and problems with hepatitis C activities.
• In May 2001, the National Hepatitis C Program Office initiated a newsletter sent to VISN Leadership, all Hepatitis C Lead Clinicians, and the e-mail list of 800 providers. This newsletter summarizes VA priorities, programs, and initiatives, and highlights the goals of VHA Hepatitis C Program.
• In June 2001, the National Hepatitis C Program Office updated and reissued Guidelines on Hepatitis C Testing and Counseling to all VA providers and administrative staff.
• In June 2001, the National Hepatitis C Program Office will issue a Request for Applications to the Hepatitis C Field-Based Resource Centers Program. These four Centers will be funded in FY 2002 and will be required to provide high quality products and programs for front line providers in the areas of Hepatitis C Patient Education, Hepatitis C Provider Education and Skills Building, Hepatitis C Prevention and Risk Reduction, and Hepatitis C Models of Care Delivery and Best Practices.

Differences Between VA Hepatitis C Projections and Actual Utilization:

Before I close my statement, I would like to address issues that have come to light concerning VHA projections about utilization of hepatitis C medical care services. We recently submitted a report to Congress that articulates the reasons for differences between the projections used to formulate budget requests for VA hepatitis C care and what we were able to document as having been actually spent on that care.

It is important to point out that since we began tracking hepatitis C-specific utilization and expenditures, VA has significantly increased the number of patients screened, tested, and treated every year. In addition, VA expenditures for hepatitis C have also increased every year, thus reflecting this increased activity. Hepatitis C expenditures have increased by over $70 million over the past two years.

Hepatitis C is a new disease. The virus that causes the disease was first identified in 1988. The blood test for it was developed only in 1992, and the first treatments were approved in 1997. For these reasons, VHA previous budget estimates were based on assumptions that could not be informed by reliable data on Hepatitis C screening, testing, and treatment. On the basis of VHA actual experience in testing and treating veterans with hepatitis C, we are now better able to understand where those early assumptions were inaccurate.

Specifically, areas of large discrepancy between the earlier estimates and our actual experience involve (1) the number of patients who agreed to be tested for hepatitis C (fewer agreed to be tested than we had projected); (2) the actual number of people who test positive (prevalence - fewer tested positive than we had projected); and (3) the number who agree to treatment for hepatitis C (many fewer agreed to begin therapy than we had projected). It is important to point out that there is continued medical uncertainty about some aspects of hepatitis C treatment, including, for many patients with minimal clinical disease, the value of treatment versus the risk of side effects from treatment. Since hepatitis C infection may persist for decades without clinical symptoms or signs of liver damage, some asymptomatic patients and their providers opt to defer therapy until more effective and better-tolerated therapies are available, or until the infection begins to cause liver damage. In addition, we have learned that methods used to track disease-specific costs in VA are not well equipped to quantify accurately the actual expenditures on any particular disease. Thus, our analyses show that there is likely a systematic under-reporting of costs related to hepatitis C throughout VA.

In sum, our projections were based on estimates of the numbers tested, prevalence, and treatment acceptance that were larger than they have proven to be in reality. At the same time, VHA ability to accurately capture all hepatitis C treatment-related costs likely misses significant costs.

The magnitude of difference between previous models and actual experience justifies a reexamination of the models and assumptions currently used to project hepatitis C expenditures. As a preliminary step in this direction, VA has revised the projections for FY 2002 to $171 million. The budget planning process for FY 2003 will include a more comprehensive revision of the hepatitis C model. In addition, the creation and use of the National VA Hepatitis C Registry will greatly facilitate both VHA ability to capture all hepatitis C treatment-related costs and our overall planning and management of resources for the care of veterans with hepatitis C.

Mr. Chairman, thank you for the opportunity to discuss VHA hepatitis C program. I will now be happy to answer any questions that you or other members of the Subcommittee might have.